Golden International Navigation SA v Zeba Maritime Comapny Limited, Zeba Maritime Company Limited v Visvliet (AC 104/07, AC 41/97) [2007] ZAWCHC 67; 2008 (3) SA 10 (C); (28 November 2007)

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[2007] ZAWCHC 67
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Golden International Navigation SA v Zeba Maritime Comapny Limited, Zeba Maritime Company Limited v Visvliet (AC 104/07, AC 41/97) [2007] ZAWCHC 67; 2008 (3) SA 10 (C); (28 November 2007)

in
the high court of South Africa
(cape
of good hope provincial division)
(Exercising
its Admiralty Jurisdiction)
Case
No AC 104/07
Name
of Vessel: MV
Visvliet
In
the matters between:
golden
international navigation SA
Applicant
And
zeba
maritime company Limited
Respondent
Case
No AC 41/97
zeba
maritime company Limited
Plaintiff
And
mv
visvliet
Defendant
judgment
delivered: 28 November 2007
Griesel
J:
Introduction
The
history of this litigation commenced more than a decade ago, on 14
March 1997, when Zeba Maritime Company Limited (
the plaintiff
),
a company registered in Athens, launched an admiralty action
in
rem
in this court under Case No AC 41/97 (
the main
action
) against the vessel MV
Visvliet
(as defendant) for
payment of US $82 282.31 in respect of the purchase price of
bunkers sold and delivered by the plaintiff
to the defendant. The
defendant vessel was arrested on the same date, but was
subse­quently released after security for the
claim had been
duly furnished on its behalf.
In
particulars of claim subsequently filed, two further amounts were
added to the plaintiff’s claims, which were formulated as
follows:
(a) During
December 1996 the plaintiff and the owner of the vessel, represented
by ‘an employee of the Managers of the defen­dant,
Sateda
Ship­management BV’ (
Sateda
), concluded an agreement in
terms of which the plaintiff sold and delivered to the owner of the
vessel certain lubricants as ordered
on 25 December 1996 to the value
of US $6 223,05 and on 4 February 1997 to the value of
US $9 404,03.
(b) On
or about 31 January 1997, one Fred Bolland, ‘an employee of the
managers of the defendant, Sateda, acting on behalf of the
owner of
the vessel’, concluded a further agreement with the plaintiff for
the sale and delivery of a quantity of bunkers to the
vessel at
Singapore as ordered.
According
to the plaintiff, the owner of the vessel failed to pay the amounts
owing in respect of the lubricants and bunkers, being
the total sum
of US$97 907.39, which amount is being claimed from the
defendant as a ‘maritime claim’, as contemplated
by s 1(1)(
m
)
of the Admiralty Juris­diction Regulation Act 105 of 1983 (
the
Act
).
Golden
International Navigation SA (
GIN
), a company registered in
Panama and claiming to be the owner of the vessel, filed a plea in
which it denied,
inter alia
, that it or anyone on its behalf
entered into any contract with the plaintiff. It also denied that
Bolland or Sateba was its agent
and denied that either of the two
had any authority to enter into any contract
on
behalf of
the owner.
Further
particulars were requested and furnished; discovery was called for
and made; further discovery was called for in terms of
Uniform Rule
35(3); and various interlocutory applications were launched,
inter
alia
, one by the defendant for security for costs and one by the
plaintiff to compel delivery of trial particulars. Finally, on 10
September
2001, the plaintiff (belatedly) filed a replica­tion
in which it denied that GIN was the owner of the vessel or that it
had
locus standi
to defend the action
on
behalf of
the vessel.
At
that stage, the matter became dormant and remained so until June
2006, when GIN eventually took the initiative by setting the
action
down for trial. At the same time, it launched an application for an
increase in security for costs. The plaintiff opposed
this
application and, in turn, launched two interlocutory applications of
its own – one for an increase in the security already
provided by
GIN for the plaintiff’s claim and the other to compel further
discovery. Both of these applications are being opposed
by GIN.
While
the interlocutory applications were pending, GIN launched a
sub­stantive application (under Case No AC 104/07) to strike
out
the plaintiff’s claim the basis that it is vexatious and/or an
abuse of the process of the court. It is that application
which
forms the subject matter of the present judgment.
Legal
principles
In
terms of rule 20(1) of the Admiralty Rules, ‘the court may strike
out any proceedings which are vexatious or an abuse of the
process
of the court’. I have not been referred to any decision where this
rule has been pertinently invoked, nor have I been
able to find any
such decision. In the absence of any definition or binding authority
to the contrary, I have no doubt that the
rule contemplates that the
common law principles should be applied whenever this rule is
invoked by a litigant.
It
is well settled at common law that ‘every court has an inherent
right to prevent an abuse of its process in the form of frivolous
or
vexatious liti­gation’.
1
An action may be held to be vexatious if it is ‘obviously
un­sustainable’,
2
or ‘frivolous, improper, insti­tuted without sufficient
ground, to serve solely as an annoyance to the defen­dant’.
3
A factor that is often taken into account by the courts when
considering whether a particular proceeding amounts to an abuse of
the process is the fact that there has been an inordinate delay in
proceeding with the action.
4
The
present application rests on a twofold basis: first, the perceived
lack of merit in the plaintiff’s claim to the extent, so
it is
claimed, that it is ‘unsustainable’; and, second, the inordinate
delay and the failure on the part of the plaintiff to
prosecute its
claim.
Lack
of merit
The
plaintiff’s action
in rem
is brought in terms of s 3(4)(
b
)
of the Act. For the plaintiff to succeed, it must prove that the
owner of the property to be arrested would be liable to it in
an
action
in personam
in respect of the cause of action
concerned.
The
plaintiff’s first difficulty is that it does not know who the
owner of the vessel was at the relevant time. It initially denied
in
its replication that GIN was indeed the owner, but has applied to
withdraw that denial and to replace it with an allegation
that it
has no knowledge of that fact. The high-water mark of the
plaintiff’s attempt to establish a contractual
nexus
between itself and the owner of the vessel is to be found in the
witness statement
5
of a certain Ms Mairini Stefanides, an employee of the plaintiff,
who states that during the latter part of January 1997 she was
contacted by Bolland of Sateda, who placed the order for the
lubricants and the bunkers with the plaintiff and who allegedly
‘confirmed
to her that he acted
on behalf of
the owner of the MV
Visvliet
’. (No mention is made
as to the identity of the owner.)
Leaving
aside for the moment the inherent unreliability of the hearsay
evidence tendered, the more fundamental difficulty with the
plaintiff’s evi­dence is that ‘it is, of course, clear that
the fact of an agency cannot be established from the declarations
of
the alleged agent.’
6
Or, as it was put by Wigmore:
7
‘
The
fact of agency must of course be somehow evidenced before the
alleged agent’s declarations can be received as admissions;
and
therefore the use of the alleged agent’s hearsay assertions that
he is agent would for that purpose be inadmissible, as merely
begging the very question.’
8
The
case for the plaintiff is further weakened when the evidence put up
in rebuttal on behalf of GIN is considered. In the witness
statement
(under oath) by its President, Mr Pablo Espino, he denies that GIN
had ap­pointed Sateda as its agents in respect
of the vessel.
Moreover, he explains that, after GIN acquired the vessel in June
1996, it was demise-chartered to Miraflora Shipping
Incorporated
(
Miraflora
) as bareboat charterers, from which date the
vessel was completely under the control of Miraflora.
These
allegations are borne out by the documentary evidence dis­covered
by both GIN and the plaintiff. Thus, the plaintiff’s
bunker
receipts confirm that it was indeed Miraflora which fuelled and
operated the vessel at the relevant time and that Sateda
was acting
as Miraflora’s managing agents.
The
result is that, both in terms of the demise charter in question and
the applicable law, Miraflora – and not the owner –
was
responsible to bunker the vessel at all relevant times.
9
Against
this background, it is clear to me that the hearsay allegations of
Ms Stefanidis as to what she had been told by Bolland
do not carry
much weight. I am accordingly driven to the conclusion that the
plain­tiff is not in a position to prove that
it has a
sustainable claim
in personam
against the owner of the
vessel.
Delay
With
regard to the question of delay, it appears that the pleadings were
closed ten days after the filing of the defendant’s plea
on 18
March 1998.
10
After that date, certain pre-trial steps were admittedly taken by
both parties. However, it is undisputed on the papers before
me
that, during the entire period between 2001 and 2006, the plaintiff
did not set the matter down for trial, nor did it take
any
further steps to bring the matter to finality. The only expla­nation
for this inactivity is the terse statement that ‘the
plaintiff was
unable to advance its action due to administrative funding
problems’.
I
am not impressed by this statement, which neither explains nor
excuses the plaintiff’s inactivity, nor am I impressed by the
plaintiff’s belated reliance on the provisions of s 34 of the
Constitution. While everyone undoubtedly has the right to
have any
dispute decided in a fair public trial before a court, there are
rules governing any public trial. One of the most fundamental
principles in this regard is that it is in the public interest that
liti­gation be finalised without undue delay:
interest
reipublicae ut sit finis litium
, as it was stated by the Romans
many years ago. Indeed, Emperor Justinian, in Codex 3.1.11, decreed
that civil suits shall not,
after
litis contestatio
, be
deferred longer than three years.
11
The potential ‘tyranny of litigation’, aggra­vated by undue
delay, has also been recognised by our courts on many occasions
12
and every system of civil procedure has rules to curb violation of
the rules and abuse of its process.
13
The
crisp question for decision is whether the delay in this instance
has been so unreasonable or inordinate as to amount to an
abuse of
the process of the court.
A
useful starting point is to be found, in my view, in the comment by
Flemming DJP,
14
that ‘reasonableness would then be influenced,
inter alia
,
by the reasons for a plaintiff's delay – an issue on which the
present plaintiff is completely silent’. In this instance the
plaintiff, although not silent, has furnished a wholly unacceptable
explanation.
Further
guidelines regarding the question of reasonableness are to be found
in the provisions of rule 37A which, notwithstanding
its repeal, is
still applicable to this matter.
15
The principal aim of that rule was to create a measure of judicial
control over a process that is otherwise left entirely in the
hands
of practitioners.
16
Thus, the rule makes provision for directions to be issued by a
judge after the ‘entry date’ (which occurs at the close of
pleadings) and for a timetable to be deter­mined within which to
comply with such directions. A ‘compli­ance date’
must be
fixed, which must not be later than
eight months
after the
‘entry date’.
17
If, at the compliance date, a matter is still not ready for trial,
it may be referred to the ‘not ready list’, which has to
be
maintained by the registrar.
18
If a matter has been on the not ready list for
three months,
a
default hearing must be held unless the plaintiff applies to have
the matter removed from such list.
19
Finally, where proceedings have remained on the not ready list for
more than
twelve months
, the registrar shall refer the matter
to the judge president, ‘who shall make such orders as he or she
considers necessary …
including, where appropriate, orders as to
costs and for the dismissal of the action’.
20
Thus, the rule envisages a period of roughly
two years
from
the date of inception of the action until final disposal. The
present matter would ordinarily have already surpassed that
milestone as long ago as some time during 1999.
A
further indication as to the reasonableness of delay in the context
of maritime claims is to be found in s 3(10)(
a
)(ii) of
the Act, which provides that property deemed to have been arrested
or attached ‘shall be deemed to be released and discharged
therefrom if no further step in the proceedings, with regard to a
claim by the person con­cerned, is taken within
one year
of the giving of any such security or under­taking’. (Emphasis
added.) In the present instance, the plaintiff did take further
steps within the period of one year after security was furnished
on
behalf of
the defendant. I accept, therefore, that the
provisions of the section do not apply literally to the present
situation. Nonetheless,
the pro­visions in question are a clear
indica­tion, in my view, that it was not contemplated that
security would remain
in place in­definitely while the
dominus
litis
takes no steps to bring matters to finality. It also
provides an indication of the time period regarded as reason­able
in this
context.
Judged
by all these yardsticks, it is clear to me that the delay on the
part of the plaintiff in the present matter is unreasonable
and
should not be condoned by this court. I am fortified in this
conclusion by a dictum of Denning LJ in
Krakauer v Katz
,
21
to the effect that â€“
‘…
if
a plaintiff allows an action to go to sleep for six years, the Court
in its discretion will usually dismiss the case for want
of
prosecution, unless the plaintiff can show some good reason why he
should be allowed to go on with it’.
The
fact that the present plaintiff allowed the present action ‘to go
to sleep’ for approximately five years (and not six) makes
no
difference to the principle involved. I have no doubt that similar
reasoning should apply to the present matter. No good reason
has
been shown by the plaintiff why it should now – more than ten
years after the cause of action arose – be allowed, at great
expense, to proceed with a claim that appears to be doomed to fail.
Conclusion
I
am mindful of the fact that the court’s power to strike out a
claim on the basis that it is vexatious or an abuse of its process
is an exceptional one which must be exercised with very great
caution, and only in a clear case. However, I respect­fully

disagree with
dicta
that go further by requiring that this
conclusion ‘must appear
as a certainty
and not merely on a
preponderance of probability.’
22
(My emphasis.) This requirement appears to originate from a
dictum
in the minority judgment of Holmes JA in the
African Farms &
Townships
case. The two cases
23
cited by the learned judge of appeal in support of this proposition
do not, how­ever, provide such support. Furthermore, the
propo­sition flies in the face of our rules of evidence, by
which a preponderance of probability in favour of a litigant is
sufficient to decide any civil case in favour of such litigant.
(Even the most serious criminal charge is decided beyond reasonable
doubt, and not with ‘certainty’.) I accordingly respectfully
decline to follow the authorities that appear to lay down such
a
requirement.
For
the reasons furnished above, I am of the view that the plaintiff’s
action ‘obviously unsustainable’. Coupled with the
inordinate
delay and the failure on the part of the plaintiff to prosecute its
claim to finality, it is clear to me that the continuation
of the
plaintiff’s action will be vexatious and hence an abuse of the
process of this court, as contemplated by rule 20(1) of
the
Admiralty rules as well as the common law.
In
the circumstances, the following order is granted:
(a) The
plaintiff’s action under Case No AC 41/97 is struck out.
(b) The
letter of undertaking dated 6 November 2003, issued by Nedbank Ltd in
favour of the plaintiff, is to be returned to the applicant
forthwith.
(c) The
plaintiff (respondent) is ordered to pay the costs of the main
action, as well as this application under Case No AC 104/07,
such costs to include the costs of two counsel.
(d) With
regard to the various interlocutory applications which are still
pending, no orders are made, save that the plaintiff is
ordered to
pay the costs of those applications, including the costs of two
counsel. This part of the order is provisional and shall
become final
unless written notice is given by either party within 10 days from
date of this judgment, requesting the court to reconsider
this aspect
of the order.
B
M Griesel
Judge of the High Court
1
Western
Assurance Co v Caldwell’s Trustee
1918
AD 262
at 271. See also
Fisheries
Development Corporation of SA Ltd v Jorgensen & Another
1979
(3) SA 1331
(W) at 1338F–G; Harms
Civil
Procedure in the Superior Courts
(1990
with loose-leaf updates) p A3.5 (Service Issue 34); Herbstein &
Van Winsen
The
Civil Practice of the Supreme Court of South Africa
4ed (1997) pp 247–248and 546–547.
2
Ravden
v Beeten
1935
CPD 269
at 276;
African
Farms & Townships v Cape Town Municipality
1963 (2) SA 555
(A) at 565D–E.
3
Fisheries
Development Corporation of SA Ltd v Jorgensen & Another;
Fisheries Development Corporation of SA Ltd v AWJ Investments
(Pty)
Ltd & Others
above
n 1 at 1339E–F;
Bisset
& Others v Boland Bank Ltd & Others
1991
(4) SA 603
(D) 608D–E.
4
Schoeman
en Andere v Van Tonder
1979 (1) SA 301
(O) at 305A–F;
Kuiper
& Others v Benson
1984
(1) SA 474
(W) at 476H–477A;
Molala
v Minister of Law and Order & Another
1993
(1) SA 673
(W) at 676B–679I;
Bissett
& Others v Boland Bank Ltd & Others
1999
(4) SA 603
(D) at 608C–E;
Sanford
v Haley NO
2004
(3) SA 296
(C) para 8.
5
Filed
in compliance with the erstwhile rule 37A(16)(
a
).
6
Rosebank
Television & Appliance Co (Pty) Limited v Orbit Sales
Corporation (Pty) Limited
1969 (1) SA 300
(T) at 303D–E, with reliance on
R
v Koro
1950 (3) SA 797
(O) at 802F–G and
Strathsomars
Estate Co Ltd v Nel
1953 (2) SA 254
(E) at 257B. See also
Covary
v Registrar of Deeds and Others
1949 (2) SA 719
(A) at 728;
Van
Niekerk v Van den Berg
1965 (2) SA 525
(A) at 537F–G.
7
4
Wigmore
Evidence
(1972)
§1078 at p 176.
8
In
footnote 5, the learned author cites numerous American authorities
for this proposition, eg: ‘Agency and authority cannot be
proved
by the hearsay statements of the alleged agent himself’; and
‘[t]he authority of an agent cannot be proved by the declarations
of the agent.’
9
Cf
Shipping Law and Admiralty Jurisdiction in South Africa
(1999)
p 583; Hofmeyr
Admiralty Jurisdiction Law and Practice in South Africa
p 105, and the cases referred to in footnotes 52 and 53 on that
page.
10
In
terms of Admiralty rule 9(2)(
c
).
11
See
Sanford
v Haley NO
above n 4 at 299H–I.
12
Cf
Juta
& Co Ltd v Legal and Financial Publishing Co (Pty) Ltd
1969 (4) SA 443
(C) at 445F;
Vollenhoven
v Hoenson & Mills
1970 (2) SA 368
(C) at 372B;
Chopra
v Avalon Cinemas SA (Pty) Ltd and Another
1974 (1) SA 469
(D) at 472H.
13
Cf
Western
Assurance
case,
footnote above,
loc
cit.
14
Molala
above n 4 at 676G.
15
GN
R373, 30 April 2001, para 3(2).
16
Cf
Molala
above
n 4 at 679D.
17
Subrule
(5)(j).
18
Subrule
(14)(j), read with subrule (15)(a).
19
Subrule
(15)(b).
20
Subrule
(15)(f).
21
[]
1 All ER 244
(CA) at 246A, quoted with approval by Brink J in
Schoeman
en Andere v Van Tonder
above n 4 at 305B.
22
African
Farms & Townships
above n 2 at 565D–E; followed in
Bisset’s
case above n 3 at 608F–G.
23
Ravden
v Beeten
above n 2 at 276; and
Burnham
v Fakheer
1938 NPD 63.