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[2020] ZASCA 36
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MTEC Rustenburg and Others v Capricorn District Municipality (743/2018) [2020] ZASCA 36 (6 April 2020)
THE SUPREME COURT OF
APPEAL OF SOUTH AFRICA
JUDGMENT
In
the matter between:
Not Reportable
Case
no: 743/2018
MTEC RUSTENBURG
CC
FIRST APPLICANT
N T
TSEBE
SECOND APPLICANT
DIKGWETLO
TRADING
CC
THIRD APPLICANT
and
CAPRICORN DISTRICT
MUNICIPALITY
RESPONDENT
Neutral
citation:
MTEC Rustenburg and Others v Capricorn
District Municipality
(Case no 743/2018)
[2020] ZASCA 36
(06
April 2020)
Coram:
Ponnan, Saldulker and Mokgohloa JJA and Gorven and Eksteen AJJA
Heard
:
28 February 2020
Delivered
:
06 April 2020
Summary
:
Reconsideration of an order refusing special leave to appeal by two
judges of the Supreme Court of Appeal (SCA) in terms of s
17(2)(
f
)
of the
Superior Courts Act 10 of 2013
.
ORDER
The
application for reconsideration is dismissed with costs, such costs
to be paid jointly and severally by the first and second
applicants,
the one paying the other to be absolved.
JUDGMENT
Mokgohloa
JA (Ponnan and Saldulker JJA and Gorven and Eksteen AJJA concurring)
[1]
This is an application for the reconsideration of an application for
special leave to appeal, brought in terms of
s 17(2)(
f
) of the
Superior Courts Act 10 of 2013 (the Act).
[2]
The application falls to be considered against the backdrop of the
following facts: On 22 February 2008, Dikgwetlo Trading CC
(Dikgwetlo), the third applicant, and an entity known as MTEC
Holdings (Pty) Ltd (Holdings) entered into a joint venture agreement.
The purpose of the joint venture was to bid for a tender issued by
the respondent, the Capricorn District Municipality, under project
number: CON – EO219/2008 for the construction of the Blouberg
Landfill. On 30 April 2008 the tender was successfully awarded
to the
joint venture. On 15 September 2008, Dikgwetlo withdrew from the
joint venture, at which point the respondent instructed
Holdings not
to continue with the work.
[3]
On 29 July 2011 the first applicant, MTEC Rustenburg CC (the CC)
issued summons against the respondent out of the Gauteng Division
of
the High Court, Pretoria, claiming payment of monies due for work
done and services rendered, ostensibly in terms of the tender.
The
claims were based on the respondent’s alleged breach of its
obligation in terms of the tender agreement.
[4]
The respondent defended the action and pleaded, amongst other things,
that the CC did not have locus standi to sue and that
the summons was
issued without timeously serving a notice in terms of s 3 of the
Institution of Legal Proceedings against certain
Organs of State Act
40 of 2002. On 19 September 2011 the CC and the second appellant,
Naomi Tracey Tsebe (Ms Tsebe), who described
herself as ‘the
only member of the [CC]’, launched an application for
condonation in terms of s 3(4) of that Act.
[5]
On 1 February 2013, and on the application of the CC and Ms Tsebe,
Dikgwetlo was joined by the high court as the second plaintiff
in the
action and the third applicant in the condonation application.
Dikgwetlo, however, took no part in the proceedings either
before the
high court or this court. The condonation application was heard by
Pretorius J, who, on 26 January 2018, dismissed the
application inter
alia on the grounds that the applicants failed to: (i) establish
adequate prospects of success in the main action;
(ii) give a
reasonable explanation for the delay in giving the notice; (iii)
satisfy the court that the debt has not been extinguished
by
prescription; and (iv) satisfy the court that the organ of state will
not be unreasonably prejudiced. An application for leave
to appeal
against the high court’s decision was subsequently refused by
Pretorius J.
[6]
The applicants then applied to this court in terms of s 16(1)(
b
)
of the Act for leave to appeal the decision of the high court. The
two judges of this court, who considered the petition in chambers,
dismissed it on the grounds that there were no reasonable prospects
of success on appeal and that there was no other compelling
reason
why the appeal should be heard. The applicants thereupon applied to
the President of this court, in term of s 17(2)(
f
) of the Act,
for a reconsideration of the refusal of leave by the two judges of
this court. The President made an order referring
the reconsideration
application for the hearing of oral argument. It is this application
which now serves before us.
[7]
We are thus required to consider whether there are circumstances
which warrant the reconsideration or variation of the earlier
order
of the two judges of this court dismissing the application for leave
to appeal.
[8]
Section 3 of the Institution of Legal Proceedings against certain
Organs of State Act 40 of 2002 provides:
‘
3 Notice of
intended legal proceedings to be given to organ of state
(1) No legal
proceedings for the recovery of a debt may be instituted against an
organ of state unless—
(a)
the
creditor has given the organ of state in question notice in writing
of his or her or its intention to institute the legal proceedings
in
question; or
(b)
the
organ of state in question has consented in writing to the
institution of that legal proceedings—
(i) without such
notice; or
. . .
(ii) upon receipt of
a notice which does not comply with all the requirements set out in
subsection (2).
(4)
(a)
If an organ of state relies on a creditor’s failure to
serve a notice in terms of subsection (2)
(a)
, the creditor may
apply to a court having jurisdiction for condonation of such failure.
(b)
The court may grant an application referred to in paragraph
(a)
if
it is satisfied that—
(i) the debt has not
been extinguished by prescription;
(ii) good cause
exists for the failure by the creditor; and
(iii) the organ of
state was not unreasonably prejudiced by the failure.’
[9]
The
requirement of good cause contained in s 3(4)(
b
)(ii)
involves an examination of all the factors which bear on the fairness
of granting the application of
condonation
and
the
proper
administration
of
justice.
These
may
include
prospects
of success in the proposed action, the reasons for the delay in
giving notice, the sufficiency of the explanation proffered,
the bona
fides of the applicant, and any contribution
by
other
persons
or
parties
to
the
delay
and
the
applicants’
responsibility
therefor.
[1]
[10]
I shall for present purposes restrict myself to a consideration of
the prospects of success in the contemplated action. The
CC sought to
persuade us that it was a party to the contract with the respondent
and thus entitled to sue on it. In that regard
reliance was sought to
be placed on a letter dated 16 September 2008, which reads: ‘It
is therefore, imperative to record
inter alia
the following;
for all intents and record purposes:
1. M-TEC Holdings
was and is still the appointed representative of the JV as per
provisions of the JV agreement and such powers
as vested upon M-TEC
still subsist.
2. According to the
provisions of the JV agreement, M-TEC will further take the lead in
the administrative and operational matters
of the JV.
3. The withdrawal of
Dikgwetlo Trading from the JV, therefore causes no
reasonable/irreparable damage nor prejudice to the Capricorn
District
Municipality, hence work as provided for in the service
agreement/tender specifications is being carried forward as
reasonably
expected.’
[11]
Accordingly, so the contention went, the reference to M-TEC was a
reference to the CC. Several difficulties stand in the way
of this
contention. First, that letter emanated from Ms Tsebe, not the
respondent. Second, paragraph one of the letter refers to
M-TEC
Holdings. One would have thought that the subsequent references to
M-TEC would be a reference to Holdings, not some other
entity such as
the CC. Third, there is no reference at all to the CC in any of the
documents on which reliance is sought to be
placed for the claim,
which is founded in contract. The only joint venture agreement
appearing on the papers is the one between
Holdings and Dikgwetlo.
This was concluded on 22 February 2008 for the express purpose of
submitting a tender for the project.
It was signed on behalf of
Holdings by Ms Tsebe. The tender was awarded to the joint venture.
The CC is not a party to the joint
venture. Nor is it a party to the
tender that was awarded by the respondent to the joint venture. It is
a stranger to those agreements.
[12]
It follows that any claim by the CC based on those agreements cannot
succeed. Pretorius J can thus not be faulted for dismissing
the CC’s
application for condonation. The CC’s envisaged action against
the respondent is plainly a non- starter. The
learned judge was
accordingly correct to have dismissed the application for leave to
appeal. The same holds true for the two judges
of this court, who
also dismissed with costs the further application to this court for
leave to appeal.
[13]
In the result:
The
application for reconsideration is dismissed with costs, such costs
to be paid jointly and severally by the first and second
applicants,
the one paying the other to be absolved.
___________________
FE
Mokgohloa
Judge
of Appeal
Appearances
For
Applicants: C D Pienaar
Instructed
by: Seokane Lesomo Inc., Midrand
Honey
Attorneys, Bloemfontein
For
Respondent: E C Labuschagne SC
Instructed
by: Matabene Incorporated, Pretoria
EG
Cooper Majiedt, Bloemfontein.
[1]
See Madinda v Minister of Safety and Security
[2008] ZASCA 34
;
[2008] 3 All SA 143
(SCA);
2008 (4) SA 312
(SCA) para 10.