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[2011] ZAKZDHC 77
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Firstrand Bank Ltd v Louw and Another (1386/2011) [2011] ZAKZDHC 77 (25 August 2011)
IN THE
KWAZULU-NATAL HIGH COURT, DURBAN
REPUBLIC OF SOUTH
AFRICA
CASE NO:
1386/2011
In the matter
between:
FIRSTRAND BANK
LIMITED
…...........................................................
Plaintiff
and
CASPER FANIE LOUW
…..............................................................
1
st
Defendant
HOT GOSSIP
TRADING (PTY) LTD
….......................................
2
nd
Defendant
ORDER
Date:
25
August 2011
The application for
summary judgment is dismissed with costs. The defendants are given
leave to defend the action.
Judgment
Date:
August 2011
Ploos van Amstel, J
[1] This is an
application for summary judgment. The main issue (there are others)
is whether the affidavit which accompanies the
application complies
with the requirements of rule 32(2) of the Uniform Rules.
[2] In Maharaj v
Barclays National Bank Ltd
1
Corbett, J.A. (as he
then was) emphasised the extraordinary and drastic nature of the
remedy of summary judgment. He said that while
undue formalism in
procedural matters is always to be eschewed, it is important in such
applications that, in substance, the plaintiff
should do what is
required of him by rule 32(2).
[3] The plaintiff in
this matter sues on two suretyships in terms of which the defendants
bound themselves as sureties and co-principal
debtors in respect of
monies owing to the plaintiff by a company known as Busy Bag And Belt
(Pty) Ltd (‘the company’).
[4] The claims
against the company arise out of three loan agreements, respectively
for the sums of R1 m, R440 000 and R1 206 000.
The company went into
liquidation on 4 December 2009, which triggered an acceleration
clause in each of the agreements. The amount
of the claim in the
particulars of claim is the sum of R2 747 838.37, together with
interest and costs. At the hearing I was informed
by counsel for the
plaintiff that the plaintiff had received the proceeds of the sale of
a property which was owned by the company,
the result of which is
that the amount owing was reduced to the sum of R 117 188,40. That is
the amount for which the plaintiff
now seeks summary judgment,
together with interest and costs.
[5] The affidavit in
support of the application for summary judgment was deposed to by one
Barend Johannes de Beer, who described
himself as ‘the legal
manager of the plaintiff and a non-practising attorney.’ He
further stated as follows: ‘…
the facts deposed to
herein are true and correct and are within my personal knowledge save
where the contents indicate the contrary,
in which event they are to
the best of my belief both true and correct… (I am) presently
administering and therefore have
personal knowledge of and insight
into the records of the plaintiff relating to the first and second
defendants. I hereby swear
positively to the facts verifying the
cause of action and amount claimed by the plaintiff against the first
and second defendants
and I state that in my opinion, the first and
second defendants do not have a bona fide defence to the action and
that a notice
of intention to defend has been delivered solely for
the purposes of delay.’
[6] Counsel for the
defendant submitted that this does not comply with the requirement in
rule 32(2) that the affidavit must be
made by the plaintiff or by any
other person who can swear positively to the facts and verify the
cause of action and the amount
claimed, if any. He relied in this
regard on the judgment of Wallis J (as he then was) in Shackleton
Credit Management (Pty) Ltd
v Microzone Trading 88 CC And Another
2
.
[7] The facts in
Shackleton were different. In that case the plaintiff sued as a
cessionary of claims which Absa Bank had against
the defendant
arising out of lease agreements concluded between them in respect of
various motor vehicles. It alleged that the
defendant breached the
agreements by failing to pay instalments timeously, that Absa
cancelled the agreements, retook possession
of the vehicles and
caused them to be sold. In respect of each claim the plaintiff sought
to recover an amount by way of damages,
calculated as the difference
between the balance outstanding under the lease agreement at the date
of cancellation, less unearned
finance charges, and the proceeds of
the sale of the vehicle. The affidavit in support of the application
for summary judgment
was deposed to by the plaintiff’s attorney
of record, who familiarised himself with the facts by perusing the
files which
the plaintiff had obtained from Absa. It is not difficult
to see why the court concluded that the affidavit consisted of
hearsay
evidence and did not comply with rule 32(2).
[8] In the present
case the affidavit was deposed to by an employee of the plaintiff who
said that he (was) ‘presently administering
and therefor have
personal knowledge of and insight into the records of the plaintiff
relating to the first and second defendants.’
It seems to me
that two issues arise. The first relates to the question whether the
deponent had the required knowledge and the
second to what he
actually swore to and verified.
[9] In Barclays
National Bank Ltd v Love
3
it was alleged in
the summons that the amount claimed was due and payable and was in
respect of money lent and advanced on overdraft
by the plaintiff to
the defendant, the rate of interest having been agreed. The affidavit
in support of the application for summary
judgment
was
made by the manager of the plaintiff’s Stanger branch, where
the defendant had his bank account. All he said was that
he was the
manager of the branch and that he verified that the defendant was
indebted to the plaintiff in the sum claimed on the
grounds set out
in the summons. He then stated that in his opinion the defendant had
no
bona
fide
defence
to the action and that the notice of intention to defend had been
delivered solely for the purpose of delay. Miller J (as
he then was)
said at 515 H that a deponent’s ability to swear positively to
the facts is a
sine
qua non
to
the effectiveness, for the purpose of summary judgment, of any
deposition he may make. Whether the deponent is a person able
to
swear positively to the facts will depend largely upon what he says
in the affidavit but the
ipse
dixit
of
the deponent will not necessarily be sufficient to establish the
necessary qualification. At 516 A-B he said that although it
is not
necessary for the deponent to state reasons in the affidavit for his
assertion that the facts are within his own knowledge
he should,
where he is not the plaintiff himself, at least give some indication
of his office or capacity which would show an opportunity
to have
acquired personal knowledge of the facts to which he deposes.
[10] He went on to
say at 516 C-D: ‘What emerges from the affidavit made by
Williams, read with the summons which is referred
to therein, is that
he is the manager of the Stanger branch of the plaintiff bank, that
the overdraft facilities were afforded
the defendant by that branch
and that the amounts claimed by plaintiff in the summons are due and
owing in respect of the grant
by the bank of such facilities. Those
are the facts which he verifies …’. At 516 H-517 A: ‘
We are concerned
here with an affidavit made by the manager of the
branch of the bank at which overdraft facilities were enjoyed by the
defendant.
The nature of the deponent’s office in itself
suggests very strongly that he would in the ordinary course of duties
acquire
personal knowledge of the defendant’s financial
standing with the bank. This is not to suggest that he would have
personal
knowledge of every withdrawal of money made by the defendant
or that he personally would have made every entry in the bank’s
ledgers or statements of account; indeed, if that were the degree of
personal knowledge required it is difficult to conceive of
circumstances in which a bank could ever obtain summary judgment. It
goes without saying that a manager of a bank who claims to
have
personal knowledge to the extent to which a client has overdrawn his
account must needs rely upon the bank records which show
the amounts
paid into his account and the amounts withdrawn by the client. When
such a manager says that he knows or believes that
the client is
indebted to the bank in a specified sum of money, it is implicit in
what he says that he has had regard to the bank
records and that he
accepts …. that they give a true reflection of the state of
the clients account’.
[11] In Sand and Co
Ltd v Kollias
4
the deponent said
that he was a director of the plaintiff, that the facts in the
affidavit were within his knowledge, that the defendant
was truly and
lawfully indebted to the plaintiff in the sum claimed and on the
grounds stated in the summons, and that he did not
believe that the
defendant had a bona fide defence. Trollip J (as he then was)
rejected a challenge to the adequacy of the affidavit.
He said ex
facie the affidavit there was nothing to cast any doubt upon the
ability of the deponent to swear positively to the
facts, and the
defendant in his opposing affidavit did not dispute his ability to do
so. He held that it was not necessary for
the deponent to set out the
means or sources of his knowledge. He thought it advisable for a
deponent to use words such as ‘own’,
‘personal’,
or ‘direct’ to emphasise that he ‘can swear
positively to the facts’ as required
by the rule. He added that
the omission of such a word of emphasis does not necessarily render
the affidavit defective if it appears
from the affidavit as a whole
or from all the documents relating to the proceedings that he ‘can
swear positively to the
facts’. He held that the affidavit by
the director complied with the rule.
[12] In Misid
Investments (Pty) Ltd v Leslie
5
Munnik A.J. (as he
then was) said at 474 G that the affidavit, if not made by the
plaintiff himself, must be deposed to by a deponent
who belongs to a
particular class of persons, namely, persons who can swear positively
to the facts.
[13] In Maharaj
6
Corbett JA said that
the court entertaining the application for summary judgment must be
satisfied,
prima
facie
,
that the deponent is a person who is able to swear positively to the
facts. Generally speaking, before a person can swear positively
to
facts in legal proceedings they must be within his personal
knowledge. For this reason the practice has been adopted of requiring
that a deponent to an affidavit in support of summary judgment, other
than the plaintiff himself, should state, at least, that
the facts
are within his personal knowledge (or make some averment to that
effect) unless such direct knowledge appears from other
facts stated.
The mere assertion by a deponent that he can ‘swear positively
to the facts’ (an assertion which merely
reproduces the wording
of the rule) is not regarded as being sufficient, unless there are
good grounds for believing that the deponent
fully appreciated the
meaning of these words.
[14] In Standard
Bank of SA Ltd v Secatsa Investments (Pty) Ltd
7
Van Heerden AJ (as
she then was) said at 235 A – B that first-hand knowledge of
every fact which goes to make up the plaintiff’s
cause of
action is not required and that, where the plaintiff is a corporate
entity, the deponent may well legitimately rely for
his or her
personal knowledge of at least certain of the relevant facts and his
or her ability to swear positively to such facts,
on records in the
company’s possession. But Wallis J said in Shackleton
8
that he did not
understand any of the cases as going so far as to say that the
deponent to an affidavit in support of an application
for summary
judgment can have no personal knowledge whatsoever of the facts
giving rise to the claim, and rely exclusively on the
perusal of
records and documents in order to verify the cause of action and the
facts giving rise to it.
[15] Returning to
the affidavit in the present matter, the deponent says: ‘…the
facts deposed to herein are true and
correct and are within my
personal knowledge save where the contents indicate the contrary…’.
But the ‘contents’
do indicate the contrary. There is no
unequivocal statement that he has personal knowledge of the facts. He
is a legal manager
in the employment of the plaintiff and probably
concerned with recoveries. His name does not appear on the
contractual documents
which are annexed to the particulars of claim.
There is nothing to indicate that he falls within a class of persons
who have the
required knowledge. Every indication is that he relied
solely on the plaintiff’s records. And he says he did so
‘relating
to the first and second defendants’. He says
nothing about his knowledge with regard to the liability of the
principal debtor,
which in turn determines the liability of the
defendants as sureties.
[16] In the
circumstances I am not satisfied that the affidavit complies with
rule 32(2). It follows that the application for summary
judgment is
defective and cannot succeed.
[17] There is a
further matter with regard to the affidavit which I should mention.
The deponent says: ‘ I swear positively
to the facts verifying
the cause of action…’. The facts do not verify the cause
of action. It is the deponent who
must verify the cause of action. In
Fischereigesellschaft F Busse & Co Kommanditgesellschaft v
African Frozen products (Pty)
Ltd
9
Theron
J said that rule 32(2) should be read as if a comma had been inserted
after the word ‘facts’. In other words,
the affidavit
must be made by the plaintiff or by any other person who can swear
positively to the facts, and verify the cause
of action and the
amount, if any. This was confirmed by Corbett JA in Maharaj vs
Barclays National Bank Ltd.
10
[18] The application
is dismissed with costs and the defendants are granted leave to
defend the action.
___________________________
PLOOS VAN AMSTEL J
1
1976
(1) SA 418
AD at 423 E-F
2
2010
(5) SA 112
KZP
3
1975
(2) SA 514
D
4
1962
(2) SA 162
W
5
1960
(4) SA 473
WLD
6
Supra,
at 423 A-B
7
1999
(4) SA 229
C
8
Supra,
at 118 E
9
1967
(4) SA 105
C
10
Supra,
fn 1, at 422