About SAFLII
Databases
Search
Terms of Use
RSS Feeds
South Africa: Free State High Court, Bloemfontein
SAFLII
>>
Databases
>>
South Africa: Free State High Court, Bloemfontein
>>
2012
>>
[2012] ZAFSHC 89
|
|
Van der Walt v Vrystaat Kooperasie Bpk (1498/2007) [2012] ZAFSHC 89 (7 May 2012)
23
FREE STATE HIGH
COURT, BLOEMFONTEIN
REPUBLIC OF SOUTH
AFRICA
Case no:
1498/2007
In the matter between:
MARIA MARTHINA VAN DER
WALT
…...........................................................
Applicant
and
VRYSTAAT KOöPERASIE
BEPERK
…........................................................
Respondent
HEARD ON:
3 May 2012
JUDGMENT DELIVERED BY:
SNELLENBURG, AJ
DELIVERED ON:
7 May
2012
[1] This is an
application by the applicant,
MARIA MARTHINA VAN DER WALT
, to
set aside the order, made by agreement between the parties by
CHG
van der Merwe J
on
19 October 2010,
in terms whereof the
Deed of Settlement entered into between the parties was made an order
of court.
[2] The Court order was
preceded by the following events which are not in dispute:
[3] Respondent issued a
simple summons in which it claimed payment of the amount of R541
294.31, with interest calculated at 15.8%
per year as from 1 March
2007 up to date of payment (calculated on a daily basis on the
balance and capitalised monthly), as well
as costs of the suit on the
scale as between attorney and client from the applicant. The summons
was subsequently, in June 2009,
amended to reflect the amount due as
being R794 005.23.
[4] The respondent’s
claim against the applicant arises from a deed of surety wherein the
applicant bound herself in favour
of the respondent as surety and
co-principal debtor for the due and proper compliance by Cornelis
Wilhelmus van der Walt, the applicant’s
son and the principal
debtor, for due compliance by him with all obligations and proper and
timeous payments of all amounts owing
by him to the respondent
arising from the granting of credit facilities or arising out of any
cause of action whatsoever, including
any amounts which the principal
debtor owes the respondent in his capacity as surety or co-principal
debtor, notwithstanding whether
such payments must be made or
obligations complied with in connection with a debt or an obligation
existing at the time of the
conclusion of the deed of suretyship or
whether such payment or obligation comes into existence in the future
and notwithstanding
whether the debt is incurred by the principal
debtor in own name or in the name of any business wherein he holds an
interest.
[5] It appears from the
present application that the applicant, her son (the principal
debtor), and his wife instructed the same
attorney from Vereeniging
to represent them as separate summonses were issued against her in
her capacity as surety, against the
principal debtor in his capacity
as such and against his wife. I will refer to this attorney as
attorney A.
[6] Attorney A’s
advice was to the effect that both the principal debtor and his wife
would be sequestrated on the grounds
of a debt of approximately R13
000.00 each, whereafter he would finalise the applicant’s
matter on the basis that she should
pay R150 000.00 into his trust
account. The applicant does not state when the advise was given, but
in the context of the matter
it would have been after the initial
consultation when the applicant, inter alia, set out her defence
against the claim against
her.
[7] In an answering
affidavit deposed to by the applicant to resist a summary judgment
application, she relied on the following
defences:
The applicant denied
that the deed of suretyship complied with the requirements of
Section 6 of the General Law Amendment Act,
50 of 1956, due to the
fact that she alleged that the deed of suretyship was not completed
when she initialled and signed the
said document;
The applicant relied on
an express oral agreement with a duly authorised representative of
the respondent that her obligations
as surety would be limited to
the amount of R150 000.00, being the limit of the credit facility
that the respondent made available
to the principal debtor.
The applicant denied
that the witness to the suretyship agreement was present when she
signed it.
The applicant denied
that the principal debtor owed the amount of R541 000.00 (the plea
was never amended after the amendment
during 2009) to the
respondent.
The applicant disputed
the calculation of the amount on the basis that the Plaintiff made
its calculations charging an interest
rate of 21%, whilst the
agreement between the respondent and the principle debtor only
provided for interest at 15%.
The applicant contended
in the alternative that the respondent’s conduct was
prejudicial to her as surety and that she should
be released from
her obligations in terms of the suretyship agreement as a result of
the fact that a notarial bond was registered
over certain movable
assets of the applicant’s daughter-in-law as further security
with regards to the principle debtor’s
credit facility, but
that the respondent released a John Deere harvester, worth
R500 000-00 from the bond.
[8] The summary judgment
did not proceed and the parties reached an agreement that leave be
granted to the applicant to defend the
action and that the costs of
the application for summary judgment be reserved. The order was duly
made by agreement between the
parties on 17 May 2007 by P Zietsman,
AJ.
[9] In the applicant’s
plea to the respondent’s declaration, the applicant essentially
relied on the same defences set
out in her answering affidavit. The
applicant, in addition, denied the allegations regarding the
principal debtor’s purchase
on credit of goods for the years
2000 to 2006, as well as credit life assurance premiums which the
Plaintiff alleges it paid on
behalf of the principal debtor; the
amount owing in terms of the declaration as at 4 April 2007 being
R541 294.31 plus interest
at 15.8% per year, calculated from 1 March
2007 to 4 April 2007, both dates included.
[10] On 20 November 2010
the matter was enrolled for hearing on 19, 20 and 22 October 2010.
[11] The respondent made
an application to compel the applicant to reply to the request for
further particulars, after which the
applicant replied and as result
of which the applicant was ordered, on 26 August 2010, to pay the
respondent’s costs occasioned
by the application. On 8 October
2009 the respondent furthermore succeeded with an application to
compel the applicant to respond
to the Notice in terms of Rule 35.
The applicant was again ordered to pay the costs of the application.
[12] The applicant, save
for requesting and receiving discovery, did not submit any requests
in terms of High Court Rule 21 or 37(4).
[13] On 14 October 2010
the applicant’s then attorney of record, to whom I shall refer
as attorney B, addressed a letter to
the respondent’s attorneys
of record wherein the applicant made an offer to settle the action.
In the letter it is recorded
that the offer is made after receipt of
the file from attorney A and proper consultation with the applicant.
The offer entailed
that the applicant would settle the matter by
paying a capital amount of R200 000.00 and costs of the action over
and above the
costs orders allready granted in favour of the
respondent.
[14] The respondent made
a counter offer which in turn resulted in the written agreement (Deed
of Settlement) entered into and concluded
between the parties on 18
October 2010. The deed of settlement was duly made an order of court
by agreement. The order was not
granted in absence of the applicant.
[15] The Applicant states
in the founding affidavit that the purpose of the application is for
rescission due to the fact that she
was not aware thereof that the
Respondent had already recovered an amount of R2,026,611.77 in
respect of the debt allegedly owed
by her son (the principal debtor)
in the amount of R541,294.31.
[16] The applicant admits
that the principal debtor, during 1999 already, defaulted on payments
to the respondent and that, for
various reasons, the principal debtor
was not able to make payments as per the credit agreement to the
respondent.
[17] After the applicant
had made a payment of an amount of R200 000.00 on the capital amount
owed in terms of the deed of settlement,
she was informed by way of
letter from the respondent’s attorneys that an amount of R276
388.21 was still payable in terms
of the deed of settlement.
[18] According to the
applicant she then made enquiries from her son with regards to what
was paid towards the initial debt and
was shocked to learn that an
amount of in excess of R2 million had been paid. The result was this
application for rescission.
[19] Since the applicant
has approached the Court by way of motion proceedings,
the application falls to
be dealt with on the principles enunciated in
Plascon-Evans
Paints Ltd v Van Riebeeck Paints (Pty) Ltd
1
.
[20] The applicant’s
counsel submitted that the applicant’s case was premised on the
following grounds, which accords
with the papers:
the applicant’s
lack of knowledge regarding the compilation of the amount claimed by
the Respondent which was brought about
on the applicant’s
version as result of the respondent not disclosing the basis for the
amount claimed and the payments
received; hence, on her version, the
fact that the respondent had received, prior to the order, more than
what was owing. The
applicant submits that by acting in this manner
the respondent misled her and her son (the principal debtor);
that, had the applicant
and attorney B known of the amounts paid to date (when the
settlement agreement was concluded), she would
not have entered into
the agreement;
that the respondent only
disclosed its reliance on the ‘second facility/agreement’
in its answering affidavit filed
in these proceedings. The
applicant’s case in this regard is that she would not have
entered into the settlement agreement
(and consented to the
judgement) had she known that the respondent’s claim included
amounts advanced in terms of the second
credit facility, as she was
only liable as surety in terms of the first credit facility and,
secondly, that her obligation was
limited to R150 000.00 as set out
in her plea and the answering affidavit in the application for
summary judgment;
that, under the
circumstances and on the basis of justice and fairness she is
entitled to rescission of the judgment. The circumstances
the
applicant relies on, are the conduct of her previous attorneys,
attorneys A and B, who, according to her, failed to advise
her
properly and who, generally, failed or neglected to render services
with the degree of skill that can be reasonable be expected
from
attorneys when acting on behalf of a client in litigation. (For
example, the applicant complains that attorney A failed
to properly
advise attorney B of her case and specifically the payments which
had been made.)
[21] High Court Rule
42(1), which provides for rescission of judgments, is not applicable.
It is trite that, in terms of the common
law, a judgment granted by
consent can only be set aside on the basis of fraud or
iustus
error
2
i
.
[22] As stated, the
applicant relies on three grounds for the rescission of the (by
consent) order or judgment, namely fraud,
iustus
error and other
circumstances based on justice and fairness.
[23] It is apposite to
firstly deal with the applicant’s reliance on other
circumstances based on justice and fairness.
[24] In Groenewald v
Gracia (Edms) Bpk
3
Van Zyl AJ (as he then
was) held, with reference to the following passage in De Wet and
Others v Western Bank Ltd
4
,
that rescission, in terms of the common law, could also be justified
on other circumstances based on justice and fairness:
‘
It
follows from what I have said that the Court's discretion under the
common law extended beyond, and was not limited to, the grounds
provided for in Rules 31 and 42 (1), and those specifically mentioned
in the Childerley case. Those grounds do not, for example,
cover the
case of a litigant or his legal representative whose default is due
to unforeseen circumstances beyond his control, such
as sudden
illness or some other misadventure; one can envisage many situations
in which both logic and common sense would dictate
that a defaulting
party should, as a matter of justice and fairness, be afforded
relief.’
[25] The judgment in
Groenewald v Gracia (Edms) Bpk was followed in KR Sibanyoni Transport
Services CC v Sheriff, Transvaal HC
5
.
[26] As appears from the
judgment by Trengove AJA (as he then was), the judge was dealing with
and referring to the court’s
discretion at common law to set
aside default judgments. That much is evident from the judgment
itself. The judgment and specifically
the passage referred to above
did not refer to or deal with rescission of judgments granted by
consent nor, is there any indication
that the court intended to
pronounce on grounds for rescission of judgments granted by consent
at common law.
[27] I,
therefore, with respect,
disagree with the finding of Van Zyl AJ in the
Groenewald
case that the
De
Wet
judgment
is authority therefor that a judgment granted by consent can be set
aside at common law also on other circumstances and
based on justice
and fairness.
[28] For the same reasons
I respectfully disagree with the findings in the judgments of
KR
Sibanyoni Transport and
Georgias
v Standard Charted Finance Zimbabwe Ltd
6
in
as
far
as
they followed the
Groenewald
case that a judgment
granted by consent may be set aside at common law on other
circumstances and based on justice and fairness
.
I am
fortified in my view by the judgment of Miller J.A. in Gollach &
Gomperts v Universal Mills & Produce Co
7
where the appellate
division dealt specifically with judgments by consent and the
rescission thereof.
[29] Regarding the
applicant’s reliance on this ground for rescission of the
judgment, the applicant would, in any event,
not have been entitled
to rescission of the consent judgment even if the principles were
applicable.
[30] The mere fact that
the applicant was the victim of conduct by her attorneys which fell
short of the degree of skill and care
that can be expected from an
attorney conducting a client’s case, and if her version in this
regard is accepted for purposes
of this application, that
circumstance cannot in itself constitute a valid
causa
for rescission of the
judgment that she consented to. . The same principle would apply to
the agreement she concluded with the respondent.
The said attorneys
were, after all, her own attorneys.
[31] The respondent
cannot be held responsible for conduct or omissions by applicant’s
attorneys, chosen and instructed by
her, whilst conducting her case.
The applicant’s remedy would be to claim damages on the
strength of breach of contract or
breach of a duty of care from her
erstwhile attorneys.
[32] The applicant’s
counsel could not advance any basis that would entitle a party to
resile from an agreement entered into
with an innocent party simply
because such party’s attorney did not render adequate and
professional services, save to submit
that it would be ‘other
circumstances”, constituting a basis for justice and fairness.
I disagree. Simply evaluated
on the basis of fairness and justice it
would be manifestly unfair and unjust to the innocent party.
[33] An unilateral
mistake as result of the conduct of her attorneys would also not
avail the applicant in the circumstances.
[34] What remains is to
consider whether the applicant has met the requirements to prove that
her consent to the judgment is vitiated
as result of
fraud
perpetrated by the
respondent or that the consent was the result of an
iustus
error
.
[35] An
iustus
error must vitiate true
consent and must not merely relate to motive or to the merits of a
dispute which it was the very purpose
of the parties to compromise
(Cf Gollach & Gomperts v Universal Mills & Produce Co. case
at 922H – 923A.) In the
same judgment at
923C
- D
Miller
JA cautions that
‘
Voluntary
acceptance by parties to a compromise of an element of risk that
their bargain might not be as advantageous to them as
litigation
might have been is inherent in the very concept of compromise. This
is a circumstance which the Court must bear in mind
when it considers
a complaint by a dissatisfied party that, had he not laboured under
an erroneous belief or been ignorant of certain
facts, he would not
have entered into the settlement agreement.
’
[36] The nature and
purpose of a compromise (transactio) were summarised by Van Zyl J in
MEC for Economic Affairs, Environment and
Tourism v Kruisenga and
another
8
as [it]
“
is
an agreement wherein the parties have in contemplation a matter or
lawsuit, the issue or result whereof is doubtful, and which
they
agree to settle definitively between themselves There is no need for
a compromise to be entered into in a formal manner. It
may be
judicial (by entering it on the record), or extrajudicial (written or
verbal).
The purpose of a
compromise is not only to bring an end to existing litigation, but
also to prevent or avoid litigation. Any kind
of doubtful right can
therefore be the subject of a compromise. Delictual claims, such as
in the present matter, are frequently
the subject of a compromise.
The claim need not even be prima facie actionable in law. As stated
by Mullins J in Hamilton v Van
Zyl, a valid compromise 'may be
entered into to avoid even a clearly spurious claim, and defendants
frequently for various reasons,
settle claims which they know or
believe a plaintiff will not succeed in enforcing by action'.”
[37] The applicant’s
statement that the respondent for the first time disclosed in the
answering affidavit in these proceedings
that it relied on the
so-called second credit facility, and that her suretyship obligation
was limited and to apply only to the
first credit facility (and could
therefore not apply to monies owed by the principal debtor in terms
of the second credit facility)
is clearly untenable. It raises
serious doubts regarding the applicant’s
bona fides
in
these proceedings.
[38] In so far as the non
disclosure of the second credit facility is part of the basis for the
alleged non disclosure when a duty
to speak existed, the averments of
the applicant is without merit. The respondent specifically pleaded
the ‘second credit
facility’ in its declaration and also
appended the written application for the facility by the principal
debtor, which was
granted by the respondent, to the declaration.
[39] The terms of the
deed of surety are also self explanatory and contrary to the
applicant’s averments.
[40] The deed of surety,
clearly and unambiguously, provides that the applicant is bound in
favour of the respondent for due compliance
by the principal debtor
with all obligations and proper and timeous payments of all amounts
owing by him to the respondent arising
from the granting of credit
facilities or arising out of any cause of action whatsoever,
including any amounts which the principal
debtor owes the respondent
in his capacity as surety or co-principal debtor, notwithstanding
whether such payments must be made
or obligations complied with in
connection with a debt or an obligation existing at the time of the
conclusion of the deed of suretyship
or whether such payment or
obligation comes into existence in the future and notwithstanding
whether the debt is incurred by the
principal debtor in own name or
in the name of any business.
[41] The applicant relies
on fraudulent misrepresentation by the respondent and states that the
respondent had a duty to disclose
all payments it received to her
before she entered into the settlement agreement. The applicant, as
stated, relies on the fact
that, had she and her attorney known that
amounts were included in respect of the second credit facility and of
the amounts paid
as at date of conclusion of the settlement
agreement, she would not have signed (entered into) the agreement.
The applicant states
that the capital amount claimed, on her
calculations and which she made after receipt of the last letter of
demand from the respondent,
shows that there has been an overpayment
without her paying the outstanding balance still owing in terms of
the deed of settlement
(and court order).
[42] The evidence of the
applicant, however, falls well short to firstly prove any
misrepresentation, let alone a fraudulent misrepresentation,
by the
respondent and, secondly, from proving, even prima facie, that there
was indeed such an overpayment. Put differently, the
applicant has
not made out a proper case that the amount that the respondent
claimed was not and could not have been due as at
date of conclusion
of the agreement. The applicant creates the impression that R2
million was paid on an indebtedness of R541 294.31.
The
respondent constantly, or frequently, advanced monies to the
principal debtor and paid certain premiums on his behalf from
1998
until 2007. Payments made during an extended period over several
years amounted to R1 566 642.32. That still left
the
balance sued for; and which was subject to interest accruing.
[43] The applicant
firstly states that any amount still due by the principal debtor, for
which the surety is liable, could not attract
interest after the
principal debtor was sequestrated. That is an untenable contention
which does not deserve further consideration.
[44] The applicant’s
lack of knowledge of the compilation of the amount claimed from her
and whether any amount was due by
her must off course be evaluated in
the light of the following considerations:
[45] The principal debtor
is the applicant’s son. They both appointed the same attorney,
attorney A, after receiving the summonses.
The surety and principal
debtor consulted the attorney together. It is undisputed that the
principal debtor received statements
from the respondent monthly and
never disputed any entries on the statements. During what appears to
be the first consultation
with attorney A, the applicant, the
principal debtor and his wife were advised and consented to the
manner in which they would
proceed further, namely the sequestration
of the principal debtor and his wife and payment by the applicant of
the R150 000.00.
The trustees, in October 2007 already, sold certain
movable assets of the principal debtor, of which sale the applicant
was aware.
The correspondence (on 14 October 2010) by attorney B
however contradicts the applicant’s averments, as it
specifically records
that “
Ons het volledig met die
Verweerder gekonsulteer nadat ons die leêr vanaf
(attorney
B)
ontvang het. Dit blyk uit berekeninge van die eisbedrag toon
dat rente op die kapitaal grootliks verantwoordelik is vir die bedrag
huidiglik verskuldig”
[46] The respondent did
allocate dividends received from the trustees of the insolvent
estate.
[47] The matter was only
settled in October 2010. The outstanding amount was still subject to
interest accruing. The agreement also
provided for interest on the
capital amount until payment thereof in full.
[48] The applicant never
availed herself of any of the remedies provided for in the Rules of
Court to require either further discovery
or to make enquiries
regarding debits and credits regarding the principal debtors
liability, notwithstanding knowledge, for example,
of the fact that
the trustees, during 2007 already, sold movable assets and received
the proceeds thereof. In this respect the
applicant does not state
whether the principal debtor had any other creditors, which is off
course relevant if she states that
the whole of the proceeds from the
sale should have been applied against the principal debtor’s
indebtedness towards the
applicant for which she stood surety. The
respondent in any event allocated dividends received which still left
an outstanding
balance of R846 686.36 on 31 August 2010.
[49] The parties were
involved in litigation and the indebtedness was always disputed as
well as the quantum thereof. The applicant,
in her answering
affidavit in the summary judgment proceedings, denied the amount
claimed by the respondent.
[50] Clearly in these
circumstances, should there be any merit in the applicant’s
arguments that there were errors in the
compilation or calculation of
the applicant’s indebtedness or that amounts paid were not
taken into consideration, the applicant
cannot now rely on a duty to
disclose whilst it is clear that the applicant never availed herself
of any assistance at her disposal
such as either a request for
further particulars or further discovery if she had any reason to
believe that there had been inadequate
discovery by the respondent.
It has not been proven that the respondent’s representatives
acting on its behalf did not
bona fide
believe the allegations
contained in the summons or regarding the debits and credits on the
statements, alternatively that representations
were made by
representatives on its behalf knowing them to be contrary to what the
true belief – or, even, actual facts and
figures -was.
[51] The settlement
itself came about after an offer from the applicant a mere 4 days
prior the date on which the trial was enrolled
to commence to which
the respondent made a counter offer, as it was entitled to do.
[52] I find that the
applicant has not succeeded, even prima facie, to show that any
misrepresentation, let alone a fraudulent misrepresentation,
was made
by the respondent.
[53] The respondent
denied having made any misrepresentations and disputed the
applicant’s averments regarding the compilation
and calculation
of the amount. In support of its case the respondent appended
reconciliations that show that the principal debtor’s
indebtedness was indeed much more than the applicant averred and that
the amount that were claimed was indeed due. The respondent’s
version is neither far-fetched nor clearly untenable. It must be
borne in mind that the applicant argues that nothing was owed
at date
of settlement because the respondent had been overpaid by almost a
million rand by that time. These statements by the applicant
were
made without any regard to the allegations in the declaration. I have
already found that the applicant’s evidence in
that respect is
clearly untenable and raises serious doubts regarding her
bona
fides
. The reconciliations in any event disprove the applicant’s
case authoritatively.
[54] The incorrect
reflection of some of the payments, even if it be accepted, would not
alter the position that the applicant was
indebted in her capacity as
surety in an amount substantially more than the eventual settlement
amount to the respondent when the
agreement was concluded. That
dispute was, as stated, the very issue that the parties seriously
intended to settle. The fact that
parties disagree with regard to the
amount owed does not, and cannot, in itself give rise to the
assumption that the one or other
is intentionally misleading the
other. These kinds of disputes form the basis of actions that are
adjudicated in courts daily.
The risk of a compromise being more
disadvantageous than litigation has already been dealt with. The
matter was eventually not
settled on what the respondent claimed, but
for a substantially lesser amount. That is the purpose and the nature
of compromises.
[55] During argument
counsel acting on behalf of the applicant pointed out one instance
where the sum of certain items in the reconciliation,
when added up,
apparently do not correspond with the balance reflected. Save that
these allegations were vaguely canvassed in the
replying affidavit to
which the respondent obviously could not reply, this will, at best,
have an influence on the calculation
of the amount that always formed
part of the initial dispute on the merits that was compromised or
settled.
[56] In the circumstances
of the case it is clear that only the applicant or her attorney or,
possibly, both of them are to blame
for any erroneous belief, if any,
which she might have laboured under when she entered into the
agreement and consented to the
judgment. And as I have demonstrated
above, that is not enough – at least in the context of this
particular matter –
to assist the applicant.
[57] I agree with Mr de
Wet on behalf of the respondent that the applicant’s discontent
with the agreement only arose when
she realised what the extent of
the costs orders were that she was liable for in terms of the
agreement. This is also supported
by the applicant’s averments
that the costs are far-fetched and unreasonable. It is, however,
clear that the agreement itself
provided that the applicant will be
liable for costs already taxed and costs still to be taxed where
orders were granted against
her, including the costs of the action on
the scale as between attorney and client. The only manner in which
she may obtain some
relief in this regard, is by objecting in the
proper manner and in the correct forum against fees which the
respondent levies.
The fact that her attorney failed or neglected to
explain the extent of costs orders to the applicant cannot sustain an
order for
rescission of the judgment. Her remedy is against her
attorney in such instance. Save for the costs regarding the action,
the rescission
of the judgment will in any event not have any effect
on the costs orders that have been granted. The applicant will remain
liable
to pay the same.
[58] To my mind there is
no room for the applicant to rely on an iustus error in the
circumstances of this application.
[59] It is also
abundantly clear that any error that the applicant relies on merely
relates to motive or to the merits of the dispute
which it was the
very object of the parties to compromise. As such the applicant
accepted the risk that the settlement may not
have been as
advantageous to her as litigation might have been. The defence
regarding the validity and the limited extent of the
suretyship (the
alleged agreement that the surety must be limited to R150 000.00)
comes to mind.
[60] The simple fact of
the matter is that on the applicant’s own version, she in
person and/or through her attorney is clearly
to blame for any
mistake that she might have laboured under regarding any material
matter when she entered into the settlement
agreement. There are
simply no facts which can sustain a finding that the applicant can
rely on either fraud or an iustus error.
[61] The respondent also
contended that the application must be dismissed as the relief will
not be effective in light of the fact
that the applicant has not
requested any relief regarding the agreement. The respondent’s
case is that the effect of rescission
of the judgment will be that a
valid agreement which contain the terms and conditions of the
settlement will continue to exist.
In light of the findings on the
merits of the application it is not necessary to consider this
contention.
[62] It is apposite to
point out that the applicant, at the outset of the arguments,
abandoned the special pleas raised in her affidavits
regarding the
denial of the authority of the deponent to the answering affidavit to
depose to the affidavit on behalf of the respondent
as well as
certain points based on the provisions of the
National Credit Act 34
of 2005
.
[63] Based on my findings
the application must be dismissed.
[64] The Mr de Wet argued
on behalf of the respondent that in the event that the application is
dismissed I should order the applicant
to pay cost on the scale as
between attorney and client. The argument is premised on the fact
that the applicant had no prospects
of success and the fact the
parties agreed in the settlement that the applicant would pay the
costs of action on the scale as between
attorney and client. Mr
Boonzaier on behalf of the applicant argued that no reasons exist for
a punitive cost order. Mr Boonzaier
submitted that I must find that
the application is
mala
fide
or
vexatious before I can make such an order as to costs. He strenuously
argued that the application is neither vexatious nor
mala
fide
.
[65] I am of the view
that the application was stillborn. In addition to the
afore-mentioned, the founding papers contain evidence
which are
clearly unfounded. At the very least it burdened the papers
unnecessarily i.e. the evidence regarding the fact that the
respondent never disclosed that it also relied on the ‘second
credit facility’. The respondent not only pleaded the
agreement
expressly, but also appended the application for a credit facility to
the declaration. This in turn clearly negated the
applicant’s
submission regarding the alleged overpayment and the fact that the
debt sued for did not exist. The same goes
for the averments
regarding the interest that could not be charged and the surety’s
obligations for future indebtedness other
than from the ‘first
credit facility’.
[66] In Nel v Waterberg
Landbouwers Ko-operatieve Vereeniging
9
it was held that the
purpose of an order that costs be paid on the scale as between
attorney and client is for the Court to ensure,
more effectively than
it can do by means of a judgment for party and party costs, that the
successful party will not be out of
pocket in respect of the expense
caused to him by the litigation. This matter, I believe, justifies a
special costs order.
[67] Counsel on behalf of
both parties was in agreement that the costs that were reserved
during the postponement of the matter
on 22 March 2012 must follow
the result.
[68] I therefore make the
following order:
The application is
dismissed with costs on the scale as between attorney and client.
Such costs are to include the costs reserved
on 22 March 2012.
____________________
N. SNELLENBURG AJ
7 May 2012
For the applicant: Adv.
MG Boonzaier
Instructed by
Bezuidenhouts Inc
For the respondent: Adv.
PJT de Wet
Instructed by Symington &
de Kok
1
[1984] ZASCA 51
;
1984
(3) SA 623
(A) at 634E – 635C.
2
Childerley
Estate Stores v Standard Bank of SA Ltd,
1924 OPD 163
at 166-8; De
Wet and Others v Western Bank Ltd,
1979 (2) SA 1031
(A) at 1039H –
1043A.
3
1985
(3) SA 968
(T).
4
See
footnote 1 supra.
5
[2005] ZAGPHC 118
;
2006
(4) SA 429
(TPD) at 431H – 432A
6
2000
(1) SA 126
(Z) at 132G;
1991 (4) SA 17
(ZS)
7
1978
(1) SA 914
at 921A – 923B
8
2008
(6) SA 264
(Ck) at 274C - H
9
1946
AD 597
i