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[2012] ZANCHC 48
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Ansa Mcgregor Properties CC and Others v Corporate Finance Solutions (Pty) Ltd (CA&R 73 /2012) [2012] ZANCHC 48 (21 September 2012)
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IN THE HIGH COURT OF
SOUTH AFRICA
(Northern Cape High
Court, Kimberley)
Case Nr: CA & R
73 /2012
Hearing : 17
September 2012
Judgment : 21
September 2012
In
the matter between:
ANSA MCGREGOR
PROPERTIES CC
..............................................
1
st
APPELLANT
ANNA MARGARETHA
McGREGOR
...............................................
2
nd
APPELLANT
CHARL GAVIN McGREGOR
...........................................................
3
rd
APPELLANT
and
CORPORATE FINANCE
SOLUTIONS (PTY) LTD
..................................
RESPONDENT
Coram: Olivier J et
Phatshoane J
JUDGMENT
Olivier J:
The first, second and
third appellants, Ansa McGregor Properties, Anna Margaretha McGregor
and Charl Gavin McGregor, were respectively
the first, second and
third defendants in an action instituted by the respondent,
Corporate Finance Solutions (Pty) Ltd, in the
Magistrates’
Court for the district of Kimberley.
The respondent’s
cause of action was a written contract in terms of which Technofin
(Pty)
Ltd had rented a copier to the
first appellant. The second and third appellants bound themselves as
sureties and co-principal
debtors for due payment of the monthly
rental by the first appellant. It was common cause that Technofin
had ceded its rights
in terms of the contract to the respondent.
In its summons the
respondent alleged;
that it had complied
with all its obligations and had delivered the copier to the first
appellant;
that the first
appellant had failed to make punctual monthly rental payments;
that the respondent
had therefore “
elected to claim immediate payment of all
amounts ….. due and all future rentals which would have
fallen due”.
The respondent based
its alleged election on the provisions of clause 13.9 of the
contract, which entitled the respondent, in
the event of such a
failure on the part of the fist appellant and after having “
given
the …
(first appellant)
7… days written notice
to remedy such breach…”
to;
“
13.9.1
terminate this Agreement, repossess the Device, claim all arrears
owing at date of termination, claim in its sole discretion
as pre
estimated liquidated damages all outstanding rentals which, but for
the termination, would have been payable for the remainder
of the
initial Hire Period, ……;or
13.9.2 without
terminating this Agreement, to treat as immediately due and payable
all rentals which would otherwise have become
due and payable in
terms hereof during the initial Hire Period to claim and recover from
the Hirer forthwith the aggregate amount
of such rentals as well as
all rental and other sums then in arrears in terms of this Agreement.
(The respondent)
shall, pending payment of those amounts, be
entitled to be
possessed
of the Device and to retain
possession thereof on condition that against such full payment
(the
respondent)
shall return the Device to the Hirer who shall not be
entitled to any rebate or abatement of rentals or other amounts by
reason
of its loss of possession and enjoyment of the device while
the same will have been in
(the respondent’s)
possession.”
It
was on this basis that the respondent, in the particulars of claim,
claimed payment of the amount of R27 624.60, interest on
this amount
and costs on the attorney and client scale
1
.
A notice of intention
to defend was filed on behalf of all three appellants, whereupon the
respondent applied for summary judgment
in these terms.
In an opposing
affidavit the following was stated;
It was apparently
admitted that the first appellant had failed to make punctual
monthly rental payments.
It
was alleged that by 1 March 2010 the arrears amounted to R8 310.66
and judgment in this amount
2
was
consented to.
It was furthermore
stated; however:
that the respondent
had repossessed the copier, without a court order, on 3 March 2010;
that the copier had
since then not been in the possession of any of the appellants;
that the respondent
had therefore not complied with its obligations in terms of the
contract;
that the balance of
the amount claimed was made up of monthly rental amounts for the
period from 1 March 2010 onwards;
that the respondent
was not entitled to any rental in respect of the period after the
repossession of the copier; and
that the application
for summary judgment should be dismissed with costs as far as that
part of the respondent’s claim was
concerned.
The magistrate
apparently found that the opposing affidavit did not disclose a
defence and granted summary judgment as prayed.
In
my view the appellants had
“‘
fully’
disclosed the nature and grounds of
(their)
defence
and the material facts upon which it
(was)
founded”
3
.
The material facts on which their defence was founded are the
allegations:
that the copier was
repossessed on 3 March 2010; and
that part of the
amount claimed represents monthly rental for the period after such
repossession.
The “
nature
and grounds
” of their defence was quite simply that the
respondent had not been entitled to monthly rental after the
repossession of
the copier, because it had, in respect of that
period and because of the fact that the first appellant had been
dispossessed
of the copier, not complied with its obligations in
terms of the written rental contract.
The
rental contract conferred reciprocal obligations on the parties
thereto
4
.
It obliged the respondent to deliver to the first appellant the
copier for the latter’s
“
use
and enjoyment”
thereof
and to
“
refrain
from doing anything which would deprive the lessee of the benefits
for which he contracted.”
5
,in
return for which the first appellant would be obliged to pay rental
as agreed
6
.
Compare
Sanddune
CC v Catt
7
:
“
If
for some reason the applicant should refuse or be unable to make the
leased premises available to the respondent, his obligation
to pay
rental would fall away.”
The
first appellant’s failure to pay the monthly rental punctually
would in the normal course of events have given the respondent
with
two options. It could have elected to either enforce the contract
and claim due rental payments as specific performance
or to
terminate and cancel the contract and claim supplementary relief
(like damages)
8
.
In this case the contract went further and also provided for a claim
for future rentals, an issue to which I will revert in
due course.
The
respondent’s election would have been final and the respondent
will bear the onus of proving what its election was
9
.
An
election to cancel has to be conveyed to the other party, and must
be clear and unequivocal
10
.
It can be communicated in a summons
11
.
It
may however be implied or inferred in certain circumstances, for
example from the service of a summons in which damages are
claimed
12
.
“
Whether
he has made an election one way or the other is a question of fact to
be decided by the evidence. If with knowledge of the
breach he does
an unequivocal act, which necessarily implies that he has made his
election one way, he will be held to have made
his election that way;
this
is however not a rule of law, but a necessary inference of fact from
his conduct” ……
13
.
When
regard is had to the remedies provided for in clause 13.9 of the
contract it appears that the combination of the repossession
of the
copier and a claim for future rentals would only be available where
the respondent had elected to terminate the contract
14
.
No such termination is
alleged in this particulars of claim.
It
could possibly be argued that the respondent’s repossession of
the copier amounted to an election to cancel the contract
15
,
that the first appellant had in the circumstance through the
repossession been made aware of this election and that the contract
had in the process effectively been cancelled. The respondent would,
however, not have been entitled to rely on this argument
for
purposes of its application for summary judgment.
[18.1] This was not the
case pleaded in the particulars of claim. No repossession was
alleged. It was also not alleged that the
contract had been cancelled
(even impliedly) and no cancellation thereof was claimed.
“
The
whole procedure of summary judgment was created to benefit the
plaintiffs. At the very least, therefore, it is expected of a
plaintiff, in presenting his case, to place himself squarely within
the four corners of the remedy. Any defects in the presentation
of
his case which are not merely technical and, for that reason, cannot
be condoned, will have as a consequence a refusal of summary
judgment, even if no
bona
fide
defence
has been disclosed by the defendant. A court will not assist a
plaintiff by breathing life into a poorly presented case
– on
the contrary the court will consider itself bound to the terms in
which the plaintiff has elected to formulate his claim.
Should it
appear that the plaintiff does have a claim, but not that presented
as the cause of action in the summons, the court
will refuse summary
judgment as it cannot be granted on a cause of action other than that
pleaded.”
16
.
[18.2]
The respondent’s application for summary judgment can also not
be supplemented by the contents of the opposing affidavit
17
.
[18.3]
In any event, the inference
18
of
such an implied election to cancel would not in my view have been
possible at the stage of the application for summary judgment,
and in
the absence of further evidence
19
.
It would, on the papers, not have been possible to exclude the
possibility that the repossession may have been intended as a
temporary measure and as a part of the specific performance remedy
provided for in clause 13.9.2 could not be excluded on the papers.
The respondent’s
cause of action is formulated as one would expect in the case of a
claim for specific performance. It is
alleged that “
The
Plaintiff has complied with all its obligations….. and the
goods have been delivered……..”
and that “
the
Plaintiff has elected to claim immediate payment of all amounts
which are due and all future rentals which would have fallen
due”
.
The claim for “
immediate”
payment of future
rentals corresponds with the wording of clause 13.9.2, which
envisages no termination of the agreement and
therefore specific
performance. There is no reference in the particulars of claim to
the future rentals representing “
pre estimated damages
”
as envisaged in clause 13.9.1.
An
unqualified and permanent repossession of the copier, whether by a
court order not, would be irreconcilable with a claim for
specific
performance
20
.
If
proved, it would therefore provide the appellants with a
bona
fide
defence
insofar as the respondent’s claim may be for specific
performance.
In my view the
magistrate should therefore not have granted summary judgment in
respect of the part of the claim which pertains
to the period after
the repossession of the copier.
The particulars of
claim in fact also contains no allegation to the effect that the
notice required in clause 3.9 had been given
to the first appellant.
Whether the particulars of claim, in the absence of such an
allegation, disclosed any cause of action
at all, was however not
raised on appeal and not argued before us.
Summary
judgment in respect of only the amount of the arrear rentals
21
would
have meant that the respondent would have been only partially
successful in its application for summary judgment. On the
other
hand there was no indication that the appellants had tendered the
arrears at an earlier stage. In these circumstances it
would in my
view have been fair to let each party pay its own costs of the
application.
As far as the costs of
the appeal are concerned, there is no reason why it should not
follow the result.
It follows that the
appeal must succeed.
[27]. I the premises I
make the following orders
:
The appeal
succeeds.
The magistrate’s
order is set aside and substituted with the following orders:
“
2.1
Summary judgment is granted in the amount of R8310.66 and interest
thereon at the rate on 15.5% per annum from 18 June 2010.
2.2 Summary judgment
for the balance of the amount of R27 624.60, claimed in
paragraph 1 of the application for summary judgment,
is refused and
the defendants are granted leave to defend the action in respect of
such balance.
2.3 Further
pleadings and notices are to be filed as if notice of intention to
defend the action was filed on 21 September 2012.
2.4 There will be no
order for costs and each party will pay its own costs.”
3. The respondent is
ordered to pay the costs of the appeal on a
party and party
scale.
______________________
C J OLIVIER
JUDGE
NORTHERN CAPE
DIVISION
I agree:
______________________
V M PHATSHOANE
JUDGE
NORTHERN CAPE
DIVISION
For the Plaintiff: Adv
Instructed by: KIMBERLEY
For the Respondent: Adv
Instructed by: KIMBERLEY
1
As
provided for in the contract.
2
As
well as interest thereon and costs.
3
See
Maharaj v Barclays National Bank
Ltd
1976 (1) SA
418
(AD) at 426 B-C
4
And
therefore also the respondent as cessionary.
5
The
Law of Sale and Lease
, 3rd edition, AJ
Kerr, pp 294 &296
6
Ibid
,
p 349
7
[1998]
JOL 1813
(SE), p 6
8
The
Law of South Africa,
2nd edition,
volume 14, part 2, p24:
The Law of Sale
and Lease, supra,
pp 361, 379 &
388.
9
Custom
Credit Corporation (Pty) Ltd v Shembe
1972
(3) SA 462
(A) at 469 H.
10
The
Law of Contract in South Africa
, 5th edition, Christie, p 539;
Putco Ltd v TV & Radio Guarantee Co (Pty) Ltd
1985 (4) SA
809(A)
830 E
; Kragga Kamma Estates CC v Flanagan
[1994] ZASCA 137
;
1995 (2) SA
367
(A) at 375 E - F
11
Compare
Middleburgse Stadsraad v Trans-Natal
Steenkool Korporasie Bpk
1987 (2) SA
244
(T) at 249 A- G;
Win Twice Property
(Pty) Ltd v Binos
2004 (4) SA 436 (W).
12
Du
Plessis v Government of Republic of Namibia
,
[1995] 4 All SA 66
(Nm) at 67
(1995 (1) SA 603
(Nm) at 605.
13
Segal
v Mazzur
1920 CPD 634
at 644- 645;
Du
Plessis and Another NNO v Rolfes Ltd
[1996] ZASCA 45
;
1997
(2) SA 354
(A); And compare
SA Wood
Turning Mills (Pty) Ltd v Price Bros (Pty) Ltd
1962
(4) SA 263
(T) at 266 H.
14
Clause
13.9.1
.
15
Compare
ABSA
Technology Finance Solution (Pty)Ltd v Leon Hattingh trading as –
Corner Savings Supermarket
[2009]
HOL 23504 (GNP) para [16]
16
Summary
Judgment * A Practical Guide,
Van
Niekerk
et al, p 10 para 11.2.3, -
17
………………………………………………………………
18
From
the repossession of the copier.
19
ABSA
Technology Finance Solution (Pty )Ltd v Leon Hattingh t/a Corner
Savings Supermarket,
supra, para [21].
20
ABSA
Bank Ltd v De Villiers & another
[2008]
JOL 22874
(C) para [17];
Varalla v
Jayandee Properties (Pty) Ltd
1969 (3)
SA 203
(T) at 206 E-207 A.
21
As
at the beginning of March 2010.