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[2024] ZAFSHC 172
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Standard Bank of South Africa Limited v Maree N.O and Others (6038/2023) [2024] ZAFSHC 172 (24 May 2024)
SAFLII
Note:
Certain
personal/private details of parties or witnesses have been
redacted from this document in compliance with the law
and
SAFLII
Policy
IN
THE HIGH
COURT
OF SOUTH AFRICA
FREE
STATE DIVISION, BLOEMFONTEIN
Reportable: YES/NO
Of Interest to other
Judges: YES/NO
Circulate to
Magistrates: YES/NO
CASE
No.:
6038/2023
In
the matter between:
THE
STANDARD BANK OF SOUTH AFRICA LIMITED
Applicant
and
DEON
CORNELIUS MAREE N.O.
First Respondent
JOHANNA
GERTRUIDA MAREE N.O
.
Second
Respondent
PETRUS
JOHANNES UYS N.O.
Third Respondent
GOLDENSANDS
31 TRADING
CC
Fourt Respondent
JUDGMENT
BY
:
VAN RHYN, J
HEARD
ON:
14 MARCH 2024
DELIVERED
ON:
24 MAY 2024
THE
PARTIES AND THE RELIEF CLAIMED.
[1]
The applicant, Standard Bank
of South Africa Limited ("Standard Bank") seeks to enforce
the terms of a settlement agreement
reached between the parties and,
as a consequence, judgment against the respondents, jointly and
severally,
the
one paying the
other
to
be
absolved
including
executability
of
their
immovable
property.
The application is
based upon a settlement agreement concluded with the trustees of the
DC Maree Trust IT1195/95 and the sole member
of Goldensands
31 Trading CC
.
[2]
The trustees of the
DC Maree Trust, namely Deon Cornelius Maree ("Mr Maree"),
Johanna Gertruida Maree ("Mrs Maree")
and Petrus Johannes
Uys ("Mr Uys"), have been cited as the first, second and
third respondents in their representative
capacities ("the DC
Maree Trust") and Goldensands 31 Trading CC ("Goldensands")
as the fourth respondent. The
DC Maree Trust and Goldensands are
referred to as the respondents. The respondents pray for the
dismissal of the main application
as set out above, alternatively, as
set out in a counter application, a stay of the main application
pending the final determination
of the respondents' action instituted
in the Gauteng Division of the High court, Pretoria, further
alternatively, a referral of
the matter to be heard by way of action.
[3]
Standard Bank seeks
an order in the following terms
:
1.
Judgment
against
the
DC Maree Trust and
Goldensands,
jointly
and severally, the
one to pay the others to be absolved, in terms of the Settlement
Agreement including an acknowledgement of indebtedness,
for the
following amounts together with further interest, as more fully set
out in paragraph 1.1 - 1
.
16
of the Notice of Motion:
1.1
R31 380,852.56 in
respect of account no[…];
1.2
R325,207.99 in
respect of account no[…];
1.3
R189,213.70 in
respect of account no […];
1.4
R189,213.70 in
respect of account no[…];
1.5
R681,898.36 in
respect of account no[…];
1.6
R239,594.41 in
respect of account no[…];
1.7
R239,594.41 in
respect of account no[…];
1.8
R249,885.91 in
respect of account no[…];
1.9
R1,134,186.02 in
respect of account
no[…];
1.10
R3,742,954.61 in respect of
account no[…];
1.11
R2,207,900.08 in
respect of account
no[…];
1.12
R983,340.54 in
respect of account no[…];
1.13
R672,952.00 in
respect of account
no[…];
1.14
R5,208,902.21 in
respect of account no[…];
1.15
R400,000.00 in
respect of account
no[…];
1.16
R7,000,000.00 in
respect of account no[…].
2.
Alternatively,
Standard Bank moves for judgment against the DC
Maree Trust for the
following amounts plus further interest:
2.1
R38,570,000.00 as
guarantor;
2.2
R400,000.00 on a
medium term loan;
2.3
R7 000,000.00 on a
medium term loan.
2.4
and against
Goldensands
in
the total amount of
R26,000,000.00 as guarantor.
3.
Standard Bank
furthermore moves for an order that various properties as more fully
described in paragraph 3.1 to 3.5 in the notice
of motion (the
"farms"),
registered in
the name of the D C Maree Trust as well as in the name of
Goldensands, be declared specially executable.
BACKGROUND
FACTS.
[4]
The DC Maree Trust
entered into two medium term loan agreements with Standard Bank at
Harrismith on 30 September 2014 and on 17
October 2019 respectively.
The outstanding
balances
on
these
loan
agreements
amount d
to
R400 000.00
and R7 000 000.00 on
18 September 2023. The DC Maree Trust furnished Standard Bank with
the following guarantees for the due, punctual
and full payment of
all debts of Mr Maree:
4.1
on 17 March 2017 for
the amount of R15 000 000.00 (with interest and costs) as is evident
from Annexure "G1" to the founding
affidavit;
4.2
on 18 March 2019 for the
amount of RS 000 000.00 (with interests
and
costs) as is
evident from Annexure "G2" to the founding affidavit;
4.3
on 27 October 2019
for the amount of R18 570 000.00 (with
interests
and costs) as
is evident from Annexure
"G3"
to the
founding affidavit.
[5]
Goldensands furnished
Standard Bank with the following guarantees for the due, punctual and
full payment of all debts of Mr Maree:
5.1
On 17 March 2017 in
the amount of R12 000 000.00 (with interests and costs) as
is
evident from
annexure
"11
";
5.2
On 17 October 2019 in
the amount of R14 000 000.00 (with interests and costs) as is evident
from annexure ''12"
.
[6]
Apart from the
commercial and contractual relationship between the parties it is
apposite to refer to,
inter
alia,
the
following litigious history:
On
30 June 2023 Standard Bank obtained a
rule
nisi,
granted
in this court by Mhlambi J, on an urgent
ex
parte
basis
(the
"perfection
application")
against Mr and Mrs Maree (in their personal capacities) calling upon
them to show cause on 3 August 2023 why
the notarial covering bond
(BN4976/2022) by Mr and Mrs Maree in favour of Standard Bank should
not be perfected to the maximum
sum of R10 000 000.00
and the additional
sum
of R2 500 000.00 and that the Sheriff be authorized
and directed to
attach all movable property situated on 5 farms referred to in the
said order.
[7]
The
rule
nisi
furthermore
included the following: the notarial special covering bond (Bond No
2753/2017) by Mr and Mrs Maree
in
favour of
Standard Bank be perfected to the maximum amount of R2 000 000
.
00
and the additional sum of R500 000.00 and that the Sheriff be
authorized and directed to attach the listed assets in paragraph
2.4
.
1
to 2.4.5 of the said order, which assets were kept on the Farm Werda.
[8]
In terms of the
rule
nisi
Standard
Bank and its duly appointed agent were granted access to certain
properties of Mr and Mrs Maree to monitor the harvesting
and sale of
maize crops
.
Standard Bank
was also authorized to keep in its possession such movable property
and effects as a pledge and as security for all
amounts due by the
respondents, pending finalization of any application or action to be
instituted by Standard Bank against Mr
and Mrs Maree
.
In terms of
paragraphs 2
.
7
to 2
.
11
of the said order of 30 June 2023, Standard Bank (or its agent) was
authorized
to
monitor the harvesting, delivery and sale of Mr Maree's maize crop,
to attend to the harvesting thereof in the event of Mr Maree
failing
to do so, that the sale and delivery of the maize crop may only be to
an approved third party (with the purpose to ensure
the annotation of
the Standard
Banks'
cession) and to ensure that such third party to which the crop is
sold, pay the proceeds thereof to Standard Bank in settlement
of or
in partial settlement of Mr and Mrs Maree's indebtedness
to Standard Bank
.
[9]
The order so obtained
was executed and the Sheriff took possession of the movable assets of
Mr and Mrs Maree
.
The assets
were not removed from the farms. A collateral manager was appointed
by Standard Bank to guard the assets. Shortly after
the perfection
order was executed Mr Van Wyk of Cloete & Neveling Incorporated,
the attorneys acting on behalf of the respondents
at Harrismith,
contacted Mr Otto of Phatshoane Henney Incorporated, Bloemfontein,
Standard Bank's attorney of record, and requested
an urgent meeting
to take place at the offices of Mr Van Wyk at Harrismith on 5 July
2023
.
[10]
Present at the
meeting were Mr Malan Conradie (as a member of Credit, Standard
Bank), Mr C J Muller (as a member of the Agricultural
Division,
Standard Bank), Mr T Ramdin,
.
Sharmilee
Sitharam, (Manager Business Support and Recoveries
,
Credit
Division, Standard Bank, who is also the deponent to Standard Bank's
founding and replying affidavits), the Collateral Manager
of Standard
Bank and Mr Otto
.
From the respondents'
side
,
Mr
and Mrs Maree and their attorney, Mr Van Wyk were present.
Discussions took place and Mr and Mrs Maree were requested to advance
their proposals as to how the indebtedness to Standard Bank would be
serviced.
[11]
On 11 July 2023 Mr
Van Wyk furnished Mr Otto with written proposals for consideration by
Standard Bank. The proposals made by the
respondents were accepted by
Standard B nk and a settlement agreement (the
"
Settlement
Agreement") was then drafted
_
by
Mr Otto and dispatched to Mr Van Wyk for perusal. Mr and Mrs Maree,
the trustees of the D C Maree Trust and Mr Maree in his capacity
as
the sole member
of
Goldensands signed the Settlement Agreement on 17 July 2023 at
Harrismith
in
the presence
of witnesses
.
The Settlement
Agreement was signed on behalf of Standard Bank on 8 August 2023 at
Durban.
[12]
On 9 August 2023 the
respondents
'
current
attorney, Mr Van den Bout of Arnaud van den Bout Incorporated ("Mr
Van den Bout") became the attorneys of record
in the perfection
application as well as the attorneys of record for Mr and Mrs Maree.
The confirmation
of
the
perfection
application
was
opposed
on
a
number
of
grounds.
However, eventually, on 7
December 2023 Loubser J confirmed the
rule
nisi
with
costs to be paid by Mr and Mrs Maree on the scale as between attorney
and client, such costs to include the costs of two counsel.
On 16 February 2024
the application for leave to appeal by Mr and Mrs Maree was heard by
Loubser J and on 22 February 2024 judgment
was delivered in terms
whereof the application for leave to appeal was dismissed with costs.
[13]
In their answering
affidavit in the perfection application, Mr
and
Mrs Maree
stated that the court process was abused and the
rule
nisi
in
the perfection application was used to force them to enter
.
into
the Settlement Agreement with Standard Bank. The relief sought by
Standard Bank in this matter is the relief contemplated by
Standard
Bank in its replying affidavit in the perfection application. The
action envisaged by Mr and Mrs Maree in their answering
affidavit in
the perfection application pertaining to the alleged duress under
which the Settlement Agreement was signed, has since
been instituted
under case number 2024/15983
in
the Gauteng Division of the High Court, Pretoria.
[14]
The application for
judgment, firstly based upon the Settlement Agreement, does not
include Mr and Mrs Maree in their personal capacities.
Standard Bank
has commenced with sequestration proceedings against Mr and Mrs Maree
in their personal capacities, which application
is opposed and is
pending.
[15]
Standard Bank
contends that the respondents repudiated the Settlement Agreement and
it was indicated in the answering
affidavit to the
perfection application that they do not regard themselves to be bound
by the Settlement Agreement. Whereas the
respondents undertook to
settle the full outstanding balances due to Standard Bank within four
months from date of the last signature
thereof, being 8 August 2023,
the respondents did not comply with the agreement. During the hearing
of this matter Mr Zietsman
SC, counsel on behalf of Standard Bank,
confirmed that no payments were made by the respondents as agreed to
in the Settlement
Agreement.
[16]
The respondents
raised,
inter
alia,
the
following defences;
16.1
The
application
ought
to
•
be
dismissed
insofar
as
it
relates
to
the
relief
.
claimed based
upon the Settlement Agreement, in that Standard Bank was aware that a
material dispute of fact regarding the validity
and enforceability of
the Settlement Agreement existed, which dispute of fact is
incapable
of being
resolved by way of motion proceedings;
16.2
In the event that the
Settlement Agreement
is
found to be valid and enforceable by the court, the relief claimed on
the basis thereof as well as on the basis of the guarantees,
the two
term loans and the order for special executability, is premature;
16.3
The application
in
terms of Rule
46(1)(a)(ii) ought to be declined,
inter
alia, on the
basis that two of Mr and Mrs Maree's sons with their families
reside on two of the
farms, being the farm Toekomst and the farm Werda and one of their
foreman also resides on the farm Werda.
Furthermore, farmworkers and
their families reside on two of the farms and 91 farm workers are
employed in the farming operations.
Should a forced sale of the farms
take place pursuant to an order declaring the farms specially
executable, these employees will
lose their employment with
devastating consequences.
16.4
Because of the
dispute regarding the validity and/or enforceability of the
Settlement
Agreement
the
respondents
issued
an
action
in
the
Gauteng Division of
the High Court, Pretoria whereby the respondents, amongst others,
move for a declaratory order that the Settlement
Agreement be
declared void and/or
unenforceable. The
combined
summons
in the Gauteng
division
was
served upon Standard Bank on 21 February 2024.
THE
APPLICABLE LEGAL PRINCIPLES AND DISCUSSION.
[17]
The issue for
determination is how the Settlement Agreement came about and whether
,
Mr
and Mrs Maree signed the Settlement Agreement as a result of any
duress having been exerted upon them.
I
n
their answering
affidavit the respondents referred to the contents of the opposing
affidavit filed in the perfection application
in an endeavour to
explain the argument that the court process was abused and the
perfection application was used to force a settlement
agreement upon
them
:
According to
Mr
and
Mrs
Maree
the
Settlement
Agreement
was
intended
to
circumvent
due process, to
take away the
court's judicial
oversight
as
well as Mr and
Mrs Maree's right to
a fair process.
[18]
The
respondents
contend
that
the
following
events,
which
gave
rise
to
the
signing
of the Settlement
Agreement, are significant: On 1 July 2023 representatives of HTA
Auctioneers, namely Mr Jan Hugo, Mr Dewald van
den Berg and Mr Japie
Minnaar arrived
at
the Maree residence in Harrismith
and requested Mr
.
Maree to sign
for the receipt of a voluminous pack of documents.
He refused
.
The representatives
of HTA
Auctioneers
then
started to write
up and put a
value on his caravan
and two
motor vehicles.
There after they
requested Mr Maree to accompany
them to the farms to
enable them to list
and put up values on all movable farming equipment.
[19]
Mr Maree accompanied
the said representatives to the farms and for the rest of the day
they listed and appraised all the movable
farming equipment.
The Sheriff was not
present. At the time, Mr and Mrs Maree were unaware of the perfection
application and only became aware of the
rule
nisi
when
same was served and executed on 3 July 2023 by the Sheriff. On 17
July 2023 Mr. and Mrs
.
Maree, in
their
capacities
as trustees of the D C Maree Trust, as well as
in
their personal
capacities, signed the Settlement Agreement.
Reference is made to
paragraph 2.5 to 2.7 of the opposing affidavit in the perfection
application and quoted in the answering affidavit
in the matter at
hand. These paragraphs reads as follows
:
"2.5
We were told to sign
the settlement agreements or cease trading and
we
were
consequently forced to sign, because we have 40 fixed employees,
about 300 temporary employees, several monthly commitments
and
several other considerations that left us with no other option than
to sign their settlement agreements.
2.6
The details of the
duress applied to
induce
the agreements
are detailed below and will be fully ventilated in action proceedings
to
follow
in due course.
2.7
We
could
not merely
cease trading due to the Applicant's impatience."
[20]
Counsel
appearing for the respondents, Mr Van Loggerenberg
SC,
with reliance upon Rule 6(5)(g) and
Wightman
t/a JW Construction v Headfour (Pty) Ltd
[1]
,
submitted
that it
is
impossible
to determine the question whether Mr and
Mrs
Maree signed the Settlement Agreement freely and voluntarily or under
duress on the papers without the parties having an opportunity
to
adduce oral evidence and to cross-examine any witnesses during a
trial.
He
proposed, on that basis, that the matter be referred for trial in
accordance with the relief claimed in a draft order handed
up at the
hearing of the matter.
[21]
Mr Van Loggerenberg
SC argued that the respondents have seriously and unambiguously
addressed the duress under which they signed
the Settlement Agreement
in their answering affidavit for, amongst others, the following
reasons
:
21
.
1
the alleged duress is
clearly not an afterthought or an opportunistic scheme designed by
the respondents in a mala
fide
way;
·
21
.
2
as far back
as 3 August 2023, Mrs
Maree raised their concerns
with
the Banking Ombudsman, recording, specifically, that they did not
have a choice in signing the Settlement Agreement as
.
they could not
continue to harvest because the silos were full. They were harvesting
in a high risk fire area
.
The crop could
be destroyed by fire due to the fact that they were prevented by
Standard Bank from delivering the harvested crop
to AFGRI.
21
.
3
the allegations in
the particulars of claim in the action instituted in the Pretoria
High Court (which are not addressed at all
by Standard Bank) are of a
serious and unambiguous nature.
[22]
The Settlement
Agreement came about after Mr and Mrs Maree were confronted with the
consequences
of
the perfection application sought on 30 June 2023 and the order
granted by Mhlambi J.
.
Mr Van Wyk
,
who evidently
acted on their instructions, approached Mr Otto and requested an
urgent meeting to be held on 5 July 2023. Subsequent
to the meeting,
a further telephonic conversation took place between the two
attorneys where after Mr Otto addressed a letter with
annexures
thereto, dated 10 July 2023, to Mr Van Wyk.
In a letter addressed
by Mr Van Wyk to Mr Otto, dated 11 July 2023, it is stated that after
consultation with his clients, the following
proposal to settle the
debt due to Standard Bank is made
:
"1
.
That our client
proceeds to deliver the maize to Afgri in terms of contact numbers
1.1.
[…] (dated 17
October2022);
1.2.
[…] (dated 17
October2022)
;
1.3.
[…] (dated 1
November 2022); and
1.4.
[…] (dated 1
November 2022)
.
2.
That Afgri be allowed to
retain the amount of ±R11 800 000
.
00.
The current balance
on the Afgri account is ±R13 400 000
.
00
.
Our instructions are
that our client already delivered the maize which covers the
difference between the aforementioned amounts
.
It appea
r
s
that Afgri has not, as yet, delivered said maize due to the session
(sic)
dispute
with your client
;
3.
Afgri will pay the
balance of the proceeds of the contract referred to above, after
collecting the outstanding amount due to them,
directly to The
Standard Bank of South Africa Limited for the credit of our client's
overdraft facility;
4.
Our client pays the
creditors as listed
in
the attached
schedule of creditors.
Writer
confirms that, according to Mr Henk Strydom, Pannar perfected a
session
(sic)
signed by
our client for the amount due to them as shown in the schedule of
creditors.
According
to our instructions, this session
(sic)
was only
signed about two weeks ago and will therefore rank behind The
Standard Bank of South Africa Limited's session(sic) that
was
perfected on the 3
rd
of
July
,
2023.
5.
It is our instruction
that our client intends to cease his farming activity
and sell his farms,
water rights, machinery & equipment and cattle
.
Our instructions are
that the total proceeds will amount to R180 000 000.00.
We attach hereto a
schedule draft by our client showing the value of the farms, water
rights, machinery & equipment and cattle
as calculated by him.
Our instructions are that three interested parties have already made
contact with our client without our
client starting to actively
market the
properties.
Our
client believes that he will be able to sell the farms, water rights,
machinery & equipment and cattle without much difficulty.
Our
client therefore proposes that your client grants our client the
opportunity to market and sell the property within a period
of four
months after they delivered the maze harvested. Should our client not
to be able to market and sell the properties within
the specified
time, The Standard Bank of South Africa Limited will have the right
to market and sell the property on his behalf
in order to settle
their outstanding debt.
6.
The Standard Bank of
South Africa Limited makes it a condition to Afgri that Afgri must
deliver the 2 600 (two thousand, six hundred)
tons of maize before
the end of the month.
Our
client has already harvested 1360 tons (one thousand, three hundred
and sixty) tons of maize which
is
kept at his
storage facility on the farm Toekomst, which amounts to 40 (forty)
loads of 34 (thirty four) tons each, valued at ±R6
256 000
.
00
.
It is imperative that
this maze be dispatched
from
the farm and delivered to Afgri within the next two weeks.
7.
Our client also has
five loads of non-GMO white maize in his storage facility on the farm
Werda. Our client requests that he be
immediately authorized to
deliver this maze in order to free the stories facility on Werna
(sic)
to
stall yellow maize.
Our
client is convinced that his proposal is tantamount
to a working proposal
that will be to the benefit of all parties.
Our client therefore
requests that your client considers his proposal favourably
."
[23]
On 13 July 2023 the
Settlement Agreement, drafted by Mr Otto, was sent to Mr Van Wyk. On
15 July 2023, at the request of Mr and
Mrs Maree, without any
attorneys being present, they held a further meeting with Mr Ramdin
of Standard Bank. On 17 July 2023 Mr
Van Wyk addressed a letter to Mr
Otto and annexed thereto was the Settlement Agreement duly signed by
Mr and Mrs Maree.
Appended
to the replying affidavit filed by Standard Bank, is a copy of a
WhatsApp message from Mr Uys, the
third
trustee of the DC
Maree
Trust, confirming that
,
as far as he
is concerned,
the
D C Maree Trust is satisfied with the contents of the settlement
agreement.
[24]
The following are,
inter alia
the terms
of the Settlement
Agreement:
In
clause 4 thereof, Mr and Mrs Maree, the D C Maree Trust and
Goldensands (the
"parties")
acknowledged
that they are in default in terms of the agreements on the accounts
mentioned in clause 4
.
1
to 4.16
(which
corresponds
with the
mounts
and the account numbers set out in the Notice of Motion apart from a
few accounts in respect of which payments had been made
after
conclusion of the Settlement Agreement). Under the heading "Special
Conditions" it is recorded that Standard Bank
grants permission
that the total crop harvested and to be harvested be delivered to
Afgri in terms of the relevant grain contracts
subject to the
condition that written confirmation from Afgri be provided to
Standard Bank that the debt owed has been paid and
that the surplus
crop income will be paid to Standard Bank
.
[25]
Any proceeds from the
sale of livestock must be credited to the SBSA (presumably Standard
Bank) account in reduction of the exposure.
It was furthermore
agreed that the
rule
nisi
dated
30 June 2023 be confirmed on 3 August 2023 and that the parties are
liable for all taxed attorney and client legal costs.
In the event of the
parties failing to settle the full outstanding balances as stipulated
in clause 4.1 to 4
.
16
.
3
within 4 months from 8 August 2023 or to pay the legal costs within 7
days after the taxed account has been furnished by email
to
them
and to rectify
the default after 7 days written notice, the
full
outstanding balances
together with
interest
thereon as
per
clause 4
.
1
to
4
.
16.3
as well as all
taxed
costs will immediately become due and payable
.
[26]
In the event of
non-compliance with the terms of the Settlement Agreement, Standard
Bank may
immediately
proceed with
the sale of the perfected assets and/or will be entitled to sell the
properties mentioned in clause 6
.
3
and 6.4, being the 5 farms referred to in the Notice of Motion, or
may proceed to obtain judgment against the parties for the
full
outstanding balances and proceed to obtain a warrant of execution.
[27]
In terms of clause 8 of the
Settlement Agreement
it
was agreed
that the Settlement Agreement be made an order of court. A
non-variation agreement is contained in clause
9
and
it
was
agreed,
in
terms
of
clause
7, that
a certificate
signed
by any of Standard
Bank's managers, whose appointment would not be necessary to be
proved as to the indebtedness of the parties,
including interest, the
rate of
.
interest
and the method of calculation of interest, would be
prima facie evidence
of such indebtedness.
[28]
Further advances were
requested by Mr Maree during the period after the signing of the
Settlement Agreement. On 28 July 2023, after
Standard Bank initially
declined to provide any further financial assistance due to a
deviation of the expected crop- income and
the level of the exposure,
agreed to make available "additional operational expenses"
and
to
adjust
the
overdraft
limit
to
make
available
an
amount
of R528 000
.
00
for certain critical expenses namely wages/salaries
.
According to Standard
Bank the further advances were made in an endeavour to assist the
respondents in continuing the farming operations
in the light of the
Settlement Agreement and respondents' undertaking to sell the farms,
cease farming activities and to repay
Standard Bank within four
months from the last date of signature of the Settlement Agreement.
[29]
On 24 July 2023 and
25 July 2023 Mr Maree requested further financial assistance in the
amount of R60 000
.
00
in respect of,
inter
alia,
diesel,
wages for domestic worker(s), groceries, payments on credit cards and
for medical expenses, (alleged to have been caused
by stress). After
Standard Bank declined to provide further financial assistance, Mrs
Maree submitted a complaint with the Banking
Ombudsman on 3 August
2023
.
The
complaint to the Banking Ombudsman refers to the presence of bank
officials on the farm to monitor "everything that go
in and out
of the
farm"
and the
actions of the auctioneer who listed all the movable assets to cover
the notarial bond. It is stated that "
...
we need to
sign a settlement
agreement
before
we court start
delivery
maize
again
to Afgri".
In paragraph
4, the complainant
had to state what the objective of the complaint was. The following
was recorded
:
"Interest
of Afgri
because we were late in paying them.
All the costs for the
people/attorneys
.
Stress and
suffering for all my people working for me and ourselves
.
Defamation of our
names. Interest of SB because we were
late with the
delivery of the maize we
could
not pay them
back."
[30]
On 9 August 2023, Mr Van den
Bout confirmed that he is substituting Mr Van Wyk as the attorneys
appearing on behalf of the
·
respondents
and on 10 August 2023 (the extended return day of the perfection
application) the respondents indicated that they intend
opposing the
perfection application and their counsel indicated that the
respondents are repudiating the Settlement Agreement.
On 18 August
2023, Mr Maree in a further email to Standard Bank requested a
further advance in the amount of R250 000.00
.
Standard Bank
declined any further advances.
[31]
Despite the complaint
lodged with the Banking Ombudsman that he was unfairly treated by
Standard Bank and that he signed the Settlement
Agreement under
duress, Mr Maree made contact with Standard Bank to obtain approval
to sell assets which form part of
Standard Bank's
security under its perfected notarial bond On
6 September 20i3 the
respondents slaughtered 22 lambs
and on 1 October 2023
a further 44 lambs, in order to utilise the proceeds to pay
certain of the
respondents' creditors, employees and/or service providers. This
ocqurred notwithstanding the agreement reached that
any proceeds will
be utilised to credit the Standard Bank account.
The slaughtering of
the livestock was admitted by M
and Mrs Maree.
[32]
On 17 October 2023 a
notice in terms of clause 6 of the Settlement Agreement was
dispatched by Mr Otto to the respondents, more
specifically to the
agreed email address of Mr Maree, referring Mr Maree to the contents
of the Settlement Agreement and the non-compliance
with the terms
thereof. The respondents were requested to rectify the default within
7 days, failure of which, Standard Bank intends
to proceed with the
necessary legal action. The respondents did not reply to the demand.
Thereafter the application for judgment
was issued on the 8
th
of
November 2023.
[33]
Motion
proceedings concern the resolution of legal issues based on common
cause facts. There is an increasing practice to proceed
by way of
motion rather than action proceedings due to the fact that the scope
of the application procedure has been greatly extended
and, secondly,
because an application procedure is less costly and more expeditious
than a trial action. Application procedure
is not appropriate for the
purpose of deciding real and substantial disputes of fact. In
Wightman
t/a JW Construction v Headfour (Pty) Ltd
Heher
JA reiterated that"
...
an
applicant who seeks final relief on motion must, in the event of
conflict, accept the version set up by his opponent unless the
latter's
allegations
are,
in
the opinion
of
the
court,
not
such as
to
raise
a
real,
genuine
or
bona
fide
dispute
of fact or so are so far-fetched or clearly untenable that the court
is justified in rejecting them merely on the papers"
.
[2]
[34]
A
real dispute of fact arises most obviously when the respondent denies
material allegations made by the
applicant
and produces positive evidence to the contrary.
[3]
In
Plascon-Evans
Paints Ltd v Van Riebeeck Paints (Pty) Ltd
[4]
it
was held that in certain instances the denial by a respondent of a
fact alleged by the applicant may not be such as to raise
a real,
genuine or
bona
fide
dispute
of fact and in the event of the court being satisfied as to the
inherent credibility of the applicant's factual averments,
it may
proceed on the basis of the correctness thereof and include this fact
among those upon which it determines whether the applicant
is
entitled to the final relief it seeks
.
[5]
[35]
I have mentioned the
steps taken prior to and subsequent to the meeting that occurred on 5
July 2023 at Harrismith and the period
that culminated into the
drafting and signing of the Settlement Agreement. At no stage did Mr
Maree, Mrs Maree or their attorney
at the time, Mr Van Wyk raise any
concerns or objections against the Settlement Agreement or its
validity or enforcement. Only
once the request for further advances
on the overdraft facility were denied and after the present attorneys
of record for the respondents
came on board, did Mr and Mrs Maree
raise the objections that they had been treated unfairly and signed
the Settlement Agreement
under duress.
[36]
The attorney who
represented the respondents during the settlement negotiations, Mr
Van Wyk, is a senior attorney who has been practising
within this
court's jurisdiction for a considerable period of time. When I take
into consideration the full assistance of Mr and
Mrs
Maree by their former
attorney
and
the exchange
of correspondence,
which I had referred to as well as the time lapse from 5 July 2023 to
13 July 2023, it is difficult to match
the vague and unsubstantiated
allegations in the answering affidavit of duress with the preceding
facts.
Mr
Zietsman SC argued
-
that
the respondents were called upon to grapple with the issue of duress
in their answering affidavit, which they failed to do.
[37]
Mr Van Loggerenberg
SC, counsel on behalf of the respondents, with reference to paragraph
44 of the answering affidavit, argued
that the circumstances
surrounding the conclusion of the Settlement Agreement are fully set
out in the particulars of claim of
the action in tituted in the
Gauteng Division and that it will be fully dealt with by means of
evidence, discovery and cross-examination
in the intended action.
[38]
As is evident from
the dates referred to herein the Settlement Agreement was signed by
Mr and Mrs
·
Maree
approximately 17 days after the hearing of the urgent,
ex
parte
perfection
application
.
I
agree with the argument on behalf of Standard Bank that the issue of
duress ought to have been dealt with fully in the answering
affidavit.
There
is no indication in any of the interactions between the
representatives of Standard Bank and Mr and Mrs Maree, while
represented
by Mr Van Wyk, that undue influence by the officials of
Standard Bank or the attorney(s) was exerted or, in fact, that any
demand
was made by Standard Bank. In fact, the proposal for
settlement came from the respondents and was pursued through their
attorney
who had full and extensive time to consult with Mr and Mrs
Maree and to consider the matter.
[39]
The respondents were
provided with an opportunity to peruse the Settlement Agreement,
obtain legal advice and consider the implications
of the contents
there9f
.
The
result is that the Settlement Agreement was signed by Mr and Mrs
Maree on 17 July 2023, the 4th
day after they had
received the same
.
Loubser J
found as follows pertaining to the conclusion of the Settlement
Agreement:
"[19]
Now
it
is
patently
clear on the papers before me that the proposals which eventual y
culminated in
the
settlement
agreement,
came
from
the
respondents
themselves
and
their
attorney at the time. Those proposals
were
accepted
by the applicant (Standard Bank), and, it
thereafter
drafted
the document
for
signature
by
all
the parties.
The
parties
signed
the
agreement,
and
there
is no evidence before the court that the respondents
signed
the agreement
with
the proverbial barrel against the head.
If
there
was such evidence,
it
would
have
been surprising,
to
say
the
least, in view of the fact that the agreement
consisted
of
terms initially proposed by the respondents
themselves."
[6]
[40]
In
Medscheme
Holdings (Pty) Ltd and another v Bhamjee
[7]
Nugent
JA rejected the idea of economic duress as a basis to escape a
settlement agreement. The facts can concisely
be
summarised
as
follows: Dr Bhamjee claimed from Medscheme,
which
Medscheme alleged were inflated claims, and would then pay back to
his patients the monies received from
Medscheme.
The result was that Medscheme paid him more than what was owed to
him. When confronted with overcharging, Dr Bhamjee
agreed he owed
Medscheme
money
.
He
signed two acknowledgements of debts, the first on 23 June 1998 and
the second on 17 February 2000
,
to
pay back the agreed amounts.
[41]
After Dr Bhamjee
signed the acknowledgements, Medscheme decided it would no longer
accept claims from Dr Bhamjee on behalf of his
clients. Dr Bhamjee
would have to recover his charges directly from his patients (the
members of Medscheme) and thereafter the
members would in turn be
reimbursed by Medscheme to the extent of the prescribed tariffs. This
change resulted in many patients
leaving Dr Bhamjee, and soon
thereafter this culminated
in
his practice to collapse.
[42]
After the collapse of
his medical practice, Dr Bhamjee disputed the validity of the two
acknowledgements of debt, alleging they
were signed under duress. Dr
Bhamjee claimed that the duress was the threat of economic hardship -
as his failure to
sign the acknowledgements would have put his practice at risk. The
Supreme Court of Appeal held that economic
pressure is not recognised
as duress –
"English
and American law both recognise that economic pressure may, in
inappropriate cases, constitute duress that allows
for the avoidance
of a contract.
As
pointed out by Van den
Heever
AJ in
Van
den Berg
&
Kie
Rekenkundige Beampte v Boomprops 1028 BK
1999 (1)
SA
780
(T)
that
principle has yet to be authoritatively accepted in our law
.
While
there
would
seem to
.
be
no principled reason why the threat of economic ruin should not, in
appropriate cases, be
recognised
as duress, such cases are likely to be rare
For
it is not
unlawful,
in general, to cause economic harm
,
or
even to cause economic ruin, to another, nor can it generally be
unconscionable to do so in a competitive economy
.
In
commercial bargaining the exercise of free will (if that can ever
exist in any pure form of the term) is always fettered to some
degree
by the expectation of gain or the fear of loss. I agree with Van den
Heever AJ (in
Van
den Berg
&
Kie
Rekenkundige
Beamptes
at
795E-796A)
that
hard bargaining is not the equivalent of duress, and that is so even
where the bargain is the product of an imbalance in bargaining
power.
Something more -which is
absent
in this case
-
would
need to exist for economic bargaining to be illegitimate or
unconscionable and thus to constitute duress
.
"
[8]
[43]
In
Trident
South Africa (Pty) Ltd and Another v Taylor and Others
[9]
the
court held that the respondent ("Mr Taylor"), who contended
that a settlement agreement was entered into under duress,
relies
upon a legal foundation which has been expressly rejected
[10]
,
riot
only by Van der Westhuizen J in an urgent application brought by Mr
Taylor, but also by the Supreme Court of Appeal in the
Medscheme
v Dr Bhamjee
matter.
Mr Taylor claimed that part of the duress is the emotional state he
was placed in as a result of the litigation and the
implementation of
a settlement agreement which had been made an order of court. Mr
Taylor argued that the order was executed whilst
he was at work,
people pounded on the doors, and drawers and cupboards were emptied.
De Vos AJ held as follows:
"This
contends Mr Taylor shows the presence of "evil", which
Counsel for Mr Taylor submits he needs to prove to show
Mr Taylor was
under duress.
It
cannot be, at
the level of principle and legal policy, that a litigant can escape a
settlement agreement on the basis of duress
if
the
"evil" which
exerted
the
pressure
was litigation itself or the lawful execution of a court
order.
[48]
Litigation is confrontational; it is, however, also part of the
exercise of a right to access courts. It cannot be that being
exposed
to litigation is sufficient for a claim of duress."
[44]
With reference to the matter of
Medscheme and Dr Bhamjee,
De
Vos AJ held as follows:
"The
sting
of
this
finding
is
that
it
is
not
duress
to
cause
economic
harm
or
even
ruin
to another. As it is not unlawful to drive a hard bargain, it cannot
be
the
basis
of duress."
[11]
[45]
It
is trite that an attorney or counsel has the authority to compromise
an action or reach a settlement in any matter unless he
has received
instructions to the contrary.
Our
courts
encourage
parties to deal with their disputes in this way. When concluded, such
a compromise disposes of the proceedings
[12]
.
Mr
Maree (who was born in 1965) and Mrs Maree, it is assumed, have been
farming for a considerable period taking into account the
date of
transfer of the farm Toekomst during 1996 as well as the other farms
(transferred during 2009, 2010
and
2014).
As
is
evident
from the scale of their farming
activities,
which
has
been alluded to in the particulars
of
claim
in
the action
instituted
in the Gauteng Division, it is clear that Mr and Mrs Maree have been
involved in commercial dealings and have concluded
several agreements
with,
inter
alia,
Standard
Bank, Afgri and Pannar (as is evident from the emails appended to the
papers).
[46]
I
agree with the finding by Loubser J that the respondents have entered
into a valid settlement agreement and that they are bound
by the
terms thereof, irrespective of whether the agreement was made an
order of court or not.
[13]
.
Loubser
J already found that the defence (cause of action) relied upon by the
respondents not to be a defence (cause of action)
in the perfection
application. The subsequent application for leave to appeal lodged by
the respondents was dismissed by Loubser
J on 22 February 2024
.
[47]
I
am satisfied that there is no material dispute of fact that is such
as to warrant that the case be referred for trial. It would
be
appropriate, it seems to me, to apply the 'robust common sense
approach' and deal with the matter on the papers.
[14]
I
therefore find that the respondents have not raised a bona fide and
real dispute of fact and that the allegations
are
such that they can be rejected out of hand on the papers.
[48]
A further aspect
raised on behalf of the respondents is the argument that the relief
claimed by Standard Bank is premature in that
there must be a breach
by all the respondents of clause 5 of the Settlement Agreement,
alternatively a default to comply with clause
5 must have occurred by
the respondents, the respondents must have 7 clear days written
notice to rectify the breach/default and
the respondents
must fail to rectify
the breach/default "after" the 7 days written notice. It is
furthermore argued that the notice which
was sent per email to Mr
Maree on 17 October 2023, was not addressed to Mr and Mrs Maree in
their personal capacities as parties
to the settlement agreement.
Furthermore, that the contents thereof are vague and the notice did
not stipulate the respects in
which the parties to whom it was
addressed failed to comply with the terms and conditions of the
Settlement Agreement.
[49]
On behalf of the
respondents it is contended that the full outstanding balances
together with interest thereon as per the Settlement
agreement were,
on Standard Bank's own version, not yet due and
payable when it
brought the application.
It
is thus argued that having regard to the prematurity the application
should be dismissed. The basis of the respondents' contention
,
if understood
correctly, is that in terms of the Settlement Agreement the time for
performance is a period of 4 months from the
last date of signature
by Standard Bank, thus before 8 December 2023. The application was
issued on 8 November 2023.
[50]
However, by 3 August
2023 the respondents indicated their intention to oppose the return
date of the perfection application on 10
August 2023.
On the same date, Mrs
Maree submitted the complaint to the Banking Ombudsman as more fully
dealt with herein above
.
.
The newly appointed
attorneys on behalf of Mr and Mrs Maree filed a notice of
substitution as attorneys of record on 9 August 2023,
where after the
opposing affidavits in the perfection application was filed on 23
August 2023.
On-
6 September 2023
the
first of several lambs were slaughtered
in contravention
of the terms of the
Settlement Agreement.
[51]
Repudiation
is primarily a question of the intention of the party alleged to have
repudiated an agreement. The respondents did not
attempt to comply
with the terms of the Settlement Agreement subsequent to the notice
issued by Mr Otto. Repudiation therefore
took place before the date
on which performance was due and thus constitutes an anticipatory
breach upon which Standard Bank may
take action if it so elects.
[15]
I
agree that the application was not issued prematurely and the defence
in this regard cannot be sustained
.
[52]
Apart from the
monetary judgment, Standard Bank s eks an order declaring the farms,
over which mortgage bonds are registered in
its favour, specifically
executable, together with ancillary relief. The respondents oppose
the relief claimed and contend that
the farms are occupied by family
members and minor children of Mr and Mrs Maree and by farmworkers.
[53]
Rule 46A(1) applies
"whenever an execution creditor seeks to execute against the
residential
immovable
property of a
judgment debtor".
Rule
46A(2) provides
-
that
a court considering "an application under this rule" -
that is, an
application in which a creditor seeks to execute against the judgment
debtor's immovable property -
must consider various
matters.
Rule
46A(3) (9) are framed with reference to an application
brought
by a creditor seeking leave to execute against the judgment debtor's
immovable property.
[54]
On
behalf of Standard Bank it was contended that the provision of Rule
46A do not find application on the basis that the farms are
registered in the name of the DC Maree Trust and/or Goldensands
.
It
is common cause that the subject farms are used as the primary
residence of Mr and Mrs Maree's sons and their families
as
well as by numerous farm employees. The argument that the provisions
of Rule 46A do not apply to residential property registered
in the
name of a trust or a legal entity has been the subject of litigation.
In
Bestbier
and Others v Nedbank Limited
[16]
the
Supreme court of Appeal held that:
"
.
..
due
regard must be had to the impact that the sale in execution is likely
to have on vulnerable
and
poor
beneficiaries who are occupying the
i
mmovable
property owned by the judgment debtor, who are
at
risk
of
losing
their only homes
"
[17]
[55]
Accordingly
and in
light
of the subsequent
finding
by the Constitutional Court in
Bestbier
and Others v Nedbank Limited,
[18]
that
"any other party" that may be affected by the sale in
execution of immovable
property
registered in the name of the D C Maree Trust or Goldensands includes
the family members of Mr and Mr Maree and their employees
who reside
on any of the farms, I am of the view that the issue of the specially
executablity
of
the said farms be addressed at a later stage
.
[56]
As to costs, I see no
reason to depart from the general rule that costs should follow the
result.
[57]
ORDER:
1.
Judgment is granted
against the First to Third Respondents
in
their
capacities as trustees of the D C Maree Trust, IT 1195/95 and the
Fourth Respondent
,
jointly and
severally, the one to pay the others to be absolved, in terms of a
Settlement Agreement, annexure
"B"
dated 8 August
2023 for the following amounts:
1.1
In respect of account
number […]the amount of R31,380
.
852.56
together with interest at Applicants prevailing prime rate as
determined
from
time to time, which rate is currently
11.75% per annum
plus1
.95%
calculated on
the first R30 000,000.00 and thereafter at Applicant's prevailing
rate as determined from time to time, which rate
is currently 11.75%
per annum plus 4.45% calculated on the remaining balance thereafter
from the 25th
August
2023 to date of payment both days inclusive;
1.2
On
account
number […],
the
amount
of
R
325,207.99 together
with interest thereon at the prime rate calculated from 18 September
2023 to date of
payment, both days inclusive;
1.3
On account number
[…], the amount of R189,213.70 plus interest thereon at the
prime rate per annum calculated from 18 September
2023 to date of
payment, both days inclusive;
1.4
On account number[…]
the amount of R189,213.70 plus interest thereon at prime rate per
annum calculated from 18 September
2023 to date of payment, both days
inclusive;
1.5
On account number […]
the amount of R681,898.36 plus interest thereon at the prime rate per
annum calculated from 18 September
2023 to date of payment, both days
inclusive;
1.6
On account number […]
the amount of R239,594.41 plus interest thereon at the prime rate per
annum calculated from 18 September
2023 to date of payment, both days
inclusive;
1.7
On account number […]
the amount of R239,594.41 plus interest thereon at the prime rate
plus 0.7% per annum calculated from
18 September 2023 to date of
payment, both days inclusive;
1.8
On account number […]
the amount of R249,2885.91 plus interest thereon at the prime rate
per annum calculated from 18 September
2023 to date of payment, both
days inclusive;
1.9
On account number […]
the amount of R1, 134,186.02 plus interest thereon at the
.
prime rate per
annum calculated from 18 September 2023 to date of payment, both days
inclusive;
1.10
On account number […]
the amount of R3, 742,954.61 plus interest thereon at the prime rate
per annum calculated from 18 September
2023 to date of payment, both
days inclusive;
.
1.11
On account number […]
the amount of R2, 207,900.08 plus interest thereon at• the prime
rate per annum calculated from
18 September 2023 to date of payment,
both days inclusive;
1.12
On account number […]
the amount of R983,340.54 plus interest thereon at the prime rate per
annum calculated from 18 September
2023 to date of payment, both days
inclusive;
1.13
On account number […]
the amount of R672,952.00 plus interest thereon at the prime rate per
annum calculated from 18 September
2023 to date of payment, both days
inclusive;
1.14
On account number […]
the amount of R5, 208,902.21 plus interest thereon at the prime rate
per annum calculated from 18 September
2023 to date of payment, both
days inclusive;
1.15
On account number […]
the amount of R400,000.00 plus interest thereon at
the
Applicant's
prevailing prime rate
which
is
currently
11.75%
per
annum
calculated
on
the
aforesaid
R400 000.00
from
25
August 2023 to date
of payment, both days inclusive;
1.16
On account number […]
the amount of R7 000,000.00 plus interest at the Applicant's
prevailing prime rate which is currently
11
.
75%
per annum
1.3%
calculated
on
the first R7,000
.
000
.
00
as from the 25
th
of
August 2023 to date of payment, both days
inclusive;
2.
The counter
application by the respondents
is
dismissed with
costs
.
I
VAN RHYN
JUDGE
OF THE HIGH COURT,
FREE
STATE DIVISION
,
BLOEMFONTEIN
On
behalf of the
Applicant:
ADV. P ZIETSMAN SC
Instructed
by
:
PHATSHOANE HENNEY INC
BLOEMFONTEIN
On
behalf of the
Respondent:
ADV. D VAN LOGGERENBERG SC
ADV
N MULLER
Instructed
by
:
BLIGNAUT ATTORNEYS
BLOEMFONTEIN
[1]
[2008] ZASCA 6
;
2008
(3) SA 371
(SCA) at
[12]
and [13].
[2]
[2008] ZASCA 6
;
2008
(3) SA 371
(SCA) at
[12]
.
[3]
Room
Hire Co (Ply) Ltd v Jeppe Street Mansions (Ply) Ltd
1949 (3) SA 115
at 1165-1166; Tamarillo (Pty) Ltd v B N Aitken (Pty) Ltd
1982 (1) SA
398
(A) at 431A.
[4]
1984
(3) Sa 623 (A).
[5]
Plascon-Evans
Paints Ltd v Van Riebeeck Paints (Ply) Ltd (supra) at 634H-635B.
[6]
Standard
Bank of south Africa Limited v Maree and Another (3372/2023)
(2023)
ZAFSHC 241
(7 December 2023).
[7]
2005
(5) SA 339 (SCA).
[8]
Id at
para 18
[9]
(B2149/23)
[2024] ZAGPHC 122
(6 February 2024).
[10]
At
[46].
[11]
Trident
(Supra) at [36].
[12]
Hlobo
v Multilateral Motor Vehicle Accident Fund
2001 (2) SA 59
(SCA) at
[10].
[13]
Standard
Bank of South Africa Limited v Maree and Another (3372/2023)
[2023]
ZAFSHC 241
97 December 2023) at [23].
[14]
Soffiantini
v Mould
1956 (4) SA 150
(E) at 154G - H
[15]
Tuckers
Land and Development Corporation (Pty) Ltd v Hovis
1980 (1) SA 645
(A) at 652G
[16]
(Case
No 150/2021) ZASCA 88 (13 June 2022).
[17]
Bestbier(Supra)
at [27].
[18]
(CCT
181/22) [2024) ZACC 2 (12 April 2024)