Mittal Steel South Africa limited t/a Vereeniging Steel v Pipechem CC (7072/07) [2007] ZAWCHC 55; 2008 (1) SA 640 (C) ; (16 October 2007)

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[2007] ZAWCHC 55
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Mittal Steel South Africa limited t/a Vereeniging Steel v Pipechem CC (7072/07) [2007] ZAWCHC 55; 2008 (1) SA 640 (C) ; (16 October 2007)

REPORTABLE
IN THE HIGH COURT OF
SOUTH AFRICA
(CAPE OF GOOD HOPE
PROVINCIAL DIVISION)
CASE NO:
7072/07
In the matter between:
MITTAL STEEL SOUTH
AFRICA LIMITED T/A
VEREENIGING
STEEL
Applicant/Plaintiff
and
PIPECHEM CC
Respondent/Defendant
JUDGMENT DELIVERED ON 16 OCTOBER
2007
DONEN AJ
The applicant, a registered company,
has applied to set aside respondent’s notice of intention to
defend an action as an irregular
step: and thereafter, for default
judgment to be entered against respondent. For convenience I shall
refer to the parties as plaintiff
and defendant.
The defendant is a close corporation
(“the corporation”) incorporated in terms of the provisions of
the
Close Corporations Act 69 of 1984
. Defendant has two members.
The managing member is Firolama Alfredo Crabbia (“Crabbia”). He
holds an eighty per cent member’s
interest in the corporation.
His wife, Marinella Crabbia, holds the remaining twenty per cent.
On 31 May 2007 the
plaintiff instituted action against defendant for payment of the sum
of R194 639,87, together with interest
and costs of suit.
Plaintiff’s cause of action allegedly arose from the sale and
delivery to defendant of two consignments of
steel bars during
November 2005.
On 7 June 2007 defendant filed and
served the disputed notice of intention to defend. This had been
signed by Crabbia in his capacity
as managing member. In the body
of this document it was stated that the defence would be “
conducted
by Mr G A Crabbia, Managing Member
”.
The address given in the
document differed from the business address of the defendant alleged
in the summons. Both addresses are
located in Somerset West; that
is, more than eight kilometres from the office of the registrar. No
address for the service of
documents in the action was appointed
within the eight kilometre radius.
On 21 June 2007 plaintiff’s
attorneys responded by causing a written notice to be served on the
defendant pursuant to the provisions
of Uniform
Rule 30(2)(b).
It
was alleged in this notice that the document that had been delivered
at the offices of the plaintiff’s attorneys, on 7 June
2007 had
not complied with the requirements of Uniform
Rule 19
for delivering
a notice of intention to defend. The following reasons were stated:
“
1) The defendant,
being a juristic person, did not act through an attorney in
delivering the notice of intention to defend, as it
is required to do
in terms of Uniform
Rule 19(1)
; and
0
in; margin-top: 0in; margin-bottom: 0in; line-height: 200%">
2) The defendant did
not appoint an address within eight kilometres of the office of
registrar of the honourable Court for the service
on him of
documents, as required in Uniform
Rule 19(3).”
Defendant was afforded ten days (i.e.
until 5 July 2007), to remove the cause of complaint.
The relevant part of
Uniform
Rule 19(1)
, for present purposes, provides as follows:
“
19)
NOTICE
OF INTENTION TO DEFEND
Subject to the provisions
of
s27
of the Act, the defendant in every civil action shall
be allowed 10 days after service of summons on him within
which
to deliver a notice of intention to defend, either
personally or through his attorney: …
.”
The word
“deliver”
is defined in
Rule 1
as
meaning,
“serve copies on
all parties and file the original with the registrar”
.
As authority for the relief that it
claims plaintiff relies on
Arma
Carpet House (Johannesburg) (Pty) Ltd v Domestic and Commercial
Carpet Fittings (Pty) Ltd and Another
.
1
In that case a natural person and co-defendant who had bound
himself as surety for payment of the debts of a South African
registered
company had signed a notice of intention to defend the
action. It was held that the company could validly only give notice
of
intention to defend through an attorney. The notice was
accordingly bad in law and was set aside. Judgment by default was
then
granted against the company. Neither the application in terms
of
Rule 30
(to set aside the notice), nor the application for
default judgment was opposed.
With reference to
Rule 19(1)
Margo J
held that the right to act in person cannot extend to an artificial
person. Had the rule been intended to permit any person
to
represent a defendant in giving notice of intention to defend it
would not have been necessary to refer to “
the
defendant personally or through an attorney
”.
The rule would then have referred to the “
defendant
or his agent
”.
2
The decisive factor in previous
decisions
3
(viz. the rights of audience of advocates in the Supreme Court and
in the signing of pleadings respectively), did not arise in
the
issue of a notice of intention to defend. However, the principle
appeared to Margo J to be the same: namely, that a litigant
who did
not appear in person had to be represented by an advocate, and in
exceptional circumstances by an attorney
4
;
but a company, being an artificial person was, not entitled to
appear in person. At the time of the judgment pleadings had to
be
signed by an advocate and an attorney,
5
or by a litigant in person: but on the decided authorities a
corporation, being an artificial person, could not sign “
in
person
”.
6
Margo J concluded that in referring
to the defendant personally or his attorney the rule did not
prescribe who had to make delivery,
but rather to a notification of
the person through whom the defence would be conducted. From this
it follows that, should leave
be granted to Crabbia to conduct the
defence of the defendant, the object of the notice would be
achieved. Since the approval
by the Supreme Court of Appeal, in
Navy Two CC v Industrial
Zone Ltd;
7
of the landmark decision in
California
Spice and Marinade (Pty) Ltd & Others in re: Bankorp v
California Spice & Marinade (Pty) Ltd and 5 Others; Fair
O’Rama
Property Investments CC and Others; Tsaperas; & Tsapera
8
,
South Africa’s High Courts have, in exceptional circumstances,
countenanced the representation of juristic persons by persons
other
than advocates. These circumstances are dealt with below.
Because the application in the
Arma
Carpet
case was unopposed
little consideration was given to the contradiction involved in
denying access to ventilate a dispute to a corporate
defendant on
whose behalf notice of intention to defend had been given (albeit
defectively). The learned judge concluded that
because it had been
open to the defendant to apply for a postponement to enable proper
notice to be delivered, and because the
applications had not been
opposed, default judgment was appropriate.
9
At the time of that
judgment courts were not
bound, as they presently are, to interpret and apply the
constellation of rules relating to notice of intention
to defend,
pleading and default judgment in a manner which promoted the spirit,
purport and object of a defendant’s right to
have a dispute
decided in a fair hearing before a court.
10
This right is vested by
section 34 of the Constitution which provides as follows:
“
ACCESS
TO COURTS – Everyone has the right to have any dispute that can be
resolved by the application of law decided in a fair public
hearing
before a court or, where appropriate another independent and
impartial tribunal or forum”
Section 8(4) of the Constitution
provides “
that juristic
persons are entitled to the rights in the Bill of Rights to the
extent required by the nature of rights and the nature
of that
juristic person
.”
Juristic persons are therefore entitled to the protection of Section
34 of the Constitution.
Furthermore, at the time of the
judgment in the
Arma Carpet
case, Rule 31 confined the power to grant a default judgment to the
Supreme Court, whenever a plaintiff’s claim was for a debt
or
liquidated demand and a defendant was in default of delivery of a
notice of intention to defend.
11
Since then this power has also been vested in the Registrar by Rule
31(5)
12
.
Consequently the setting aside of a notice of intention to defend
by the High Court, in terms of Rule 30, exposes a corporation
intending to defend an action to a potential denial of access to
court by virtue of the registrar’s separate power to grant default
judgment.
Rule 31 was amended to alleviate the
burden of default judgments on judges of the High Court
13
.
It has been held that the peremptory language of Rule 31(5)(a)
limits a plaintiff claiming default judgment in respect of a debt
or
liquidated demand, in the first instance, to seeking relief from the
registrar
14
.
When evidence is required to prove the amount of the claim or the
cause of action or where the registrar has a legitimate doubt
as to
whether judgment should be granted or not, the registrar is bound to
refer the matter for hearing in open court in terms
of the subrule
15
.
The registrar does not exercise a judicial function, but simply
makes a formal evaluation of whether the summons discloses a
proper
cause of action: that is, after establishing that all the
administrative and formal steps have been taken to justify a

judgment
16
.
Whenever a plaintiff seeks a default
judgment arising from a notice of intention to defend a corporation
that is irregular, in that
it has been signed by a member of the
corporation, the matter should be set down for hearing in open court
in order to determine
whether or not the corporation may be granted
leave to defend the action.
If so, the application for default
judgment would fall away. If not (and in any event), the High Court
retains jurisdiction to
dispose of the default judgment in the
interests of justice
17
.
The power to determine the regularity of a notice of intention to
defend is retained exclusively by the High Court.
18
How a court exercises this power with reference to default judgment
claimed against a corporation will depend on all the facts:
inter
alia
, the possibility of
default judgment being granted as a result.
I now proceed to deal with the facts
in the present application. In the founding affidavit, plaintiff’s
attorney, Johan Hendrik
Botes (“Botes”), alleges that defendant
does not have a
bona fide
defence, that the document purporting to be a notice of intention to
defend was delivered simply in order to delay the plaintiff’s
action, and that the matter may also be disposed of through the
operation of Rule 32 relating to summary judgment.
Botes states further that, on 22 June
2007, and in response to plaintiff’s notice of an irregular step,
a second document was
delivered to the offices of plaintiff’s
attorneys. (This was dated 21 June 2007.) It had been signed by
Crabbia who made the
following statements therein:
“
1) In
terms of Uniform Rule 19(1) The defendant may be represented by a
attorney or a person. G A Crabbia is a person who is also
managing
member of Pipechem CC.
2) The
following address is the defendants appointed address.
Roligh Grinrod Care off Pipechem
CC represented by G A Crabbia on The 4
th
Floor, Four Trust Building, Martin Hammerschlag Way Foreshore Cape
Town.”
(The last-mentioned address does fall
within 8 kilometres of the office of the Registrar.)
As a courtesy, on 25 June 2007,
plaintiff’s attorneys wrote to Crabbia. They quoted Uniform Rule
19(1), provided an excerpt from
Erasmus’ Commentary on Uniform
Rules (entitled “Superior Court Practice”), and explained the
effect of Uniform Rule 19(1)
as follows:
“
In the instant matter the
defendant is Pipechem CC, which is a separate legal entity or
“juristic person”. However, the legal
personality of Pipechem CC
is a fiction, i.e. it is not a real person, and for that reason it
cannot act “personally”, but always
acts through its members
and/or its agents.
4) Uniform Rule 19(1)
states that a defendant can only deliver the notice of intention to
defend personally or through an attorney.
Since Pipechem CC cannot
deliver the notice “personally”, the only other manner provided
for by Uniform Rule 19(1) is to deliver
the notice through an
attorney. The Rule does not provide for delivery of the notice
through a member or an agent.”
In the light of this approach to the
interpretation and application of the rule quoted above defendant was
informed that, should it
“
fail
to give notice of its intention to defend through an attorney as
requested in the notice served on it on 21 June 2007
,”
plaintiff would proceed with an application in terms of Rule 30 and
defendant would run the risk that the Court might, upon plaintiff’s
application, enter default judgment against defendant.
The content of this letter highlights
the limitation that Rule 19(1) places upon the capacity of a close
corporation to protect
its interests. By virtue of the provisions
of the
Close Corporations Act a
member of a corporation is its agent
in relation to a person who is not a member and is dealing with the
corporation
19
.
As between defendant and plaintiff this authority would include the
power of Crabbia to conclude both the sales agreement giving
rise to
the dispute and any settlement agreement resolving the dispute
20
.
Save for the traditional interpretation of
Rule 19(1)
, as expressed
in the
Arma Carpet
case,
no reason exists in principle why a corporation should have to enter
a separate contract with an attorney (and create a relationship
with
some features peculiar to the law of agency)
21
in order to note its intended opposition to an action. The
differential treatment meted out to natural and juristic persons by
this rule leads to unequal protection and benefit of the law.
The relevant policy considerations
giving rise to the differential treatment are more pertinent to the
conduct of trials than the
delivery of notice of opposition. They
include the following: -
The courts are best served by legal
practitioners who observe the rules of their profession, who are
subject to a disciplinary
code, and who are familiar with the
methods and scope of advocacy which are followed in presenting
argument.
22
Qualified practitioners can assist
the court by advancing meaningful arguments, founded on legal
principles and up-to-date authority,
23
and the absence of such a qualified practitioner will cause a court
inconvenience and difficulty.
24
A person who has not achieved a
certain minimum standard of education and experience in the art of
advocacy is most unlikely to
be able to: (i) adopt an approach and
attitude which is not exclusively subjective; (ii) discuss the
matter with the representative
of the other side with a view to
limiting the issues and compromising where possible; and (iii)
dealing frankly and candidly
with the Court.
25
Litigants in person are not usually
the most effective advocate for themselves – from lack partly of
knowledge of the law, partly
at time of perspective.
26
It is possible that they will do more harm than good to the
companies they assist.
27
The rule that a juristic person has
to be represented in the High Court by a duly certified attorney had
its origins in the English
common law. It was not rendered
applicable to South African High Courts by any statute.
28
In South Africa the rule is not inflexible. A court is entitled in
an appropriate case and to avoid injustice to allow at least
a one
person company to be represented at a court hearing by its alter
ego. The test to be applied involves weighing up of the
inconvenience caused to the court as a result of an unqualified
person appearing before it against the injustice of a juristic
person being denied access to the courts.
29
The Courts have stated that the
discretion to depart from a rule of this kind should only be
exercised “
sparingly
”,
“
where there are
exceptional features”,
in “
uitsonderlik gevalle
”
and “
as a reserve or
occasional expedient
”
30
The obtaining of a default judgment
against a defendant corporation simply because its alter ego-rather
than an attorney-delivers
a notice of intention to defend is
tantamount to a denial of the right of access to court. Such a
severe limitation upon the constitutional
right of a corporation
could hardly ever be justified in relation to the convenience of the
court and the other policy considerations
referred to above. The
ultimate relief sought by the plaintiff on the facts of the present
application would amount to the unfair
resolution of the dispute
between the parties
31
.
It would arise from an unfair differentiation that
Rule 19(1)
makes between a natural person and a close corporation in relation
to the serving and filing of a notice.
In applying the principles above to
this matter certain other developments also become relevant. On 25
June 2007, in response to
the threat of the present applications,
Crabbia directed a letter to plaintiff’s attorneys in which he
gave notice that he intended
to seek the opinion of this court in
regard to defendant’s rights.
Inter alia
,
he stated the following:
32
“
1) ..
it is stated that defence will be conducted by Mr G A Crabbia the
managing member Of Pipechem CC.80 %.
2) We
do comply to the requirements of the act. Mr Dreyer the Sheriff is
of the same Opinion.
33
4) We wish to give
notice should Shepstone and Wiley not accept Mr G A Crabbia as the
defendant’s representative. We will take
the matter to the
Honourable court at the High court Keerom street Cape Town for there
Opinion.
5) As stated on you point 3
Pipechem can only act through its members and in this instance is
acting through G A Crabbia. As per
the Rule the defendant is only
able to act through its members. Therefore it may be represented by
its members or attorney.”
On 29 June 2007 Crabbia delivered a
further notice.
Inter
alia
, he stated the
following in relation to the alleged irregular steps:
“
We ask the Honourabel court for
a concessesion if possible for Mr G Crabbia to represent Pipechem CC
1)
Rule 19
G A Crabbia
is not a Agent but Pipechem CC … A agent acts on behave of and is
not part of …. Crabbia is 80 % of Pipechem CC
and is part of
Pipechem and not a Agent.
2) G A Crabbia signed
a personal guarantee as 80% owner.
If the above is not
acceptable to the Honourabel court the plaintiff whishes to ask for
a state attorney who will not be rewarded
financially for using his
or her privileged position and knowledge.”
In the introduction to
this notice Crabbia alleged the following:
“
4) Private Law dose
not have justice as its main objective and is financially driven.
And they have the privileged advantage of using
their know-how and
client’s money or lack of money to influence the case between
themselves.
5) G
A Crabbia also a member of Pipeforge CC have only had one other case
case no 2092/97. The Supreme Court Nigel Dastek/Pipeforge
was
represented by attorneys.”
On 29 June 2007, a further document,
signed by Crabbia, and purporting to be a declaration was delivered
to plaintiff’s attorneys.
An answer to the merits of plaintiff’s
claim appears to be raised therein, albeit cryptically.
On 12 July 2007 plaintiff launched
the threatened application in terms of
Rule 30
and alleged that the
defendant, being a juristic person, had failed to give notice of its
intention to defend through an attorney
as it is required to do by
reason of Uniform
Rule 19(1).
In his supporting affidavit Botes
alleged that the plaintiff was suffering prejudice. It was unable
to take any further steps until
the defendant had either delivered a
notice of intention to defend in compliance with
Rule 19
or the
court had been persuaded by the defendant that Crabbia was entitled
to represent the defendant; and the documents signed
and delivered
to plaintiff’s attorney on 7 June 2007 (or some other document),
could stand as a notice of intention to defend.
Plaintiff expressed
its desire to bring an application for summary judgment as an
alternative to default judgment. The defective
notice was
“
accordingly a hinderance
to the further conduct of the matter
”.
It was contended further by Botes
that, if Crabbia were allowed to represent the defendant, plaintiff
would be substantially prejudiced
in that defendant’s case would
be presented by an unqualified person, the defence would be
disorganised and unsystematic and
would result in undue delays and
legal costs because of Crabbia’s lack of expertise. He could
require indulgences from the court
and from the plaintiff. Should
the defendant turn out to be impecunious (the facts of which
plaintiff had no knowledge), then
the possibility existed that
Crabbia would cause the defendant to litigate hopeless causes
without fear of personal liability,
and the plaintiff would be
unable to recover its costs. It was also contended that Crabbia
could have difficulty in obtaining
authority to make decisions
during the course of the proceedings. However, plaintiff is
unlikely to suffer prejudice of this kind
should it be successful in
the proposed application for summary judgment.
Finally, it was
contended by Botes that the defendant had not brought a proper
application requesting the court to permit Crabbia
to act for the
defendant. The court had no evidence in terms of which it could
exercise its discretion.
In conclusion the plaintiff prayed
for an order setting aside the purported notice of intention to
defend as an irregular step and
sought judgment by default in terms
of the draft order that had been attached to the notice of
application.
On 17 July 2007 defendant delivered a
notice of opposition to the relief claimed by the plaintiff. To
this was attached a comprehensive
affidavit deposed to by Crabbia,
who had also signed the notice on behalf of the defendant.
Inter
alia
, he repeated certain
allegations to the effect that defendant has a defence to
plaintiff’s claim and that the situation is “
a
repeat”
of a previous
case between the parties. Due to his past experience of the dispute
and events leading to the present application
Crabbia believed that
it would be in the best interests of defendant for him to defend the
action as he was involved in the matter
from its inception. He was
supported in this conclusion by the content of an annexed letter
emanating from Marinella Crabbia.
She also confirmed that she held
a twenty per cent member’s interest in the defendant.
The matter was fully argued before me
by counsel for the plaintiff, Mr Cooke, who also provided the court
with comprehensive and
helpful written argument. No objection was
raised to the appearance before me of Crabbia who argued on behalf
of the defendant.
Plaintiff persisted in seeking a default
judgment. In its written argument plaintiff gave notice that,
should the court find
that the notice was not defective, the
plaintiff would apply in terms of the
Rule 27(1)
, for an extension
of time within which to file a summary judgment application.
.
By virtue of the
several opportunities that the plaintiff had afforded defendant to
reconsider its position counsel argued that
the defendant and/or
Crabbia should be ordered to pay the costs incurred by the present
application.
To accommodate any further conduct of
these proceedings I shall not deal with the alleged defences and
other technical points raised
by Crabbia in the documentation and
oral argument, although these were argued before me.
In all of the circumstances above it
is apparent that the plaintiff seeks to avoid a trial of the action
- whether by default judgment
or summary judgment - depending on how
the court responds to the application in terms of
Rule 30.
Plaintiff as a litigant enjoys a right to make the fullest use of
the Uniform Rules. Both parties are vested with the constitutional
right to have the dispute decided in a fair public hearing
34
.
The defendant’s right of access binds the judiciary when the High
Court exercises its inherent power to regulate its own process
in
the exercise of the court’s power to grant default judgment
35
.
This right informs the coherent interpretation and application of
Rules 30, 31(5) and Rule 32 in their entire context.
The Uniform Rules are silent as to
their cumulative effect in the present circumstances: that is where
defendant (after delivering
an irregular notice of intention to
defend), has failed to make formal application to be represented by
Crabbia in the action and
plaintiff seeks a default judgment without
reference to the Registrar, or alternatively seeks to apply for
summary judgment in
the future. The court is therefore constrained
to exercise its inherent power to regulate its own process taking
into account
the interests of justice
36
.
Counsel’s argument on behalf of
plaintiff has failed to accommodate the right of the defendant, in
terms of section 34 of the
Constitution, to have a dispute that can
be resolved by the application of law decided in a fair public
hearing before an impartial
court. Counsel did not address four
allegations contained in the “
purported
notice of intention to defend
”,
which conclude with the statement; “
The
plaintiff did not act in a manner that may have resolved this
claim
”. These
statements suggest the nature of the defence that defendant proposes
to raise.
For purposes of argument it was
conceded by Counsel that Crabbia is effectively the alter ego of the
defendant. It was further
conceded that the defendant “
had
a negative experience
”
when it relied on a firm of attorneys in Nigel to represent the
defendant in a previous matter.
During argument Crabbia acknowledged
his awareness of one possible consequence of his conduct in defence
of the defendant viz. that
he might be held personally liable for
the plaintiff’s legal costs, when the court eventually exercises
its discretion in the
proceedings.
37
From the documentation it appears
that the written English language is not Crabbia’s strongest suit.
However, it also appears
that he reached the second year of an
engineering degree at the University of the Witwatersrand. He
employs forty-three people
in the defendant’s business. From the
letterhead of the defendant it appears to operate its business at
three geographically
dispersed branches located at Somerset West,
Durban and Nigel.
In presenting the defence on behalf
of the defendant Crabbia would be subject to the discipline of the
court presiding over the
proceedings as well as the acknowledged
financial consequences of his own dilatoriness or any egregiously
unethical behaviour.
By virtue of his role in the defendant there
should be no difficulty in Crabbia obtaining further authority to
make decisions
during the course of the proceedings.
In my view an injustice would arise
should a default judgment flow from the failure of the defendant to
deliver a “
regular
”
notice of intention to defend, in accordance with the principles set
out in the
Arma Carpet
case.
As already stated, the interpretation
and application of Rule 19(1) in a manner that prohibits a close
corporation from validly
delivering a notice of intention to defend
through its
alter ego (
by
requiring such notice to be given through an attorney), limits the
corporation’s right of access protected by Section 34 by
placing
an obstacle in the way of such access
38
.
To permit default judgment solely because notice has not been given
by an attorney amounts to a denial of access.
For purposes of exercising my
discretion my foremost consideration is that the plaintiff is
seeking to deny the defendant access
to this court unless it acts
through an attorney, despite the fact that the defendant has
notified the plaintiff and the court
that it intends to defend and
that it has a defence. Such a defence ought not to be suppressed
even before the summary judgment
stage of proceedings has been
reached. The prejudice to the defendant which would be caused by a
default judgment at this stage
remains incalculable. The interest
of the plaintiff in the litigation, as well as the public interest
in the expedition of the
conclusion of any trial that may follow an
unsuccessful summary judgment application and the inconvenience to
the court that has
been suggested by plaintiff cannot reasonably and
justifiably limit the defendant’s right of access.
In all the circumstances
I make the following order: -
1) Subject to the condition in
paragraph 2 below, and for so long as he holds an 80% members
interest and continues to be the managing
member of the defendant, Mr
G A Crabbia is granted permission to represent the defendant in legal
proceedings instituted by Mittal
Steel SA Ltd (plaintiff) against
Pipechem CC (defendant), under case number 7072/07;
2) The defendant shall, within ten
court days of this order, file with the Registrar and serve on the
plaintiff’s attorneys a resolution,
signed by all the registered
members of the defendant, authorising Mr G A Crabbia to represent the
defendant in the legal proceedings
described above and to take
whatever steps and decisions may be necessary for defendant to defend
the action until final judgment
is granted by this court;
Should defendant fail to file the
resolution referred to in paragraph 2 above timeously or at all,
plaintiff is authorised to apply
to this court for default judgment,
upon forty eight hours notice to defendant, care of Roligh Grinrod,
4
th
Floor, 4 Trust Building, Martin Hammerschlag Way, Foreshore, Cape
Town, on the papers filed to date (duly supplemented where
necessary),
together with costs;
For purposes of further proceedings
in this matter, including any application for summary judgment, the
date on which the aforementioned
resolution is delivered shall be
deemed to be the date upon which delivery of defendant’s notice of
intention to defend was effected;
The application for
default judgment is refused;
In the event of the defendant filing
the resolution as aforesaid the costs incurred by the present
applications will become costs
in the cause, failing which the
defendant is ordered to pay such costs.
__________________
DONEN
AJ
1
1977
(3) 448 (W)
2
Arma
Carpet House
case
supra
at
451. See too the Interpretation of Uniform Rule 19(1) in
Volkskas
Motor Bank Ltd v Leo Mining Raise Bone CC and Others
1992 (2) SA 50
(WLD)
3
See,
inter
alia
,
Yates
Investments (Pty) Ltd v Commissioner for Inland Revenue
1956 (1) SA 364
(AD);
Dormehl’s
Garage (Pty) Ltd v Magagula
1964 (1) SA 203
(T);
SA
Cultivators (Pty) Ltd
v
Flange Engineering Co (Pty) Ltd
1962 (3) SA 156
(T): see too
Hallowes v The Yacht “Sweet Waters”
1995
(2) SA 270
(D & CLD)
4
Cf
section 4 of The Right of Appearances in Courts Act, 62 of 1995
5
Cf
Fortune v Fortune
[
1996]
2 All SA 128
(C) and the amended High Court Rules 18(1) and 21(3)
6
Arma Carpet
case
supra at 450F to 451 A
7
[2006]
3 All SA 263
(SCA) at 266
8
[1997]
4 All SA 317
(W)
9
Arma
Carpet
case
at 451 C-E
10
See
sections 39(2) and 34 of the Constitution
11
Prior
to 21 January 1994, Rule 31(2)(a) provided as follows: “
Whenever
a defendant is in default of delivery of notice of intention to
defend or of a plea, the plaintiff may set the action down
as
provided in sub rule (4) for default judgment and the Court may,
where the claim is for a debt or liquidated demand, without
hearing
evidence, and in the case of any other claim, after hearing
evidence, grant judgment against the defendant or make such
order as
to it seems meet.
”
12
Rule
31(5)(a) provides as follows:
“
(5)(a)
Whenever a defendant is in default of delivery of notice of
intention to defend or of a plea, the plaintiff, if he or she
wishes
to obtain judgment by default, shall where each of the claims is for
a debt or liquidated demand, file with the registrar
a written
application for judgment against such defendant: Provided that when
a defendant is in default of delivery of a plea,
the plaintiff shall
give such defendant not less than 5 days’ notice of his or her
intention to apply for default judgment.
[Paragraph (a) substituted by GN R785 of 5 June
1998.]
(b)
The registrar may –
(i) grant judgment as
requested;
(ii) grant judgment for
part of the claim only or on amended terms;
(iii) refuse judgment
wholly or in part;
(iv) postpone the
application for judgment on such terms as he may consider just;
(v) request or receive
oral or written submissions;
(vi) require that the
matter be set down for hearing in open court.
(c) The registrar shall
record any judgment granted or direction given by him.
(d) Any party
dissatisfied with a judgment granted or direction given by the
registrar may, within 20 days after he has acquired
knowledge of
such judgment or direction, set the matter down for reconsideration
by the court.
(e) The registrar shall
grant judgment for costs in an amount of R200 plus the sheriff’s
fees if the value of the claim as stated
in the summons, apart from
any consent to jurisdiction, is within the jurisdiction of the
magistrate’s court and, in other cases,
unless the application for
default judgment requires costs to be taxed or the registrar
requires a decision on costs from the Court,
R650 plus the sheriff’s
fees.
[Subrule 5 was inserted
by GN R2365 of 10 January 1994 and substituted by GN R417 of 14
March 1997.]”
13
See
Erasmus
Superior
Court Practice Commentary on Uniform Rule 31(5)(b)
:
Herbstein and Van Winsen
The
Civil Practice of the Supreme Court of South Africa
(1997) at 532
14
See
Entabeni
Hospital Ltd v Van der Linde
1994 (2) SA 422
(N);
Erf
1382 Sunnyside (Edms) Bpk v Chipi Bk
1995
(3) SA 659
(T)
15
See
Erf 1382
Sunnyside (Edms) Bpk v Die Chipi BK
supra
at 661 I-J;
Standard
Bank of SA Ltd v Ngobeni
1995 (3) SA 234
(V) at 235 D
16
See
Standard Bank
of SA Ltd v Saunderson and Others
2006 (2) SA 264
(SCA) at paragraph [24]
17
See
Standard
Bank of SA Ltd v Snyders and Eight Similar Cases
2005 (5) SA 610
(C) paragraphs [9] to [16] at pp 614E to 616E
18
See
Rules 30 and 30A
19
See
section 54(1)
of the
Close Corporations Act
20
See
J
& K Timbers (Pty) Ltd t/a Tegs Timbers v GL & S Furniture
Enterprises CC
2005 (3) SA 223 (NPD)
21
As
to the nature of the relationship between an attorney and client See
Goodricke &
Son v Auto Protection Insurance Co.
1968
(1) SA 717 (A) 722 H
22
See
California
Spice
supra
at 325h:
Lees
Import and Export (Pty) Ltd v Zimbabwe Banking Corporation Ltd
1999 (4) SA 1119
(ZSC) at 1124 H
23
California
Spice
case at 326gh
24
California Spice
case at 336h
25
Hallowes
v The Yacht “Sweet Waters”
1995
(2) SA 270
(D) at 276I –277D
26
California
Spice
case
at 326a
27
Lees
Import at 1124I; See also Annual Survey (1999) at 409
28
See
California
Spice
supra
at
pp 322 c to 340 f: See too
Lees
Import and Export
supra
at
1125EJ
29
See
Navy Two CC v
Industrial Zone Ltd
[2006]
3 ALL SA 263
(SCA) paragraph [13] at 266 e-g
30
See
the
California
Spice case
supra
at 338e, 331a, 336d and 33 h-i
31
In
regard to the need for express constitutional recognition of the
importance of fair resolution by a court see
Zondi
v MEC for Traditional and Local Government Affairs
2005
(3) SA 589
(CC)
32
The
spelling quoted follows the original.
33
Upon
enquiry by plaintiff’s attorney, the Sheriff denied that he had
expressed the opinion attributed to him in the lastmentioned
quote.
34
S
ee
section 34 of the Constitution of the Republic of South Africa,
1996.
35
See
sections 8(1) and 173 of the Constitution
36
See
section 179 of the Constitution
37
Compare
in this regard the provisions of section 50(3) of the Act which
augments the discretion of the court to order a member of
a
plaintiff corporation to pay costs of the corporation whenever it
unsuccessfully institutes proceedings without
prima
facie
grounds.
38
Compare
the argument raised by the
amicus
curiae
in the
California
Spice
case
supra
at p 341 g to 343 h.