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[2008] ZAWCHC 55
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Vincemus Investments (Pty) Limited v Laher (4099/2008) [2008] ZAWCHC 55 (26 September 2008)
REPORTABLE
IN
THE HIGH COURT OF SOUTH AFRICA
(CAPE
OF GOOD HOPE PROVINCIAL DIVISION)
CASE
NO: 4099/2008
In
the matter between:
VINCEMUS
INVESTMENTS (PTY) LIMITED
Applicant
and
AHMED
LAHER
Respondent
and
ABSA
BANK LIMITED
Intervening
Creditor
For
the Applicant:
Adv. L.
Buikman
Attorneys:
Korbers Inc
For
the Respondent:
Adv. M.E. Stewart (Durban Bar)
Attorneys:
Pillay Nicols Hlahane
For
the Intervening
Creditor:
Adv. D.J. van der Walt (Bloemfontein)
Attorneys:
Sandenbergh Nel Haggard
Date
of hearing(s):
18 August 2008
JUDGMENT:
26 September 2008
REPORTABLE
IN
THE HIGH COURT OF SOUTH AFRICA
(CAPE
OF GOOD HOPE PROVINCIAL DIVISION)
CASE
NO: 4099/2008
In
the matter between:
VINCEMUS
INVESTMENTS (PTY) LIMITED
Applicant
and
AHMED
LAHER
Respondent
and
ABSA
BANK LIMITED
Intervening
Creditor
JUDGMENT: 26 SEPTEMBER 2008
VAN
REENEN, J:
1]
This is an opposed application for the provisional sequestration of
the respondent’s estate based
on an unsatisfied judgment debt
for the payment of an amount of R1165105,70, interest and costs
pursuant to a judgment granted
by the Natal Provincial Division on
13
th
November 2007.
2]
The respondent did not initially file a notice of opposition but
appeared in person on 14 March 2008
to request a postponement with a
view to considering his position and as a consequence the matter was
postponed to 8 April 2008.
3]
On that date however, Absa Bank Limited (Absa) applied for and
was granted leave to intervene and
by agreement between the parties a
time-table was determined for the filing of affidavits and heads of
argument.
4]
In terms of the said time-table the respondent was obliged to have
filed his answering affidavit by 30
May 2008 but failed to do so.
The respondent filed his notice of opposition and his answering
affidavit with the registrar
of this court only on 14 August 2008.
When the matter was argued on 18 August 2008 I requested to be
provided with an explanation
on oath for the late filing of the
answering affidavit as well as an application for condonation of the
delay. The respondent’s
attorney of record has now
provided me with a detailed explanation, the gravamen whereof is that
the candidate attorney to whom
the matter had been entrusted
abandoned his/her articles of clerkship during June 2008 and that
his/her neglect to have given effect
to instructions regarding the
conduct of the matter only manifested itself afterwards. As it,
in my view, would be unfair
to penalise the respondent for the
administrative shortcomings on the part of those professionally
qualified persons to whom he
had entrusted his affairs, the failure
to have timeously filed the answering affidavit is condoned.
5]
The only basis on which both the respondent and Absa oppose this
application is that it would not be
to the advantage of the
respondent’s creditors, within the meaning thereof in section
10(c) of the Insolvency Act No 24 of
1936 (the Act) if his
estate were to be sequestrated. By necessary implication the
applicant’s locus standi as
well as the acts of insolvency on
which it relies have not been placed in issue.
6]
The thrust of the applicant’s case, as regards advantage to
creditors is firstly, that the
“equity” in the
respondent’s immovable properties in Johannesburg and Cape Town
are approximately R50 000 and
that on the basis of his version the
“equity” in an immovable property situate in
Pietermaritzburg is R200
000 and; secondly, that there is
a possibility that he owns other assests that have not been disclosed
and that his true
financial position is likely to be fully revealed
only through an enquiry in terms of the provisions of section 152 of
the Act.
7]
The gravamen of Absa’s case is that the applicant failed to
adduce sufficient admissible proof
that, prima facie, there is reason
to believe that the sequestration of the respondent’s estate
will be to the advantage
of his creditors especially if regard is had
thereto that immovable properties at forced sales yield less than
market-value as
well as that, if the costs of sequestration and
realization are taken into account, there is likely to be a
short-fall in respect
of which it would merely be a concurrent
creditor. As regards the applicant’s reliance on an
enquiry in terms of section
152 of the Act to determine the existence
of other assets that could be realised for the benefit of creditors,
it is Absa’s
case that the applicant has failed to put forward
an adequate factual basis in support thereof and that, in any event,
it has failed
to show that sequestration will be more advantageous to
the body of creditors than conventional execution.
8]
The respondent, except for the terse statement that he “takes
issue” with the applicant’s
statement that the net value
of his estate is R250 000 (which incidentally is inaccurate),
associated himself with the views
expressed by Absa regarding the
potentially deleterious financial consequences that are likely to
result from a forced sale of
the Johannesburg property and
accentuated that the same considerations apply also to the Cape Town
properties of which Standard
Bank is the mortgagee. He also
accentuated the potentially negative consequences the prevailing
depressed economic climate
has had on the property market.
9]
In assessing whether the applicant has discharged the onus that rests
on it, regard must be had to the
fact that the evidentiary burden for
the granting of a provisional order of sequestration is prima facie
proof - i.e. as yet unrefuted
evidence which if accepted, constitutes
proof of the required facta probanda (see:
Kalil
v Decotex (Pty) Ltd and Another
1988(1) SA 943
(A) at 976 G – H) - that there is reason to believe that
sequestration of the respondent’s estate
will be to the
advantage of creditors as a body in the sense of a “not
negligible dividend” (See:
London Estates
(Pty) Ltd v Nair
1957(3) SA 591 (D & CLD)
at 591 G). The concept “reason to believe” in
section 10(c) of the Act
has its genesis in a realization by the
legislature that applicants in applications for provisional
sequestration, other than friendly
ones, are unlikely to have access
to sufficient facts to satisfy a more demanding evidentiary burden
(See:
Amod v Khan
1947(2) SA 432 (N)
at 438;
Hillhouse & Stott; Freban
Investments v Itzkin: Botha v Botha
1990(4) SA 580 (W) at 584 H). Jansen J (as he then was)
in the
London Estates
case (supra) at 592 F – 593
A, elucidated the meaning of that phrase in the following manner:
“
Reason
to believe”, in my opinion, is constituted by facts giving rise
to such belief. Clearly they need not show
“advantage”
on a balance of probability - that would constitute
proof, not belief. When do they give
rise then to such belief?
I respectfully adopt what was said by Roper, J in
Meskin
& Co. v Friedman
1948(2) SA 555 (W) at page 559:
“…
the facts put
before the court must satisfy it that there is a reasonable prospect
- not necessarily a likelihood, but
a prospect which is not too
remote that some pecuniary benefit will result to creditors.”
As all the relevant facts are usually
not known, it would be extremely difficult to work with any more
exacting standard.
Facts indicative of a prospect which
is not too remote, that some pecuniary benefit will result to the
creditors, may include the
fact that a substantial estate exists
(cf:
Hill & Co and Others v Ganie
1925 CPD 242 at page 245). If no substantial estate is
shown to exist, circumstances may yet establish a reasonable
prospect, a prospect that is not too remote, that concealed assets
will be found or others recovered. The mere fact that
sequestration enables investigation of the insolvent’s affairs
is not sufficient: there must be additional facts establishing
that not too remote possibility.”
The meaning
of that phrase was further refined by Leveson J in
Hillhouse
v Stott; Freban Investments v Itzkin;
Botha v Botha
(supra) who at 585 C – D
said that the belief must be rational and reasonable and Cloete J
(as he then was) who
in
Vumba Intertrade CC v
Geometric Intertrade CC
2001(2) SA 1068 (W), in the context
of an opposed application for the providing of security in terms of
section 9
of the
Close Corporations Act 69 of 1984
-
which contains an identical phrase - at 1071 G said that
such a belief must be based on facts giving
rise thereto and that
“… a blind belief, or a belief based on such information
or hearsay evidence as a reasonable
man ought or should not give
credence to, does not suffice.”
Whether that
less demanding evidentiary norm has been satisfied must be decided on
the basis of an overall view of all the facts
in the papers
(See:
Dunlop Tyres (Pty) Ltd v Brewitt
1999(2) SA 580 (W) at 583 F).
10]
Sight must also not be lost of the fact that it is recognised that,
absent any proof of an abuse of the court’s
process, it is
perfectly legitimate for a creditor to institute sequestration
proceedings against a debtor for the purpose of obtaining
payment of
an unpaid debt (See:
Estate Logie v
Priest
1926 AD 312
at 319). Whilst it is common cause
that the applicant has not resorted to conventional execution prior
to instituting the
application, it was preceded by correspondence and
other communications which manifested a genuine endeavour on the part
of the
applicant to procure payment of the judgment debt or part
thereof. As the application was instituted only after such
attempts
had failed there is little room for contending that it was
motivated by considerations other than a genuine desire to bring
about
a concursus creditorum. I am further mindful thereof that
the right to enforce an unfulfilled judgment of a court is an
incident
of the judicial process, access whereto has been guaranteed
by section 34 of the Constitution of 1996 (See:
Chief
Lesapo v North West Agricultural Bank and Another
2000(1) SA 409 CC at paragraph 13).
11]
It appears to be common cause that the respondent owns the following
three immovable properties:
11.1]
Unit 29, Villa La Montagne, Johannesburg which was purchased in July
2006 for an amount of R995 000 and
is mortgaged to ABSA in an amount
of R970 000, leaving an equity of R25 000 on the assumption that it
has not increased in value
and that the outstanding capital on the
mortgage bond has not been reduced;
11.2]
an undivided half share in a property known as Unit 56 Costa Brava,
Cape Town, purchased in January 2007
for R1.3 million and mortgaged
to Standard Bank in an amount of R1.7 million; and
11.3]
an undivided half share in a property known as Unit 57 Costa Brava,
Cape Town, purchased in January 2007
for R1.3 million and mortgaged
to Standard Bank in an amount of R1.7 million.
The
applicant, presumably assuming an increase of R25 000 in the market
value of the Johannesburg property, contended that the respondent’s
equity in the aforesaid three properties would be approximately R50
000, but no explanation is given of how it is arrived at.
12]
The applicant in contending that the respondent’s equity in the
said immovable properties amounts to about
R250 000, alleged that the
respondent owns, either directly or through a corporate entity, a
flat known as Unit 5 Highgrove, 341
Alexandria Road,
Pietermaritzburg, to which - according to a letter addressed by the
respondent to the applicant’s attorney
on 13 December 2007 - a
value of R500 000 was attributed against a mortgage bond registered
in favour of Absa in an amount of R300
000. It appears to be
common cause that the said flat is registered in the name of a close
corporation Pegma 85 Investments
CC (Pegma) in which the
respondent has a 20% member’s interest and that the outstanding
balance on the mortgage bond
in favour of Absa is an amount of R296
000. Absa, contending that the market value of the property is
R375 000, assigned
a theoretical equity of approximately R16 000
thereto, which represents 20% of the difference between R375 000 and
R296 000.
Absa contends that the theoretical equity in the
Johannesburg property is R3 000. That amount is palpably wrong
and should
be R22 000 as it assumed a market value of R995 000 and
averred that the outstanding capital in respect of the mortgage bond
is
R973 000.
13]
The applicant’s assessment of the free residue likely to be
yielded by the immovable properties owned by the
respondent or in
which he has an interest, appears to be unduly optimistic.
Unsurprisingly, as it is based on facile assumptions
devoid of any
supporting factual averments and appears to disregard the corporate
nature of the registered owner of the Pietermaritzburg
property.
To the extent that the first leg of the applicant’s case as
regards advantage to creditors is based on the
existence of a
sufficient free residue likely to be derived from the realization of
the said immovable properties, from which creditors
could receive a
not insubstantial dividend, it has fallen woefully short of placing
facts by means of sworn valuations of their
likely yield in the event
of a forced sale (See:
Nel v Lubbe
1999(3) SA 109 (W) at 111 D;
Ex Parte Anthony en ‘n
Ander en Ses Soortgelyke Aansoeke
2000(4) SA 116 (C) at
paragraphs 14 – 17. There furthermore is an absence of
information as regards the costs
of sequestration as particularised
in, inter alia,
Mamacos v Davids
1976(1) SA
19 (C) at 19 H – 20 B and
Ex Parte Anthony en ‘n Ander
Ses Soortgelyke Aansoeke
(supra) (paragraphs 6 – 10).
14]
As the applicant’s endeavour to place reliance on the existence
of “some equity” in the
immovable properties owned
by the respondent as constituting prima facie proof that there is
reason to belief that the sequestration
of the respondent’s
estate will be to the advantage of creditors has been unsuccessful,
the application can succeed only
if the averment that the respondent
owns as yet undisclosed assets as well as that his true financial
position is likely to be
fully revealed only through an enquiry in
terms of section 152 of the Act, has been shown to have merit.
As was held
in the
London
Estates case
(supra) at 592 H –
593 A, the fact that sequestration enables the holding of an
investigation is not sufficient in
itself. Additional facts
establishing a not too remote possibility that concealed assets will
be found or others recovered
must be shown to exist.
That enquiry
is undoubtedly facilitated by the long established practice in this
Division that where an act of insolvency has been
established, very
strong grounds will have to be adduced to cause a court to even doubt
whether the sequestration will be to the
advantage of creditors
(See:
Wilkins v Pieterse
1937 CPD 165
at 169;
Cohen v Jacobs
1949(4) SA 474
(C) at 481). That practice has been followed in the Eastern
Cape Division (See:
Erasmus v Van Zyl
1959(3) SA 146 (E)) but has not found favour in some of the
other Divisions (See:
Paarl Wine and Brandy Co v
Van As
1955(3) SA 558 (O);
London
Estates
(Pty) Ltd v Nair
(supra). As
Wilkins
v Pieterse
and
Cohen v Jacobs
have - to
the best of my knowledge - not been overruled and, in my view,
are not palpably wrong, I consider them as
reflecting the prevailing
practice in this Division. A further consideration is that
there is ample authority for the proposition
that if - as in the
instant case - there is a substantial estate, and an applicant has
been unable to procure payment in the ordinary
course and is obliged
to bring sequestration proceedings, such a modus operandi would prima
facie be to the advantage of creditors
(See:
Hill and
Co and Others v Ganie
1925 CPD 242
at 245;
Cohen v Mallinick
1957(1) SA 615 (C) at 620
H; and
Puzyna v Puzyna
1962(1) SA 165 (C) at
166 G – H).
15]
The applicant’s attempt to rely on the contents of the letter
addressed by Mr Rahman to Ms Ryan (Annexure
“K”) as
showing that the respondent is possessed of other assets that have
not been revealed, was less than successful.
As correctly
pointed out by the respondent in his belatedly filed answering
affidavit, the said letter constituted inadmissible
hearsay.
The manner in which the respondent dealt with Annexure “K”
in the said affidavit stands in stark contrast
to the manner in which
he dealt with the report by Precision Investigations and Security
Consultants, Annexure “J”.
He did not challenge its
admissibility or reliability - and could hardly have done
so because of its accuracy as regards
the Johannesburg and Cape Town
properties and Pegma - but considered it sufficient not
to challenge the averments in
the founding affidavit seriatim, but
requested that his failure to have done so should not be construed as
an admission of their
correctness and reserved the right to
supplement his affidavit should the need therefor arise. The
contents of paragraph
13 of the respondent’s answering
affidavit sheds light on his failure to have disavowed the
correctness as well as the existence
of his interests in the
corporate entities enumerated in Annexure “J”:
“
In
conclusion I wish to state that I am a businessman and entrepreneur,
I do not practice a profession. Were this Honourable
Court to
grant an Order sequestrating my estate I would suffer irreparable
harm and would, I am further advised, be precluded from
trading
freely, in particular, would be precluded from holding Company
directorships. This would, in my submission, severely
hamper my
abilities to earn a living, to trade freely and to trade out of my
financial difficulties and to repay my creditors.”
Whether
annexure “J” correctly reflects the corporate entities in
which the respondent appears to have interests is
peculiarly within
his personal knowledge and his failure to have dealt therewith
warrants that the inference least favourable to
his cause be drawn
namely, that its correctness could not be disputed (Cf:
Galante v Dickenson
1950(2) SA 460 (AD) at
465). That the respondent’s shares / interests in the
said corporate entities form part
of his estate if he were to be
sequestrated is self-evident.
16]
The respondent’s desire to be allowed “to trade
freely and to trade out of my financial difficulties
and to repay my
creditors” is susceptible of only one inference namely, that he
is carrying on business by means of corporate
entities and/or other
business vehicles. That he must be in receipt of a substantial
monthly cash flow is apparent from the
amounts of the mortgage bonds
that he has to service periodically. It is highly unlikely that
either Absa or Standard Bank
as holders of the mortgage bonds of the
Johannesburg and Cape Town properties would have granted them unless
the respondent had
satisfied them as regards his ability to
service them. The monthly repayments on mortgage bonds
amounting to almost R2.7
million come to a substantial amount.
A further indication of the respondent’s access to cash - apart
from his share
of the bond over the Pietermaritzburg property - is
his preparedness in correspondence with the applicant’s
attorney to have
paid an amount of R250 000 in monthly instalments of
R12 500. The sources which generate cash-flows of such
magnitude and
the possibility of realizing them are matters that call
for investigation in a hearing in terms of section 152 of the Act.
So does the averment in annexure “F” - a
letter written by the respondent to the applicant’s attorney
on
19 December 2007 - that “… my cash assets and
liabilities are roughly the same.”
Assuming
that the amounts owing by the respondent on the mortgage bonds passed
over the Johannesburg and Cape Town properties are
roughly equal to
the market values thereof and bearing in mind that the respondent
owes the applicant in excess of R1.1 million,
it follows logically
that the respondent must be in possession of substantial other
assets, the nature and whereabouts of which
have not been divulged.
17]
A further aspect that appears to lend itself to further investigation
at an enquiry in terms of section 152 of the
Act is the true extent
of the respondent’s interests in Pegma. The need to do so
arises from the fact that the respondent
in correspondence with the
applicant’s attorneys offered the flat registered in that
entity’s name as security for
the payment by him of an amount
of R250 000 on the judgment debt whilst he was marketing it and from
the proceeds to “fast
track” payment thereof.
That the respondent could market the Pietermaritzburg flat and
utilise its proceeds towards
the payment of a personal obligation
belies the correctness of the assumption that he holds only a 20%
interest in Pegma.
18]
Despite the fact that the unfulfilled judgment debt is for
obligations that were incurred prior to March 2006, the
respondent
resists the granting of a sequestration order on the basis that it
would enable him “to trade out of my
financial
difficulties and to repay my creditors”. That approach
disregards that in considering any advantage to creditors,
sight must
not be lost of the fact that creditors have a right to obtain payment
as soon as possible, failing which, they may resort
to what has been
described as the ultimate form of execution namely sequestration
(See:
Wilkins v Pieterse
(supra) at
170). The respondent requires the applicant to pursue
time-consuming and laborious conventional execution
procedures in
respect of a number of different movable and immovable assets
situated in different parts of South Africa or to make
use of the
notoriously deficient procedure of interrogation provided for by
section 65 of the Magistrates’ Court Act, No
32 of 1944 whilst
he is subjecting such assets as he at present possesses to the
commercial risks involved in trading in the hope
of being able to pay
his creditors at some undetermined juncture in the future. In
my view, the present is a case, par excellence,
to give recognition
to the “superior legal machinery which creditors acquire
by sequestration” and was articulated
as follows by Horwitz J
in
Chenille Industries v Vorster
1953(2) SA 691 (O) at 699 F – G:
“…
the right to
control the collection, custody and disposal of all the assets
through their nominee, the trustee, the right to control
similarly
the sale of the assets, the certainty that the insolvent cannot
contract further debts and diminish the estate, and the
assurance
that all creditors will be accorded the treatment prescribed by law
in the division of the proceeds.”
19]
Of the respondent’s creditors only Absa has opposed the
application. It has succeeded in making out
a convincing case
that the applicant has failed to show that the sequestration of the
respondent’s estate would be to
its
advantage as a
secured and possibly, a concurrent creditor. The question
whether there is reason to believe that sequestration
will be to the
advantage of creditors may not be assessed with reference to the
situation of a particular creditor but with reference
to its effect
on the general body of creditors (See;
Peycke v
Nathoo
(1929) 50 NLR 178
at 185;
Stainer v
Estate Bukes
1933 OPD 86
at 89;
London Estates
(Pty) Ltd v Nair
(supra) at 591 G). Taking
a holistic view the question whether the sequestration of
the respondent’s
estate will be to the advantage of his
creditors as a body, I incline to the view that facts have been shown
to be present which
are sufficient to engender a rational and
reasonable belief that, prima facie, the sequestration of the
respondent’s estate
will be to the advantage of his creditors.
20]
As the only issue in dispute as between the parties has been decided
in the applicant’s favour it follows
that it is entitled to an
order in the terms as prayed for in the notice of motion.
Accordingly an order is granted in terms
of annexure “A”
hereto.
21]
In terms of the order made by this court on 16 April 2008 by
agreement between the parties the costs of Absa’s
application
for intervention was ordered to stand over for later determination.
The effect of the order sequestrating the
respondent’s estate
is that Absa has been unsuccessful in opposing the relief sought by
the applicant. I have given
consideration to the question
whether the rule nisi should not make provision for an order calling
upon interested parties to show
cause why Absa’s costs of
intervention and opposition should not be included the costs of
sequestration. The views
of courts thereanent are divergent.
Some require the existence of special circumstances and others that
the opposition should
have been bona fide and reasonable. I
prefer the approach followed in this division in
Calderco
(Pty) Ltd v Elliot
1940 CPD 248
namely that each
application should be considered on its own merits free from any a
priori approach. As I have come to the
conclusion that although
Absa’s intervention and its opposing of the granting of the
sequestration order was predominantly
actuated by its own interests
as a creditor and not those of the general body of creditors, I
nevertheless incline to the view
that the information placed by it
before this court has significantly contributed towards a proper
adjudication of this application
and for that reason consider it
appropriate to modify the proposed rule nisi as regards the costs of
sequestration to read as follows:
“
2.2
The costs of this application including the costs of intervention and
opposition by the intervening
creditor should not be considered to
form part of the costs incurred in connection with the application
for the sequestration of
the respondent’s estate.
22]
As in my view the respondent’s opposing of the granting of a
provisional order of sequestration was neither
reasonable and/or bona
fide and in any event, devoid of any special circumstances no order
is made as regards the costs thereof.
23]
In accordance with a long-standing practice in this division the
relief which has been granted herein is a rule
nisi operating as a
provisional sequestration order pending the adjudication of the
sequestration application on the return day
in terms of a more
demanding evidentiary norm than the prima facie proof applicable at
this juncture namely, a balance of probabilities
(See:
Paarwater v South Sahara Investments (Pty) Ltd
[2005] 4 All SA 185
(SCA) at 186 h). Accordingly, the
question of the desirability of the handing down of a fully motivated
judgment arose.
As no guidance could be gleaned from decided
cases and text book writers thereanent, I have had occasion to seek
guidance from
experienced present and past colleagues. The
consensus of opinion appears to be that this Division’s
practice of not
handing down a fully motivated judgment when a
provisional order of sequestration is granted, is a salutary one.
Torn between
that practice and my instinctive sense of fairness
- which incidentally appears to be consistent with the view of the
Supreme
Court of Appeal (See:
Road Accident Fund v
Marunga
2003(5) SA 164 at paragraphs 31 and 32) -
that where the issues have been fully argued in an opposed matter,
litigants are entitled to be informed of the reasons for the
conclusion arrived at, I, have chosen to steer the middle course of
providing reasons but of a less encompassing nature that I would
otherwise have done. That approach also enabled me to do
a
measure of justice to counsels’ detailed and helpful
submissions.
24]
There is one remaining aspect that needs to be considered namely,
liability for the costs of an opposed application
brought by the
applicant to compel Absa to comply with a notice in terms of Rule
35(12) delivered on 18 April 2008. That
issue has arisen
because Absa’s attorneys complied with the said notice only
when delivering and filing its answering affidavit
on 29 May 2008.
The application to comply was preceded by unnecessarily vitriolic
correspondence between the attorneys representing
the applicant and
Absa. Absa’s attorney consistently adopted the stance
that there was no need to comply with the Rule
34(12) notice.
The refusal to do so was based on three broad grounds. The
first is that Rule 35(12) has no application
in the absence of a
direction of the Court as envisaged in Rule 35(13); the second
is that the document of which copies were
sought had been referred to
in the applicant’s founding affidavit; and the third was
that the applicant could have
obtained an electronic copy thereof
through the “Windeed” system. The practice in
this division is that
if a document is referred to in a pleading or
application the party who does so is obliged to produce it for
inspection unless
it is not in his/her/its possession or cannot be
produced or is privileged or irrelevant. In that case the
recipient of the
notice bears the onus to set out the facts relieving
him/her/it of the obligation to comply (See:
Gorfinkel
v Gross, Hendler & Frank
1987(3) SA 766 (C)).
There appears to be ample authority for the proposition that the
effect of the unambiguous language
of Rule 35(13) is that the
applicability of the discovery provisions of Rule 35 to
applications is dependent on a direction
by the court that it finds
application in a particular matter (See:
Loretz
v MacKenzie
1999(2) SA 72 (T) at 74 G;
Afrisun
Mpumalanga (Pty) Ltd v Kunene N.O. and Others
1999(2) SA 599 (T) at 611 G – H). Although Absa’s
attorneys’ approach, at first blush, may appear
to be smacking
of undue pedanticism it is supported by, in my view, unassailable
authority. As that stance had been conveyed
to the applicant’s
attorneys beforehand, the application was launched with full
awareness of the basis on which compliance
was being resisted.
In the circumstances I incline to the view that the applicant should
be ordered to pay the costs of the
Rule 35(12) application on a party
and party basis.
______________
D. VAN
REENEN
ANNEXURE
“A”
ORDER:
1]
The estate of the respondent is sequestrated and placed in the hands
of the Master of this Court.
2]
A rule nisi is issued calling upon the respondent to show cause on 29
October 2008 at 10h00 or as soon
thereafter as counsel can be heard
to why:
2.1
a final order of sequestration should not be granted;
2.2
The costs of this application including the costs of intervention and
opposition by the intervening creditor should
not be considered to
form part of the costs incurred in connection with the application
for the sequestration of the respondent’s
estate.
3]
Service of the order must be effected by the Sheriff:
3.1
on the respondent personally at Flat 201, Costa Brava, Beach Road,
Sea Point, Western Cape;
3.2
any registered union which may be found to represent any of the
respondent’s employees;
3.3
on the employees themselves at the respondent’s last known
address;
3.4
the offices of the South African Revenue Service (SARS) at 22 Hans
Strijdom Avenue, Cape Town.