BK Foyle also known as Bertram or Bert or B Koning and Another v D'Hooghe and Another (10315/01) [2006] ZAWCHC 44 (20 October 2006)

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[2006] ZAWCHC 44
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BK Foyle also known as Bertram or Bert or B Koning and Another v D'Hooghe and Another (10315/01) [2006] ZAWCHC 44 (20 October 2006)

IN THE HIGH COURT OF SOUTH AFRICA
(CAPE OF GOOD HOPE PROVINCIAL DIVISION)
CASE NO: 10315/2001
In the matter between:
B K FOYLE, ALSO KNOWN AS BERTRAM
OR BERT OR B KONING
1
st
APPLICANT
SANTAM INSURANCE COMPANY LTD
2
nd
APPLICANT
and
RUDY GASTON ADELARDUS D’HOOGHE
1
st
RESPONDENT
CARINE JEANNINE GHISLAINE D’HOOGHE
2
nd
RESPONDENT
___________________________________________________________________
JUDGMENT
___________________________________________________________________
This is an application brought by the Applicants (Defendants in the
main action) for the furnishing of security for costs by the
Respondents (Plaintiffs in the main action) in terms of Rule 47 of
the High Court Rules.
I intend to refer to the Applicants as the Defendants and the
Respondents as the Plaintiffs.
The summons commencing the said action in which the Plaintiffs claim
damages from the Defendants was issued in December 2001, and
was
served on the Defendants on the 5
th
December 2001.
On the 7
th
December 2001, the Defendants entered an
appearance to defend the action and the First Defendant filed his
plea on the 14
th
January 2002.
On the 14
th
January 2002, the Second Defendant noted an
exception against the Plaintiffs’ cause of action, but has never
set the exception
down for hearing.
On the 10
th
January 2002, the Defendants had served on
Plaintiffs’ attorney a notice in terms of Rule 47(1), calling upon
the Plaintiffs
to furnish security for costs in the said action,
contending that the Plaintiffs are
peregrini
of the above
Honourable Court.
It is common cause that the Plaintiffs are
peregrini
of the
above Honourable Court, the First Defendant is an
incola
of
this Court and the Second Defendant is a South African registered
company.
The Plaintiffs ignored the notice in terms of Rule 47(1).
Some 4½ years later, on the 21
st
June 2006, the
Defendants launched an application to compel the furnishing of
security for costs in the said action.
Affidavits were exchanged between the parties and the matter came
before me on the 19
th
October 2006.
At the commencement of the proceedings yesterday, Mr Fourie, who
appeared for the Plaintiffs, asked that the matter be postponed
to
enable the Plaintiffs to file a supplementary affidavit dealing with
the Plaintiffs’ financial position. The application
was moved
from the Bar without any notice of motion or supplementary affidavit
in support thereof. I was informed that the reason
why no affidavit
was before me was because Counsel had agreed to postpone the hearing
and there was accordingly no need to file
any papers. I took the
view that the matter should not be postponed and that it should be
argued on its merits. In the result,
I refused the application.
Mr Fourie then sought to introduce a supplementary affidavit annexed
to a notice of motion in which leave was sought to introduce
the
supplementary affidavit. The supplementary affidavit raised the
fact that the Defendants had delayed in the launch of the
application for security for costs. As the affidavit contained no
facts, but merely raised a legal argument, and which was in
any
event raised in the Heads of Argument, I declined the application
and ordered the Respondents to pay the costs of the application,
as
was tendered in the application.
In passing, I would mention that the said notice of motion and
supplementary affidavit were filed in the Court file without the
leave
of the Court and without the consent of the Defendants. In my
view this is a practice which is to be deplored. Where a party does
not have a right to file an affidavit, but is seeking an indulgence
to file such affidavit, such affidavit must be tendered from
the Bar
and not simply filed in the Court file.
The founding affidavit did not furnish an explanation as to why it
took a period of 4½ years to launch the application and also
failed
to deal with any prejudice which might have been occasioned to the
Plaintiff during the 4½ year period. In the answering
affidavit,
the Plaintiffs alleged that
inter alia
:-
they have “
legal assistance insurance
”;
the present action is being conducted from abroad and is extremely
expensive; and
they are not in a position to pay security for costs and if they
were so ordered, they would have to mortgage their home.
In the replying affidavit the Defendants alleged that the Plaintiffs
“
… have not taken any active steps aimed at finalising the
litigation, since close of pleadings during or about January 2002.

The Respondents (the Plaintiffs) have not filed a Rule 37
Questionnaire, nor have they applied for a trial date, nor have they

taken steps aimed at finalising the issues of discovery and expert
witnesses.
”
It is common cause that during the said 4½ year period, no other
pleadings were exchanged between the parties and, as stated,
the
Second Defendant took no steps to enrol the exception referred to
above. What caused the Defendants to launch the application
“out
of the blue” is not explained on the papers and the Court is “left
in the dark”.
The Plaintiffs’ attempts to paint a picture of impecuniosity in
their answering affidavit failed miserably. They did not set
out
their financial position in any detail nor furnish any detail
relating to their immovable property. It was indeed not surprising
that at the last hour, they attempted to file a fourth set of
affidavits dealing with their financial position, and which relief,
as stated, was refused to them.
A
peregrinus
who initiates an action against an
incola
in our courts
may
be ordered to furnish security for costs in
the action.
See :
Alexander v Jokl & Others, 1948(3) SA 269 (W) at
272/3
It seems that a
peregrinus
who avails himself of our courts
may be ordered by our courts, before they lend him any aid in his
action, to furnish security
for the
protection
of the
incola
.
See :
Thomson, Watson & Company v Poverty Bay
Farmers Meat Supply Company,
1924 CPD 93
;
and
Saker & Company Limited v Grainger,
1937 AD 223
at
227
It also seems clear that an
incola
’s right to claim such
security is a question of
practice
in which the Court has a
discretion
, after considering all the circumstances of the
case whether to order the furnishing of such security or not.
See :
Magida v The Minister of Police, 1987(1) SA 1 (A) at 12B
and 13H
The question of security for costs is a matter of equity and
fairness to both the
incola
and the
peregrinus
and it
is no longer our law that a Court should refuse such applications
“sparingly”.
See :
Magida’s case supra at 14D – 14F
Rule 47(1) provides that “
a party entitled and desiring to
demand security for costs from another shall,
as soon as
practicable after the commencement of the proceedings
,
deliver a notice
”. (Underlining supplied.)
In the case of
Agro Drip (Pty) Ltd v Fedgen Insurance Company
Limited, 1998(1) SA 182 (W) at 189H – J
, to which case Mr
van Heerden SC, who appeared for the Defendants, referred me,
Streicher J. (as he then was) perhaps mistakenly
referred to the
fact that the
application
had to be brought “
as soon as
practicable after commencement of proceedings…
”.
It is clear that the rule requires the notice, not the application,
to be served within that time period and, in my view, the application
should be launched thereafter without delay, or put another way
within a reasonable time thereafter.
See :
Wallace N.O. v Rooibos Tea Control Board, 1989(1)
SA 137 (C);
and
ICC Car Importers (Pty) Ltd v A Hartrodt SA (Pty) Ltd,
2004(4) SA 592 (W)
Mr Fourie, in opposing the application, contended that because of
the 4½ year delay in the launch of the application, I should
exercise the discretion vested in me and decline the relief sought.
Mr van Heerden SC argued that there were no factors which
indicated
that there was a delay and even if there was, a delay was no
automatic bar to the grant of the relief. In his argument,
Mr van
Heerden SC placed great reliance on the
Agro Drip
case
supra
, to which I will again refer hereafter.
It has of course been held that delay of itself is not necessarily a
fatal bar to the grant of such an application.
See :
SA Iron & Steel Corporation v Abdulnabi, 1989(2) SA
224 (T) at 236E – F
In my view, the fact that it took 4½ years to launch the
application, from the time of the issuing of the notice, constituted
a delay. Whether in a particular case a delay is reasonable or not,
will largely depend on the explanation furnished for such
delay.
In the very recent case of
B&W Industrial Technology (Pty)
Ltd & Others v Baroutsos, 2006(5) SA 135 (W) (Full Bench)
,
two applications for security for costs had been dismissed by the
Court a quo
primarily on the ground of the substantial delay
in bringing the applications (the delay was approximately two
years). At
p. 140 (par. 21)
Marais J., on behalf of
the Full Bench, stated “
In my view, the issue of delay was
adequately raised and,
in any event
, should
have been dealt with by the Appellants as, without explanation, the
delay was
prima facie unreasonable
and a
potential bar to the ordering of security
.”
(Underlining supplied.)
Both Counsel were agreed that I am bound by that decision.
In my view, there was unquestionably a long delay in the launch of
the application and there was a duty cast upon the Defendants
to
explain such delay, even though it was not raised on the papers.
Having failed to do so, I am enjoined to find, as I do, that
the
delay was unreasonable.
In the
Agro Drip case supra
, the Court was concerned with an
application for security for costs in terms of Section 13 of the
Companies Act, no. 61 of 1973.
At
p. 186F
Streicher
J. (as he then was) found that: “
There is every reason to
believe that the Plaintiff will not be able to pay the costs…
”.
Having so found, he went on to state at
p. 187B
that:
“
Even if there is no
onus
upon the
Plaintiff
to prove special circumstances, the
Plaintiff
… should allege facts which at least
prima facie establish whatever circumstances are contended by it…
militating against requiring
the Plaintiff to furnish security…
”.
(Underlining supplied.)
In my view, the facts of the present case are clearly
distinguishable from the
Agro Drip case
. In the present case
there was, as I have found, an unreasonable delay on the part of the
Defendants and in these circumstances
I would find that the
Defendants should have alleged facts which, at least
prima facie
,
establish that during that 4½ year period, the Plaintiffs sustained
no prejudice.
See :
Ferreira v Endley, 1966(3) SA 618 (EC) at 621E –
F;
and
Tarry & Company Ltd v Matatiele Municipality,
1965(3) SA 131 (EC) at 134A – C
In my view, where a party delays in the launch of such an
application, such party must put up facts – not only to explain
the
delay, but must go further and put up facts which establish at
least
prima facie
, that the opposing party has not been
prejudiced by the delayed application.
I would extend the principle enunciated by the Full Bench in the
B&W
case supra
where they found that an unreasonable delay was a
“potential bar” to the ordering of security. In my view, where
a party has
both failed to explain the delay (resulting in a
prima
facie
case of unreasonable delay) and failed to put up facts
concerning the absence of prejudice, a Court should be extremely
loathe
to order security.
Mr van Heerden SC placed reliance on the case of
Tamarillo
(Pty) Ltd v B N Aitken (Pty) Ltd, 1982(1) SA 398 (A) at 443F – G
,
a case concerned with specific performance and the discretion vested
in a Court, and submitted that the Defendants could not have
said
anything about prejudice in the founding papers, but the Plaintiffs
should have raised the question of prejudice in their
answering
papers. I cannot agree with that submission. In the view I take of
the matter it was for Defendants, given the facts
of this case, to
put up facts to establish at least
prima facie
an absence of
prejudice.
It goes without saying that, during the said 4½ year period, the
Plaintiffs must have incurred some costs. A perusal of the bill
of
costs put up by the Defendants reveals that, during 2005, the
parties corresponded with each other concerning a possible
settlement
of the matter.
In the circumstances and due to the Defendants’ failures
aforesaid, I am not prepared to exercise the discretion vested in me
in ordering the Plaintiffs to furnish security for costs in the
action against Defendants, notwithstanding the fact that the
Plaintiffs
failed on the papers to establish impecuniosity or any
other ground for the refusal of the relief.
In the circumstances, the application is dismissed with costs.
_____________________
PINCUS A.J.
20
TH
OCTOBER 2006