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[2012] ZAKZDHC 33
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Liberty Group Ltd v Singh and Another (9105/2011) [2012] ZAKZDHC 33; 2012 (5) SA 526 (KZD) (7 June 2012)
IN THE KWAZULU-NATAL
HIGH COURT, DURBAN
REPUBLIC OF SOUTH
AFRICA
CASE NO. 9105/2011
In the matter between:
LIBERTY GROUP LIMITED
…...................................................
PLAINTIFF
and
ROYCHAND SINGH
(I. D. No. )
….................................................................
FIRST
DEFENDANT
REETHA DEVI SINGH
(I. D. )
…..................................................................
SECOND
DEFENDANT
JUDGMENT
Delivered
07 June 2012
______________________________________________________
SWAIN J
[1] The defendants resist
an application for summary judgment which is sought against them
jointly and severally for payment of
the sum of R466,780.77, interest
on this sum, together with costs of suit on the attorney and client
scale, on the following grounds:
[1.1] The plaintiff’s
particulars of claim, forming part of the combined summons, was
signed by an attorney who was not qualified
to do so, in terms of the
Right of Appearance in Courts Act No. 62 of 1995 (the Right of
Appearance Act) as he had not been issued
with the requisite
certificate, by the Registrar of this Court in terms of Section 4 (2)
of the Act,
“to the effect that the applicant has the
right of appearance in the Supreme Court”
.
[1.2] The combined
summons was signed by an attorney, who was not qualified to do so, by
virtue of the fact that he had not been
enrolled by the Registrar of
this Court, in terms of Section 20 (3) of the Attorneys Act No. 53 of
1979 (the Attorneys Act) as
an attorney entitled in terms of Section
20 (4) of the Attorneys Act
“
to practise
.......and have all the rights and privileges and be subject to all
the obligations which he would have had and to which
he would have
been subject if he had been admitted and enrolled by (this) Court”
[1.3] The plaintiff had
failed to comply with Rule of Practice No. 28 of this Court, which
provides that in any action brought in
terms of the
National Credit
Act No. 34 of 2005
, the summons must allege that there has been
compliance with Section 129 of the Act and a certificate must be
attached to the summons
indicating compliance therewith.
[1.4] The plaintiff was
not entitled to claim the amounts in question, in terms of the
broking agreement concluded between the plaintiff
and the first
defendant, because the lapses that occurred in respect of policies
that the first defendant “
had written up”
had
been caused by the conduct of the plaintiff.
[2] Dealing firstly with
the validity of the combined summons, incorporating as they do, the
particulars of claim. It is common
cause, that the attorney who
signed the summons, as well as the particulars of claim, is admitted
and enrolled as such in the Gauteng
division of the High Court in
terms of the Attorneys Act, but has not been enrolled by the
Registrar of this Court in terms of
Section 20 (3) of the Attorneys
Act, as an attorney thereby entitled, in terms of Section 20 (4) of
that Act, to practice within
this division. It is also common cause
that the attorney was issued with a certificate, by the Registrar of
the Gauteng High Court,
in terms of Section 4 (2) of the Right of
Appearance Act, to the effect that he has the right of appearance in
the High Court.
[3] It is clear that in
terms of the Attorneys Act, an attorney is only entitled to practice
within the territorial jurisdiction
of the division of the High Court
in which he/she was initially admitted and enrolled. The right to
practice in another division
of the High Court, is dependent upon
enrolment of the attorney by the Registrar of the other division in
terms of Section 20 (3)
of the Attorneys Act.
Caietta &
another v Gess1988 (2) SA 395 (SWA)
S v Sewnandan
1999
(2) SA 1087
(O)
[4] The extent to which
the provisions of the Right of Appearance Act, have extended the
territorial rights of practise of attorneys
in the High Court, has
been the subject of a number of decisions. The provisions of the
Right of Appearance Act relevant to this
enquiry are the following:
“
Section 3
(4) An attorney who has been granted the right of appearance in the
Supreme Court shall also be entitled to discharge
the other functions
of an advocate in any proceedings in the Supreme Court “
and
“
Section 4
(4) An attorney who has been granted the right of appearance in terms
of this section shall be entitled to appear in any
court throughout
the Republic”
[5] In Sewnandan, which
was decided before the amendment of the Right of Appearance Act by
the insertion of Section 4 (4), it was
held that the issue of a
certificate by the Registrar of a division of the High Court, in
terms of Section (4) (2) of the Right
of Appearance Act, did not
entitle the attorney to appear before other divisions of the High
Court. The case was concerned only
with the right of appearance of an
attorney and not with any of the other functions of an attorney, or
“other functions of an advocate”
which
could be exercised by an attorney, in terms of Section 3 (4) of the
Right of Appearance Act.
[6] Subsequent to the
amendment of the Right of Appearance Act, by the insertion of Section
4 (4) (presumably to deal with the effect
of the decision in
Sewnandan) Tshabalala J P, had occasion to consider the effect of
this amendment, upon the rights of attorneys
to appear before, and
carry out the functions of an advocate in, divisions of the High
Court, other than the division of the High
Court in which they were
admitted and enrolled in terms of the Attorneys Act and other than
the division in which the certificate
of right of appearance was
issued.
Zeda Car Leasing
(Pty) Ltd. t/a Avis Fleet Services v Pillay
2007 (3) SA 89
(DCLD)
[7] At issue in Zeda was
whether an attorney who was not admitted and enrolled in the
KwaZulu-Natal Division of the High Court and
whose certificate of
right of appearance in terms of Section 4 (2) of that Act, was not
issued by the Registrar of that court,
was entitled to sign the
particulars of claim, forming part of a combined summons issued in
that division, qua attorney and qua
advocate, as required by the
Rules.
[8] Tshabalala J P
concluded that the amendment
“affects right of
appearance only and does not cover rights and obligations imposed by
the Attorneys Act”.
Zeda at at 94 G
[9] The reasoning of
Tshabalala J P was as follows:
“
To my mind,
the 2005 amendment is couched in broad terms which make it unclear
whether its ambit goes further than to extend the
right to appear by
also extending the area of jurisdiction. The section does not say
that an attorney may issue pleadings in any
Court other than where he
was enrolled. Furthermore, there is no indication of an intention to
do away with the control purported
in the Right of Appearance Act”.
Zeda at 94 B - C
Leaving aside for the
moment, the correctness of the decision reached by Tshabalala J P, as
to the effect of the provisions of Section
4 (4) of the Right of
Appearance Act, it is necessary to examine the correctness of the
decision in Sewnandan, forming as it did
the basis for the decision
of Tshabalala J P .
[10] The issue of control
over attorneys with right of appearance in divisions of the High
Court, other than the division in which
they were admitted or
enrolled, was central to the decision in Sewnandan. This arose from
Section 4 (3) of the Right of Appearance
Act which provides as
follows:
“
Section 21
of the Attorneys Act 1979 (Act 53 of 1979) which requires rolls of
attorneys to be kept, shall apply mutatis mutandis
in respect of
attorneys who have been granted the right of appearance in the
Supreme Court”.
[11] In Sewnandan Lombard
J, in whose Judgment Pretorius A J concurred, decided as a
consequence of the provisions of Section 4
(3), the Registrar of
every division of the High Court, was obliged to maintain four
registers containing details of attorneys
admitted in that division,
attorneys enrolled in that division, details of attorneys to whom
certificates of rights of appearance
had been issued by the Registrar
of that division and details of attorneys enrolled, who had applied
for certificates of right
of appearance, but to whom such
certificates had not been issued.
[12] In Sewnandan it was
held that this interpretation also satisfied the second main object
of the Right of Appearance Act (the
first main object being the
extension of the existing right of attorneys to appear in the courts)
which was
“
to ensure
that by extension of the right to appear in the Supreme Court, the
control over the professional conduct of attorneys
by their governing
body, the respective Law Societies, remains untouched, i.e. the same
control is maintained over these members
who are entitled to appear
in the Supreme Court as over those who are not. If there were to be
any difference in the control of
the two ‘types of attorneys’
this would frustrate one of the main purposes of the new Act, i.e. to
regulate and control
the right of attorneys to appear in the Supreme
Court by Statute. What the new Act has in essence brought about is
that, although
an attorney’s right to appear has been extended,
his or her ‘area of jurisdiction’ remained the same and
can
only be extended as set out in Section 20 of the Act”.
Sewnandan pg 1093 J –
1094 C
[13] The issue of control
over attorneys with right of appearance in the High Court, is central
to the conclusion which Tshabalala
J P reached in Zeda, agreeing as
he did with the conclusion reached in Sewnandan, that this was the
second main object of the Right
of Appearance Act.
Zeda at pg 93 B –
F
[14] In Sewnandan the
learned Judges accordingly concluded that an attorney’s right
of appearance in the High Court was not
unqualified and had to be
read with the provisions of Section 21 of the Attorneys Act (Section
4 (3) of the Right of Appearance
Act)
Sewnandan pg 1093
F
[15] With great respect
to the Judges in Sewnandan, I fail to see why the requirement in
Section 4 (3) of the Right of Appearance
Act, that a register be kept
of attorneys to whom right of appearance have been granted in that
division, with the object of maintaining
control over these
attorneys, leads to the conclusion that such an attorney’s
right to appear in the High Court, is limited
to the division in
which the attorney is admitted or enrolled in terms of Section 20 of
the Attorneys Act. The requirements in
terms of Section 4 (b) and (c)
of the Right of Appearance Act, that a certificate be provided by the
Secretary of the Law Society,
of which the attorney concerned is a
member, that he/she has practised for a period of not less than three
years and that there
are no proceedings to strike the attorney’s
name off the roll, or to suspend him/her from practise, ensures the
same level
of control for the issue of a certificate, as where the
attorney applies in a division , where he/she is admitted or
enrolled.
As regards the control of the conduct of attorneys, after
the issue of a certificate of appearance in terms of the Attorneys
Act,
if an attorney is struck off the roll, or suspended from
practise, the Registrar of the court concerned is obliged to forward
a
copy of the order to the Registrars of the other courts. On receipt
of such an order, the Registrar is obliged to enter a reference
to
that order opposite the name of the attorney concerned in the
register and the effect of such entry is that in the area of
jurisdiction of that court, the attorney concerned is removed from
the roll, or suspended from practise, as the case may be. Obviously,
this would have the effect of terminating the attorney’s right
of appearance, before any division of the High Court. In addition,
if
the conduct of an attorney appearing before a division of the High
Court, in which a certificate of appearance was issued, is
the
subject of a complaint, a reference to the register kept by the
Registrar, will ensure that the complaint is directed to the
Law
Society, of which the attorney is a member. The requirement that a
register be kept by the Registrar of all attorneys to whom
certificates of appearance have been issued in that division, has as
its object control over those appearing in a division, other
than a
division in which they are either admitted, or enrolled. The object
was not to limit the right of appearance, to a division
where the
attorney concerned was either admitted, or enrolled.
[16] In so far as
attorneys are concerned, the purpose of the Right of Appearance Act,
was not only to regulate the right of attorneys
to appear in courts,
but “
the object is stated in express terms to be to
extend an existing right”.
Society of
Advocates of Natal v de Frietas & another
(Natal Law Society
intervening)
1997 (4) SA 1134
(N) at 1172 E
In ascertaining the
meaning and effect of Section 4 (3) of the Right of Appearance Act,
“
consideration
must be given to the language used in the light of the ordinary rules
of grammar and syntax; the context in which
the provision appears;
the apparent purpose to which it is directed and the material known
to those responsible for its production.
Where more than one meaning
is possible, each possibility must be weighed in the light of all
these factors. The process is objective
not subjective. A sensible
meaning is to be preferred to one that leads to insensible or
unbusinesslike results or undermines the
apparent purpose of the
document”.
Natal Joint
Municipal Pension Fund v Endumeni Municipality
[2012] 2 All SA 262
(SCA) at 273 B – E
[17] The interpretation
of the Right of Appearance Act and specifically the control to be
exercised over attorneys to whom certificates
of appearance are
issued, adopted in Sewnandan, in my view, with respect, defeats the
purpose of the Act by over emphasising the
regulation of the
appearance of attorneys in the High Court, without according
sufficient weight to the object of extending such
right of
appearance. To limit the right of appearance, to a division where the
attorney was admitted or enrolled, unreasonably
limits the right of
appearance which was extended by the Right of Appearance Act. In
addition, as pointed out by Binns-Ward J in
Absa Bank v Barinor
New Business Venture
2011 (6) SA 225
at
229 A - B
such a construction also
gives rise to an absurdity, in that an attorney to whom a certificate
of right of appearance was issued
by the Registrar of a particular
division of the High Court, in which the attorney was enrolled, would
without further formality,
be entitled to appear before the Supreme
Court of Appeal and the Constitutional Court, but could not do so
before another division
of the High Court, without being enrolled in
that division.
[18] The decision in
Sewnandan, albeit that it is the decision of two Judges, is of
another division, and consequently not binding
upon me. I, with
respect, regard the decision as wrong.
[19] In Zeda, Tshabalala
J P, having accepted the correctness of the conclusion reached in
Sewnandan, concluded as follows
“
I therefore
accept the respondents’ assertion that the proper construction
to be placed upon the legal provisions is that
an attorney who holds
a certificate under s 4 (2) of the Right of Appearance Act may carry
out the functions of an advocate only
within the jurisdiction of the
Registrar by whom such attorney’s certificate was issued.
Furthermore that, if such attorney
wishes to exercise the functions
of an attorney or advocate in any other jurisdiction, that attorney
must apply under s 20 of the
Attorneys Act to be enrolled in that
other jurisdiction. Therefore, in the absence of being so enrolled,
it does not seem proper
that such attorney would be entitled to sign
pleadings as an advocate or attorney in a different Division from
where he/she was
enrolled”.
Zeda at pg 94 E - G
[20] It should be noted
that although Sewnandan was only concerned with an attorney’s
right of appearance, Tshabalala J P
applied the conclusion reached in
that case to
“the functions of an advocate”
to
be exercised by an attorney in terms of Section 3 (4) of the Right of
Appearance Act. This conclusion must necessarily follow
because the
right of an attorney to exercise the functions of an advocate, is
dependent upon the attorney possessing the requisite
right of
appearance. Tshabalala J P at no stage examined what the functions of
an advocate were in relation to the signature of
particulars of
claim, forming part of a combined summons and whether an attorney
with right of appearance, was entitled to exercise
such a function,
qua advocate.
[21] I, however, for the
reasons set out above, respectfully disagree with the conclusion of
Tshabalala J P that the right of appearance
of an attorney in terms
of Section 4 (2) of the Right of Appearance Act, is limited to the
division where the attorney is admitted
or enrolled, based as it is
upon the decision in Sewnandan. I respectfully regard the decision of
Tshabalala J P in this regard
as wrong. It also follows that I, with
respect, regard as wrong, the decision by Tshabalala J P, that the
ability of an attorney
to exercise the functions of an advocate, is
similarly restricted to the division where the certificate of the
right of appearance
was issued. Consequently, in my view, the
attorney in Zeda was entitled to exercise the functions of an
advocate in this division.
However, for reasons which I will set out
below, I respectfully agree with the conclusion of Tshabalala J P
that the attorney in
Zeda was not entitled to exercise the functions
of an attorney, in this division.
[22] In any event, I
regard the provisions of Section 4 (4) of the Right of Appearance
Act, as decisive. I, with respect, regard
as wrong the view of
Tshabalala J P that the provisions of this Section are not
“sufficiently cogent”
to conclude
that an attorney’s right to practise is
“without
any territorial restriction”.
Zeda at 94 C – D
[23] I agree with the
views of Binns-Ward J in
Barinor
supra
at 228 G – H
that Section 4 (4) was
merely expositionary legislation, the purpose of which was
“not
to alter the effect of an existing statutory provision, but merely to
express it more clearly, and to put its meaning
and effect beyond
debate”.
[24] Section 4 (4) is
quite clear in its terms that the attorney concerned is
“entitled
to appear in any court throughout the Republic”.
The
decision by Tshabalala J P in regard to the effect of Section 4 (4)
in any event, may be regarded as
obiter
,
because he states the following:
“
In any event
the pleadings herein were issued on 03 June 2005, before the said
2005 amendment”
Zeda at 94 G
[25] I am therefore
satisfied that the attorney in the present case, by virtue of the
issue of a certificate, by the Registrar of
the Gauteng High Court,
in terms of Section 4 (2) of the Right of Appearance Act, to the
attorney, acquired the right of appearance
before this Court.
[26] The next issue for
determination is whether the acquisition of a right of appearance
before this Court, afforded to the attorney
the right to sign the
particulars of claim in question, in terms of Section 3 (4) of the
Right of Appearance Act.
[27] The issue is whether
the signature of pleadings constitutes a
“function of an
advocate”.
In de Freitas at 1159 G Thirion J, in
whose Judgment Hugo J and P C Combrinck J concurred, referred to
“
the rule of
the common law that it is the function of the advocate to draw the
pleadings and the function of the attorney to file
the pleadings of
record as the representative of the party”.
[28] In the case of
Fortune v Fortune
1996 (2) SA 550
(C) at 551 D – E
Selikowitz J concluded
that
“
Amongst the
duties of an advocate which an attorney duly certified in terms of
Section 4 (2) of the Act, is entitled to discharge
is the signing of
pleadings. There can, in my view, be no doubt that pleadings,
although initially prepared and delivered prior
to any appearance
before the Court, nonetheless form an integral part of the
‘proceedings in the Supreme Court’ ”
[29] In Barinor,
Binns-Ward J, sitting in the Western Cape High Court, had to decide
whether an attorney with right of appearance
by virtue of a
certificate issued by a Registrar in another division, in terms of
the Right of Appearance Act, but who had not
been enrolled by the
Registrar of the Western Cape High Court, in terms of Section 20 (3)
of the Attorneys Act, was entitled to
sign a combined summons qua
attorney and qua advocate, issued in the Western Cape High Court. The
issue raised was consequently
the same as in Zeda and the present
case.
[30] Binns-Ward J after
referring to Section 3 (4) of the Right of Appearance Act, at 230 B
stated the following:
“
In respect
of the signature of pleadings, an attorney with right of appearance
could therefore sign the pleadings qua advocate and
qua attorney”
Binns-Ward J then
referred to the fact that prior to the substitution of Rule 18 (1) of
the Rules, this gave rise to the oddity
that attorneys exercising the
rights conferred by Section 3 (4) of the Right of Appearance Act, had
to sign the pleading twice,
once in discharge of the prescribed
function of the advocate and again in discharge of the prescribed
function of the attorney.
Reference was then made to the decision in
Fortune, where it was held that where a duly certified attorney signs
a pleading, in
place of an advocate, he or she should indicate that
fact by indicating that the attorney is certified in terms of Section
4 (2)
of the Right of Appearance Act.
Fortune at pg 551 H –
I
[31] Binns-Ward J then
set out a number of examples of other functions of an advocate, which
an attorney with right of appearance
under the Act might discharge
and concluded as follows:
“
[14] The
signature of pleadings by a legal practitioner is a function quite
discrete from the appearance in court. It precedes the
appearance and
it is ordinarily not done in court, but in an advocate’s
chambers or an attorney’s office. It was a
function undertaken
by attorneys, qua attorney – as distinct from qua advocate –
long before that branch of the profession
obtained a statutory basis
to exercise right of appearance in the superior courts. It is a
function which attorneys who do not
possess a certificate of right of
appearance can, and do, competently discharge”.
[32] Binns-Ward J then
referred to the amended provisions of Rule 18 (1) which provides for
the signature of a combined summons
by an advocate and an attorney,
alternatively in the case of an attorney with the right of appearance
in the High Court only by
such attorney and stated the following:
“
[15].......At
first blush that might be read as affording any attorney holding a
certificate issued in terms of s 4 (2) of the Act
the authority to
sign pleadings in any court in which he or she has the right of
appearance. That is not so. Apart from the fact
that the rules could
not in law override the effect of the relevant Acts, the term
‘attorney’ is in any event specially
defined in rule 1 to
mean ‘an attorney admitted, enrolled and entitled to practise a
such in the division concerned’.
An attorney admitted, enrolled
and entitled to practise as such in the Gauteng High Courts, for
example, has the right to appear
in the Western Cape High Court and
discharge the other functions of an advocate here if he or she has
been issued with a certificate
of right of appearance by a registrar
of the Gauteng High Courts, but he or she may not otherwise practise
as an attorney within
the jurisdiction of the Western Cape High Court
if he or she is not enrolled by the registrar of the Cape Court in
terms of s 20
of the Attorneys Act”.
[33] Binns-Ward J then
stated that the conclusion reached by Tshabalala J P in Zeda was
correct.
Barinor at 231 A
However, in Zeda,
Tshabalala J P, concluded that an attorney
“
may carry
out the functions of an advocate only within the jurisdiction of the
Registrar, by whom such attorney’s certificate
was issued”.
Zeda at 94 E – F
In the light of the
conclusion of Binns-Ward J, that Tshabalala J P was wrong, in
territorially limiting an attorney’s right
of appearance (with
the concomitant right to exercise the functions of an advocate) to
the division in which the attorney’s
certificate of appearance
was issued, I understand his approval of the decision of Tshabalala J
P to be restricted to that of the
inability of an attorney to sign
the combined summons qua attorney, but not qua advocate. In other
words, an attorney’s right
to sign a combined summons qua
attorney is limited to the division in which the attorney is admitted
or enrolled, but an attorney
with the right of appearance has the
right to sign a combined summons qua advocate, without such
limitation.
[34] If I have
misconstrued the judgment of Binns-Ward J and he intended not only to
limit the right of an attorney (with right
of appearance in the High
Court) to sign a combined summons qua attorney, but also qua
advocate, to the division where the attorney
was admitted and
enrolled, I respectfully disagree with it. If the reason for such a
conclusion by Binns-Ward J was that the signature
of pleadings is a
function ”
which is quite discreet from the appearance in
court”
and consequently not a function of an
advocate, which an attorney with a right of appearance can exercise,
I respectfully disagree
with it for the reasons set out below.
[35] As pointed out by
Selikowitz J in Fortune, the signature of pleadings is a function of
an advocate, forming an integral part
of
“any
proceedings in the Supreme Court”
that an attorney
who has been issued with the requisite certificate in terms of
Section 4 (2) of the Right of Appearance Act, is
entitled to exercise
in terms of Section 3 (4) of that Act.
[36] A combined summons
is a pleading
Dowson and Dobson
Industrial Ltd. v van der Werf & others
1981 (4) SA 417
(C)
at 422 C – E
and in terms of de
Freitas it was a rule of the common law that it was the function of
an advocate to draw the pleadings. Consequently
the attorney in the
present case was entitled to sign the combined summons issued out of
this division, qua advocate.
[37] The definition of
“attorney”
in Rule 1 means
“an
attorney admitted and enrolled and entitled to practise as such in
the division concerned”.
In the context of Rule 18
this means that an attorney with the requisite right of appearance,
can only sign a combined summons,
qua advocate and qua attorney, if
he or she has been admitted in that particular division. Although the
Rules of Court are delegated
legislation, have statutory force and
are binding on the Court
Western Bank Ltd. v
Packery
1977 (3) SA 137
(T)
at 141 B – C
the provisions of Rule
18, read together with the definition of
“attorney”
in Rule 1 cannot take precedence over the provisions of
the Right of Appearance Act, which confers upon an attorney certified
in
terms of the Act, the right to sign a combined summons qua
advocate, issued out of a division, other than the division in which
the Registrar issued such certificate.
[38] Whether such
certification, entitles the attorney to sign a combined summons qua
attorney, issued out of a division other than
the division in which
the Registrar issued the certificate is a different enquiry, to which
I now turn.
[39] When the matter was
argued I understood the challenge raised in the defendant’s
affidavit opposing summary judgment,
to be directed at the authority
of the plaintiff’s attorney to sign the combined summons qua
attorney, but not qua advocate.
Mr. Boulle, who appeared for the
plaintiff, submitted that the challenge was directed solely at the
authority of the plaintiff’s
attorney, to sign the combined
summons qua advocate. When I asked Mr. Tobias, who appeared for the
defendants, I understood him
to indicate that the challenge was
raised in respect of the ability of the attorney to sign the combined
summons qua attorney and
qua advocate. On examining the affidavit
more closely, it appears that the challenge was raised only in
respect of the ability
of the attorney to sign qua advocate. Be that
as it may, it is clear that a defendant in summary judgment
proceedings
“is not precluded from raising issues
relating to the validity of the plaintiff’s application merely
because he has
not referred to these matters in his opposing
affidavit”.
Arend & another
v Astra Furnishers (Pty) Ltd.
1974 (1) SA 298
(C)
at 314 B - C
cf H.K. Gopal (Pty)
Ltd. v Muthambi
1967 (3) SA 89
(T)
at 90 G - H
[40] The signature of the
combined summons by an attorney as required by Rule 18, as distinct
from the signature of the combined
summons by an advocate, has never
been the function of an advocate. A signature of the combined
summons, qua attorney, cannot accordingly
be justified in terms of
Section 3 (4) of the Right of Appearance Act, where the summons is
issued in a division, other than where
the attorney was admitted or
enrolled. The authority of an attorney to sign a combined summons
must accordingly be found within
the provisions of the Attorneys Act.
An attorney would be entitled to sign a combined summons, qua
attorney, issued in the division
in which he/she was admitted and
enrolled, or in a division in which he/she has been enrolled by the
Registrar of that division
in terms of Section 20 (3) of the
Attorneys Act, as an attorney thereby entitled in terms of Section 20
(4) of that Act, to practise
within that division. On the facts of
the present case, the plaintiff’s attorney was admitted and
enrolled in the Gauteng
High Court, and was accordingly not entitled
to sign the combined summons, qua attorney, which was issued in this
division, despite
the fact that the attorney possessed the right to
appear in this division.
[41] In this respect the
provisions of Rule 18, read with the definition of attorney in Rule
1, are in accordance with the provisions
of the Attorneys Act.
[42] Mr. Boulle sought to
argue that the provisions of Rule 17 were applicable on the present
facts and accordingly all that was
required was that the summons be
signed
“by the attorney acting for the plaintiff”
,
which did not require that the attorney be admitted in that division.
It is clear however, that the summons in this matter is
a combined
summons and accordingly the provisions of Rule 18 and not Rule 17,
are applicable. In any event
“attorney”
is
defined in Rule 1 in the manner set out above.
[43] In the alternative
Mr. Boulle submitted that this deficiency could and should be
condoned. In support of this proposition,
he referred me to an
unreported decision of Lopes A J (as he then was) in
B M W Financial
Services (SA) (Pty) Ltd. v Singh
KZN Case Nos.
2694/2009, 2695/2009
where in a summary
judgment application, the defendant as in the present case raised as
a defence a failure by the plaintiff to
comply with Rule of Practice
No. 28. Lopes A J held that the annexures to the summons constituted
more than substantial compliance
with the Practice Directive. He then
added that in any event, he condoned any perceived non-compliance
with the Practice Directive.
However in
Western Bank Bpk v
de Beer en ‘n ander
1975 (3) SA 772
(T)
at 775 D – E
Myburgh J in dealing with
an application by a plaintiff for condonation in summary judgment
proceedings, where the combined summons
had not been signed by an
advocate, had the following to say
“
Dit was ook
namens die eiser betoog dat die verweerder nie enigsinsbenadeel is
nie en dat ek die onreelmatige dagvaarding moet kondoneer.
Die harwar
wat deur die baster dagvaarding geskep is, is sulks dat ek nie geneig
is om daarop summiere vonnis te gee nie. Die verweer
dat dit ‘n
onreelmatige document is, is na my oordeel ‘n
bona
fide
verweer. Benadeling is nie noodwendigerwyse uitgesluit nie.
Inteendeel het mnr
Pickard
,
na my mening, met reg betoog dat die verweerder wel in sy verweer in
dié omstandighede benadeel is”.
The approach to be
adopted to procedural or technical irregularities, in a plaintiff’s
cause of action in summary judgment
proceedings, has been dealt with
in a number of cases. The high water mark in an insistence upon
procedural or technical regularity,
on the part of a plaintiff in
summary judgment proceedings is found in the remarks of Marais J in
the case of
Mowschenson &
Mowschenson
v
Mercantile
Acceptance Corporation of South Africa Ltd.
1959 (3) SA 362
(W)
at 366 F
where after pointing out
that summary judgment is a stringent remedy and that it can only be
granted if there is no doubt that the
plaintiff has an unanswerable
case, said the following:
”
If it is
reasonably possible that the plaintiff’s application is
defective or that the defendant has a good defence, the issue
must,
in my view, be decided in favour of the defendant”.
However in
van den Bergh v
Weiner
1976 (2) SA 297
(T)
at 300 B – C
the Full Bench endorsed
the view of Boshoff J in
W. M. Mentz &
Seuns (Bpk) v Katzoke
1969 (3) SA 306
at
311 A
that the passage in
Mowschenson was never intended to allow a defendant to raise any
technical point, no matter how insignificant,
and thereby defeat the
grant of summary judgment. It was never the intention to give weight
to purely technical defences because
that would defeat the object of
summary judgment proceedings.
[44] The remarks of
Myburgh J in Western Bank must however be seen in the context that
the irregularity in question was one of a
number of defects raised by
the defendant in that case. In addition, in the present case, Mr.
Tobias has not pointed to any prejudice
suffered by the defendants as
a consequence of the irregularity. When regard is had to the fact
that the point was only seized
upon by the defendant, when I raised
it at the hearing, I have no doubt that the irregularity should be
condoned. I accordingly
condone the irregularity.
[45] Turning to the issue
of whether the plaintiff has failed to comply with Rule of Practice
No. 28, which obliges the plaintiff
to allege in the summons that
there has been compliance with
Section 129
of the
National Credit Act
No. 34 of 2005
, and a certificate must be attached to the summons
indicating compliance therewith. Mr. Boulle’s answer to this
defence was
to submit that the agreement in question was not a credit
agreement in terms of the
National Credit Act No. 34 of 2005
. Mr.
Tobias however submitted that the agreement fell squarely within the
provisions of Section 8 (4) (d) of the Act as it was
a
“secured
loan”
within the definition of that term in
Section 1 of the Act.
[46] The agreement
between the parties is a broking agreement, in terms of which the
first defendant t/a KwaZulu-Natal Financial
Services, would submit
proposals from clients for various contracts to be issued by the
plaintiff. The first defendant would be
paid commissions on premiums
received by the plaintiff during the currency of such contracts. The
first defendant acted as an independent
contractor, was not entitled
to contract on behalf of the plaintiff, or to incur any liability on
behalf of the plaintiff. The
first defendant was also not authorised
to collect any monies on behalf of, or issue any receipts in the name
of the plaintiff.
[47] The clause which
forms the basis for the argument of Mr. Tobias that the agreement is
a
“secured loan”
reads as follows:
“
10.1 Any
advances made to the Brokerage at any time against commission to be
earned or amounts advanced to it for any other purpose
whatsoever,
shall constitute debts owed by the Brokerage to Liberty, which
Liberty may call upon to be paid at any time.....
10.2 As security for any present or
future indebtedness to Liberty the Brokerage hereby cedes to Liberty
its claim to all amounts
to which it may from time to time become
entitled hereunder. Liberty shall in its discretion and without
notice to the Brokerage
be entitled to set off any amounts owing to
it by the Brokerage from any cause whatsoever, against any
indebtedness of Liberty
to the Brokerage”.
[48]
“Secured
loan”
is defined in the
National Credit Act as
follows:
“
means an
agreement, irrespective of its form but not including an instalment
agreement, in terms of which a person –
advances money or grants credit to
another, and
retains, or receives a pledge or
cession of the title to any movable property or other thing of value
as security for all amounts
due under that agreement”.
[49] It is clear that
what is ceded by the first defendant to the plaintiff, are the
commissions which the plaintiff is liable to
pay to the first
defendant. The debts, the payment of which the parties seek to secure
by the cession, are advances made by the
plaintiff to the first
defendant in respect of these commissions, or amounts advanced by the
plaintiff for any other purpose.
[50] In the present case
the cause of action advanced by the plaintiff is pleaded as follows:
“
Pursuant to
the agreement and subsequent thereto the plaintiff advanced unearned
commission to the first defendant in respect of
contracts issued by
the plaintiff on proposals submitted by first defendant to plaintiff
prior to the plaintiff receiving any premiums
in respect thereof”.
It is then alleged that
contracts in respect of which unearned commission was advanced to the
first defendant lapsed or went out
of force, with the result that
unearned commission, that was paid in advance to the first defendant
has become repayable. It is
therefore clear that the amounts advanced
were solely in respect of unearned commission and not for any other
purpose.
[51] Consequently, in
terms of the cession, the cedent (first defendant) ceded his claim
for payment of commission against the debtor
(plaintiff) to the
cessionary (plaintiff) as security for the loan that the plaintiff
made to the cedent (first defendant). The
cession is one in
securitatem debiti
and
the respective capacities of the plaintiff and the first defendant
were not
“too incompatible to co-exist”
such
that
confusio
resulted
with the destruction of the parties’ mutual obligations.
Trust Bank of
Africa Limited. v Standard Bank of South Africa
1968 (3) SA 166
(A)
at 183 H – 184 F
Put differently, the
plaintiff did not as a result of the cession become its own creditor,
with a consequent merger of rights.
Roman Catholic
Church (Klerksdorp Diocese)
v
Southern Life
Association Limited
1992 (2) SA 807
(A)
at 815 H – 816 A
This is because the
advances were made against unearned commission, in respect of which
there was no obligation on the plaintiff
to make payment to the first
defendant, and the first defendant was not entitled to claim payment,
as commission was not yet due
and payable.
[52] The significance of
this is that for the purpose of determining whether this agreement
constitutes a
“secured loan”
in terms
of the
National Credit Act, there
was a valid cession by the first
defendant of his right to claim payment of commission. The crucial
issue however, is whether this
particular type of cession is one
which is comprehended by the definition of a
“secured
loan”.
What is required is a cession of an
“other
thing of value as security for all amounts due under that agreement”.
It is clear that the
“thing of value”
has to be something other than the
“amounts
due under that agreement”
, and not simply a
“thing
of value”
, other than
“any movable
property”
. What is due by the first defendant
under the agreement is advances of unearned commission by the
plaintiff and the
“thing of value”
which
has been ceded, is the first defendant’s claim to payment of
that very commission, when it becomes due and payable.
[53] The cession in
question is accordingly not one which falls within the definition of
a
“secured loan”
in terms of the
National Credit Act. There
is accordingly no obligation upon the
plaintiff to comply with Rule of Practice 28, nor the procedure
specified in the
National Credit Act.
[54
] The final defence
raised by the defendants relates to the merits of the plaintiff’s
claim. As pointed out above, the defendants
allege that lapses in
policies were caused by the conduct of the plaintiff in the following
respects:
[54.1] The plaintiff
incorrectly captured stop orders as debit orders on a number of
policies.
[54.2] Only one stop
order could go through on the accounts of certain customers, but the
plaintiff attempted to pass double debit
orders on these accounts,
with the result that premiums were not paid.
[54.3] The plaintiff’s
systems failed, causing a number of lapses in policies, which ought
not to have occurred.
[55] What is clear is
that the allegations of the defendants are entirely lacking in any
particularity. If the allegations of the
defendants were
bona
fide,
I would have expected the defendants to set out the
material facts upon which they are based. The defendants rely upon
three different
causes for the lapsing of policies, and in order to
draw such a distinction, if
bona fide,
I would expect details
of the policies concerned, as well as the amounts advanced by the
plaintiff in respect of these policies.
This is because the
defendants do not deny that the plaintiff advanced unearned
commissions to the first defendant, or that policies
in respect of
which advances were made, lapsed. The first defendant should
accordingly be able to furnish these details, particularly
as the
first defendant was the broker who submitted proposals in respect of
each of these lapsed policies. In addition, the defendants
allege
that a number of the plaintiff’s claims have prescribed, again
without furnishing any material facts upon which this
allegation is
based. I am accordingly satisfied that the defendants have failed to
establish that they have a valid and
bona fide
defence to the
plaintiff’s claim.
[56] The plaintiff seeks
costs on the attorney and own client scale against both defendants.
However, only the Deed of Suretyship
contains a consent to pay costs
on this scale. Although the Deed of Suretyship purports to be one in
which both defendants stand
surety for the debts of KwaZulu-Natal
Financial Services, it is clear from the plaintiff’s
particulars of claim and the agreement,
that this is a firm of which
the first defendant is the sole proprietor. The suretyship agreement
in so far as it relates to the
first defendant is consequently
unenforceable. A costs order on the attorney and own client scale can
accordingly only be advanced
against the second defendant.
I make the following
order:
Summary judgment is
granted against the first and
second defendants,
jointly and severally, the one paying the other to be absolved for:
Payment of the amount of
R466,780.77
Interest at the rate of
15.5% per annum
a tempore mora
from 20 November 2009 to date
of payment.
Costs of suit against
the first and second defendants jointly and severally, including
costs on the attorney and own client scale
as against the second
defendant
___________
K. SWAIN J
Appearances: /
Appearances:
For
the Plaintiff :
Mr. A. Boulle
Instructed by
:
Gerings Attorneys
C/o Hassen, Parsee &
Poovalingham Attorneys
Durban
For 1
st
& 2
nd
Defendants
:
Mr. D.
G. Tobias
Instructed
by :
J. Surju Durban
Date of Hearing
:
11 May 2012
Date of Filing of
Judgment :
07 June 2012