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[2008] ZANCHC 54
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Tiger Consumer Brands Limited v Steyn and Others (1236/2007) [2008] ZANCHC 54 (4 July 2008)
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IN THE HIGH COURT OF
SOUTH AFRICA
(Northern Cape
Division)
Case
Nr:
1236/2007
Case
Heard:
27/06/2008
Date
delivered:
04/07/2008
In
the matter between:
Tiger
Consumer Brands Limited
PLAINTIFF
and
Johannes
Lodewyk Steyn
1
st
DEFENDANT
Bernnita
Steyn 2
nd
DEFENDANT
Leach
Auto CC 3
rd
DEFENDANT
Firstrand
Bank Limited
4
th
DEFENDANT
Standard
Bank of South Africa 5
th
DEFENDANT
The
Registrar of Deeds 6
th
DEFENDANT
JUDGMENT
Olivier J:
In
it
s
summons the plaintiff, Tiger Consumer Brands Limited, alleges:
that
the first and second defendants, Johannes Lodewyk Steyn and
Bernnita Steyn, are indebted to it in the amount of R1 065
024.83
in their capacities as sureties and co-principal debtors of Motogo
Distributors CC;
that
the first and second defendants sold their immovable property to
the third defendant, Leach Auto CC;
that
“
33. The
Sale Agreement was entered into and the transfer of property took
place with the intention of defrauding the Plaintiff and
the other
creditors of the First and Second Defendants.
The Third Defendant
accepted transfer of the property with knowledge of the fraud.
The First and
Second Defendants are unable to make payment of any amounts due to
the Plaintiff.
As
a result of the foregoing fraud, Plaintiff is unable to recover its
claim from the First and Second Defendants.
”;
that the purchase
price of R900 000,00 was paid by the third DEFENDANT, who then took
transfer of the property;
that a mortage bond
was registered over the property by the third defendant in favour
of the fourth defendant, Firstrand Bank
Limited; and
that a mortage bond
which had been registered over the property by the first and second
defendants in favour of the fifth defendant,
Standard Bank of South
Africa Limited, was cancelled.
The
plaintiff claims
,
inter
alia
,
payment of the amount of R1 065 024.83 by the first and second
defendants, as well as an order;
“
Setting
aside the sale and transfer of the immovable property known as Erf
171, Kuruman held under title deed T156/2000 as between
the First and
Second Defendants to the Third Defendant.
”
The
plaintiff joined the fourth defendant on the basis of it being an
“
interested
”
party and claims no relief against it.
The
fourth defendant
excepted
to the plaintiff’s particulars of claim on the basis of it
being vague and embarrassing to such an extent that
the fourth
defendant is unable to plead thereto.
Although
the fourth defendant’s notice of exception is ten pages long
and comprises of no less than 24 pa
ragraphs
and subparagraphs, its rather prolix contents can be deciphered and
unravelled to boil down to basically two complaints:
The
first complaint is that the plaintiff had failed to “
make
it clear … whether or not it is the true intention of the
Plaintiff to unwind the transaction in totality such that
the
Excipient is repaid the full amount of the loan advanced by it to
the Third Defendant and in respect of which the mortage
bond by the
Third Defendant has been executed unto and in favour of Excipient
”.
In
its notice of exception the fourth defendant also claimed to be
embarrassed by a difference between the description of the
creditor
in the deed of suretyship and the description of the plaintiff in
the combined summons.
In
the heads of argument on behalf the fourth defendant no mention was
made of the second complaint, and in my view wisely so,
and it will
therefore for the purposes of this judgment be regard
ed
as having been abandoned.
I am of the view that
the first complaint is also devoid of any merit.
The
contention seems to be that the plaintiff should have detailed “
the
consequence which an order as prayed will have on the Excipient
”.
There is no obligation on the plaintiff to do so. The legal effect
of an order setting aside the sale and transfer
in circumstances
such as these can be easily determined by the reference to any
textbook on contract.
In
fact, the fourth defendant contradicts itself by stating (also in
its notice of exception) that the effect of the order “
will
be to unwind the legal and commercial procedures which have occurred
in consequence of the transaction, such that the Excipient
ought to
be repaid the loan amount advanced by it to the Third Defendant
”.
If this would according to the fourth defendant be the legal effect
of such an order, why should the plaintiff have
explained it to the
fourth defendant in its particulars of claim?
It is so that the
setting aside of the transfer would impact upon the fourth
defendant’s security for the loan granted to
the third
defendant. Such an order would mean that the third defendant in
effect never acquired ownership of the property, or
the right to
hypothecate it as security for a loan.
Should
the plaintiff then also succeed in its claim against the first and
second defendants and have the property attached in
execution, the
fourth defendant would have no security for the repayment of the
amount of the loan. This has, however, not yet
happened and the
fourth defendant’s remedies in this regard would clearly be
against the third defendant and/or the first
and second defendants,
and not against the plaintiff (compare
Menqa
and Another v Markom and Others
2008 (2) SA 120
(SCA) at 130).
The
fourth defendant’s references to a “
cause
of action against the Fourth Defendant
”,
“
the
whole cause of action in respect of the Fourth Defendant
”
and the possibility that the relief claimed by the plaintiff “
is
intended to deprive the Fourth Defendant of the benefits of the
mortage bond
”
are misconceived. The plaintiff is not claiming any relief against
the fourth defendant and the relief claimed by it
is not “
intended
”
(in the sense of being aimed at) to deprive the fourth defendant of
anything, but rather to have the consequences of the
transaction
between the first and second defendant and the third defendant
undone as far as the plaintiff is affected thereby.
The
relief claimed against the first and second defendant’s and
the third defendant may affect the fourth defendant’s
rights
in terms of the mortage bond, and possibly its rights regarding the
loan agreement apparently concluded between it and
the third
defendant, but it was certainly not incumbent upon the plaintiff to
address those rights in its particulars of claim.
The allegations in the
particulars of claim are sufficiently clear to enable the fourth
defendant to resist the setting aside
of the sale and transfer
(should it have a basis for such a defence) or to take steps against
the third defendant (either by
way of a third party joinder or in a
separate action) to recover the money advanced to the third
defendant.
The
plaintiff therefore correctly joined the fourth defendant in its
action (without claiming relief against it), but it had absolutely
no obligation to take or explain steps to recover the loan amount or
any damages that the fourth defendant may suffer in the
event of the
property being attached in execution.
It follows that I am
of the view that the exception should be dismissed. There is no
reason why costs should not follow the result
and none was suggested
to me.
The following order is
therefore made:
The exception is
dismissed with costs.
________________________
C J OLIVIER
JUDGE
NORTHERN CAPE
DIVISION
For the
Plaintiff:
Adv
W H Coetzee
Instructed
by:
Engelsman Magabane Inc. KIMBERLEY
For the
fourth defendant: Adv J Schreuder
Instructed
by: Elliott, Maris, Wilmans & Hay, KIMBERLEY