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[2024] ZANCHC 11
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Smith N.O and Others v Van Der Ryst (1316/2023) [2024] ZANCHC 11 (9 February 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
(NORTHERN CAPE
DIVISION, KIMBERLEY)
CASE
NUMBER:
1316/2023
DATE
HEARD:
13 October 2023
DATE
DELIVERED:
9 February 2024
Reportable:
YES / NO
Circulate to Judges: YES
/ NO
Circulate to Regional
Magistrates:
YES / NO
Circulate to
Magistrates: YES / NO
In
the matter between:
ELRICH
RUWAYNE SMITH
N.O.
1
ST
APPLICANT
ELNA
ELSA POHL
N.O.
2
ND
APPLICANT
LIZANNE
CHANTAL MULLER N.O.
3
RD
APPLICANT
(In
their capacities as trustees of the
Insolvent Estate
Jacobus
Coenraad Van Der Ryst
, Master Reference
K21/2021)
and
JACOBUS
COENRAAD VAN DER RYST
RESPONDENT
(Identity
Number: 6[...])
In
re:
In
the application of:
JACOBUS
COENRAAD VAN DER
RYST
APPLICANT
and
THE
MASTER OF THE HIGH COURT, NORTHERN CAPE
1
ST
RESPONDENT
DIVISION
THE
STANDARD BANK OF SOUTH AFRICA LTD
2
ND
RESPONDENT
NATIONAL
CREDIT
REGULATOR
3
RD
RESPONDENT
ELRICH
RUWAYNE SMITH
N.O.
4
TH
RESPONDENT
ELNA
ELSA POHL
N.O.
5
TH
RESPONDENT
LIZANNE
CHANTAL MULLER
N.O.
6
TH
RESPONDENT
NATIONAL
CONSUMER TRIBUNAL
7
TH
RESPONDENT
JUDGMENT
Olivier
AJ
INTRODUCTION
:
1.
The 1
st
to 3
rd
Applicants (herein after jointly
referred to as “
the Trustees
”) lodged a
semi-urgent interlocutory application on 15 September 2023 in terms
whereof the Trustees moved for an order in
essentially the following
terms:
1.1
That the Respondent (herein after referred to as “
Van Der
Ryst
”) would have to furnish security to the satisfaction
of the Trustees in the amount of R 250 000,00 (Two Hundred and Fifty
Thousand Rand) for the costs of the Trustees in their opposition of
the Main Application under the above case number; and
1.2
That the Trustees would be granted leave to approach this Court, on
the
same papers duly supplemented, for an order dismissing the
afore-said Main Application, in the event of Van Der Ryst failing to
furnish the security mentioned above within 10 (ten) days from date
of this order.
2.
The Trustees also moved for an order to the effect that Van Der Ryst
was to pay
the costs of this application to which I will henceforth
refer as “
the Security Application
”).
BACKGROUND
:
3.
It is common cause and should be mentioned that the Main Application
referred
to herein above, is an application brought by Van Der Ryst
against
inter alia
the Trustees in terms whereof Van Der Ryst
approaches the Court for an order:
3.1
For the review and possible setting aside of the decision of the
Master
of the Northern Cape High Court (the 1
st
Respondent
in the Main Application and herein after, where and if necessary
referred to simply as “
the Master
”) to admit
certain claims submitted to proof by the Standard Bank of South
Africa (the 2
nd
Respondent in the Main Application and
herein after where and if necessary referred to simply as “
the
Bank
”) at the first meeting of creditors in the insolvent
estate of Van Der Ryst;
3.2
For the referral of the matter to the National Consumer Tribunal (the
5
th
Respondent in the Main Application and herein after referred to where
and if necessary simply as “the NCT”) for consideration
and determination in terms of
Section
136
read with
Section
137
of the National Credit Act
[1]
(herein after “
the
NCA
”),
alternatively referring the matter directly to a Debt Counsellor in
terms of the provisions of
Section
85(a)
of the NCA;
alternatively
3.2.1
Directing the Trustees to examine the claims submitted by the Bank
and to
report to the Master and to Van Der Ryst as envisaged in
Section
45
of the Insolvency Act
[2]
(“
the
Insolvency Act
”);
and
3.2.2
Directing the Master to submit the Bank to interrogation in terms of
the provisions
of
Section 44(7)
of the Insolvency Act.
4.
I was informed by the representatives of both parties to the Security
Application
that the Main Application is still pending and,
importantly for purposes hereof, is not yet ripe for hearing,
alternatively has
not been enrolled for argument and hearing as of
yet.
5.
In his Answering Affidavit in this Security Application, Van Der Ryst
raised
the issue of urgency as a point
in limine
averring that
the Security Application was not urgent as any urgency that might
have existed, was self-created and I was consequently
required to
hear argument on the issue of urgency and to determine the said point
in limine
before dealing with the merits of the Security
Application.
AD
URGENCY
:
6.
It is common cause and warrants very little discussion that it is
expected of
any Applicant to make out a case for the relief sought by
such Applicant in such Applicant’s Founding Affidavit.
[3]
7.
The above holds equally true in the case of applications brought on
an urgent
basis where the Uniform Rules of Court (herein after only
referred to as “
the
Rules
”)
provide that in every application brought on an urgent basis, an
Applicant, in his/her Founding Affidavit “…
must
set forth explicitly the circumstances which is averred render the
matter urgent and the reasons why the applicant claims that
applicant
could not be afforded substantial redress at a hearing in due
course.
”
[4]
8.
Mr. Zietsman SC who appeared on behalf of the Trustees in the
Security Application
impressed on this Court that the Security
Application was brought on a semi-urgent basis only.
I hold the view however
that even semi-urgent applications should still be measured against
the requirements of the above
Rule 6(12)
of the Rules
and that an Applicant in a semi-urgent application is still expected
to make out a case for urgency and to indicate
why he/she will not be
able to obtain substantial redress in due course.
9.
In their Founding Affidavit, the Trustees set out the grounds for
urgency in
paragraph 7 of said Founding Affidavit and avers as
follows:
“
7.1
This application is urgent in the sense that the Applicant
[5]
should be ordered to put up security as soon as possible. The
Applicants have already disbursed the fees of an attorney and counsel
to consult and to prepare opposing affidavits and annexures in the
main application, and will in due course have further disbursements
in the opposing of the main application.
7.2
… the Honourable Court would note that the Applicants ask the
Honourable Court for
the necessary condonation to deviate from the
normal Rules relating to timeframes for the filing of opposing and
replying affidavits.
7.3
The reason being that if the Applicants followed the Rule 6(11) route
in the normal course,
the Respondent might as well a day or two
before the application is heard in the Motion Court, file a notice of
opposition and
apply for the matter to be postponed in order for him
to file the necessary opposing affidavits.
7.4
If an eventual allocation is made to the opposed roll, well knowing
how full the rolls are
in the Kimberley High Court, another 6-8
months will have to be awaited for a hearing date of only the
security application.
7.5
This will cause the application to set security to become an academic
exercise, especially
if the Applicant (Respondent herein)
[6]
is not able to put up security in the process.
”
(My
omissions)
10.
It is clear (in my view) that the Trustees, based on the contents of
their Founding Affidavit,
rely primarily on the period of time that
it would take for the Security Application to be enrolled, argued and
determined as grounds
for bringing this Security Application on an
urgent or at least on a semi-urgent basis.
11.
In as far as the above-stated paragraphs 7.3 and 7.4 of the Trustees’
Founding Affidavit
is concerned, it is common cause that the Security
Application had been opposed by Van Der Ryst and also that Answering
and Replying
Affidavits had been filed.
The parties were also
ad
idem
that the Security Application was ripe for argument and
determination.
The Trustees’
argument in this regard and as set out in the afore-said paragraphs
7.3 and 7.4 of the Founding Affidavit, in
my view, has therefore
become moot.
12.
It is common cause and also appears clearly from the papers in the
Security Application
that the application itself was brought on 10
October 2023.
13.
The salient background events leading up to the lodging of the
Security Application as it
appears from the papers at hand, are as
follows:
13.1
The Main Application was issued on 19 July 2023;
13.2
The Main Application was served on the 1
st
and 2
nd
Applicants in the Security Application by Sheriff on 26 July 2023 and
on the 3
rd
Applicant (also by Sheriff) on 21 August 2023;
13.3
The Trustees required Van Der Ryst to furnish the security as prayed
for in the Security
Application by way of a notice in terms of
Rule
47(1)
of the Rules dated 22 August 2023 (herein after
referred to as “
the Security Notice
”);
13.4
The Security Notice was served on the Attorneys for Van Der Ryst on
22 August 2023 and
in terms of said Security Notice, Van Der Ryst was
afforded 10 (ten) days within which to either provide the necessary
security
alternatively to indicate whether he refuses to provide the
security demanded or whether he contests his liability to provide
said
security;
13.5
The afore-said 10(ten) day period lapsed on 5 September 2023;
13.6
On 5 September 2023 Van Der Ryst filed and served a notice in terms
of
Rule 47(3)
of the Rules in terms whereof he
effectively contested his liability to provide security as requested;
and
13.7
The Trustees’ Answering Affidavit in the Main Application was
filed on 4 September
2023 already.
[7]
14.
Rule 47(1)
of the Rules provides as follows:
“
A
party … shall,
as soon as
practicable after the commencement of proceedings
,
deliver a notice setting forth the grounds upon which such security
is claimed …
” (My
underlining and omissions)
15.
In this instance the Trustees delivered their notice in terms of
Rule
47(1)
almost a month after the Main Application was served on
the 1
st
and 2
nd
Applicants in this Security
Application which prompted me to pose the question to Mr. Zietsman
whether one can really say that
the Security Notice was delivered as
soon as practicable after the institution of the Main Application.
16.
The argument of Mr. Zietsman in respect of the above question may be
summarized as follows:
16.1
That the phrase “
as soon as practicable
” as it
appears in
Rule 47(1)
does not refer to a specific time
frame and that a decision as to what would qualify as “
as
soon as practicable
” would depend on the circumstances;
16.2
That the Trustees could only decide on whether security should be
demanded from Van Der
Ryst after receipt of and consideration of the
Main Application;
16.3
That the Trustees are expected to and should act together in dealing
with and deciding
on matters such as this;
16.4
That the question as to whether security should be demanded from Van
Der Ryst could therefore
only be considered after service of the Main
Application on the 3
RD
Applicant (in this Security
Application) on 21 August 2023;
16.5
That the Security Notice in terms of
Rule 47(1)
was
therefore served as soon as practicable after the commencement of the
Main Application seeing that same was served on 22 August
2023; and
16.6
That the Security Application is an interlocutory application in
another pending application
as opposed to a pending action, which
means that the Security Application might very well be heard
simultaneously with or even
after the Main Application, if
brought in due course, which would negate the Security Application
altogether.
17.
I have already set out my thoughts in respect of the last-mentioned
argument by Mr. Zietsman
and for the reasons set out above, this
argument in my view does not hold water.
18.
Further to the above and although I fully accept the arguments of Mr.
Zietsman in respect
of paragraphs 16.2 and 16.3 herein above, I can
unfortunately not accept his arguments summarized in paragraphs 16.4
and 16.5 above.
For the simple reason
that the appointed Trustees are expected to act jointly in respect of
any matter pertaining to the estate
of Van Der Ryst, one can
reasonably accept, on the probabilities, that the Trustees would have
and more importantly should have
had contact with one another after
service of the Main Application on the 1
st
and 2
nd
Applicants during July 2023.
I therefore have to agree
in this regard with Mr. Visser who appeared on behalf of Van Der Ryst
and it should also be mentioned
that Mr. Zietsman, to his credit, did
remark during his argument in reply, that the Trustees might have
been responsible for some
self-created urgency in this regard.
19.
Further to the above and as was already pointed out, an Applicant in
an urgent application
should show that if the application is not
heard on an urgent basis, he/she would not be afforded
substantial
redress
at a hearing in due course.
20.
It was held in the matter of
East
Rock Trading 7 (Pty) Ltd & Another v Eagle Valley Granite (Pty)
Ltd & Others
[8]
:
“…
the
procedure set out in rule 6(12) is not there for the taking. An
applicant has to set forth explicitly the circumstances which
he
avers render the matter urgent.
More
importantly, the applicant must state the reasons why he claims that
he cannot be afforded substantial redress at a hearing
in due course.
The question of whether a matter is sufficiently urgent … is
underpinned by the issue of absence of substantial
redress in an
application in due course
.
The Rules allow the court to come to the assistance of a litigant
because if the latter were to wait for the normal course laid
down by
the Rules it will not obtain substantial redress.
”
[9]
(My omissions and underlining)
21.
In view again of the fact that the Main Application is still not ripe
for hearing and, more
importantly, have not been enrolled as of yet,
I hold the view that the Trustees can hardly argue with conviction
that they could
not have been afforded substantial redress in a
hearing in due course of the Security Application.
22.
For the above reasons I hold the view that the Security Application
is not urgent and that
same should in fact be struck from the roll.
It should be mentioned
that Mr. Visser on behalf of Van Der Ryst, attempted to raise further
issues
in limine
which was not referred to in the Answering
Affidavit of Van Der Ryst the most important of which was that Van
Der Ryst was prejudiced
in the sense that a Certificate of Urgency
was filed belatedly and together with the Replying Affidavit;
I do not deem it
necessary to deal with this issue in any sort of detail since the
fact that such a certificate was filed after
the fact, and
specifically in view of what has been stated herein above, does not
take the matter in respect of urgency any further.
23.
I do however take the view, for the reasons set out below, that the
Security Application,
despite not being urgent, should in this
instance not be removed from the roll simply due to a lack of
urgency.
24.
It has been confirmed recently that depending on the facts of each
case, circumstances might
exist where, notwithstanding material
non-compliance with the Rules, a matter should be entertained where
it would be in the interest
of expediency.
[10]
In the
matter of
Windsor
Hotel (Pty) Ltd v New Windsor Properties (Pty) Ltd & Others
[11]
it was held by Brooks AJ
[12]
:
“…
I
am of the respectful view that the very practical considerations of
factors such as the incurring of unnecessarily duplicated
case
preparation and presentation procedures, with their concomitant
increase in already substantial legal costs, and the undesirable
duplication of the requirement of the attention and preparation of
more than one court … must be weighed against any apparent
prejudice to a respondent who has been brought to court on a
truncated timeframe.
”
25.
In the present matter both parties have had the opportunity to file
the necessary affidavits
in the Security Application and both parties
have also had the opportunity to file Heads of Argument in the
matter, to properly
prepare and to argue the matter properly.
The merits of the matter
was furthermore also fully argued by both parties’
representatives and I consequently deem it unnecessary
to burden
another Court with this Security Application in circumstances where
practical considerations dictate that the matter
be dispensed with at
this point in time.
Mr. Visser did not take
the point that Van Der Ryst was prejudiced by the truncated time
periods set by the Trustees in the Security
Application and he (Mr.
Visser) certainly did not put up a vigorous argument when asked
whether a determination of the Security
Application at this point in
time, would in any way be problematic.
26.
I consequently hold the respectful view that it is in the interest of
expediency for this
Security Application to be dispensed with at this
stage.
AD
MERITS
:
27.
It is common cause that Van Der Ryst had been declared insolvent by
this Court on or about
15 July 2022 and that the position in respect
of his insolvency had not changed since then.
28.
The mere fact however that Van Der Ryst is an insolvent, does not
entitle the Trustees to
an order that Van Der Ryst should set
security as it has been held that an order as to the provision of
security will, in such
circumstances, only be granted if the Main
Application was found to be reckless and vexatious.
[13]
The
above principle was actually established quite some time ago already
where the Supreme Court of Appeal, in the matter of
Ecker
v Dean
[14]
confirmed same and added “…
that
every application for security must be decided on the merits of the
particular case before the Court, bearing in mind that
the basis of
granting an order for security is that the action is reckless and
vexatious.
”
[15]
29.
Further to the above and in the same matter, the Court confirmed that
the Court has an inherent
discretion to order that security be
provided in order to prevent the abuse of its own processes, but that
this discretion should
be “…
sparingly
exercised and only in very exceptional cases.
”
[16]
30.
It is common cause and also stating the obvious that one of the ways
in which to prevent
the abuse of Court process, is to order that
security for costs be provided and thereby effectively stay the
proceedings up and
until such time that security is indeed
provided.
[17]
It has also been held,
with reference to the afore-said discretion of the Court to stay its
proceedings in order to prevent the
abuse of process that:
“
Proceedings
will be stayed when they are vexatious or frivolous or when their
continuance, on all the circumstances of the case,
is, or may prove
to be, an injustice or serious embarrassment to one or other of the
parties…
”
[18]
31.
The terms “
vexatious
”
and “
abuse
”
in the legal sense, have been defined as “
frivolous,
improper: instituted without sufficient ground, to serve solely as an
annoyance to the defendant … Vexatious proceedings
would also
no doubt include proceedings which, although properly instituted, are
continued with the sole purpose of causing annoyance
to the
defendant; ‘abuse’ connotes a misuse, an improper use, a
use mala fide, a use for an ulterior motive.
”
[19]
It
has also been held that a matter will be deemed to be vexatious and
an abuse of Court processes “…
if
it is obviously unsustainable.
”
[20]
31.
In
Beinash
v Wixley
[21]
it was held that the question as to whether proceedings constitute an
abuse of the processes of the Court, needs to be answered
by taking
cognizance of the circumstances of each case as “
There
can be no all-encompassing definition of the concept…
”
[22]
32.
In this specific matter, Mr. Zietsman argued on behalf of the
Trustees that the Main Application
in effect constitutes an abuse of
the Court process as it boils down to a vexatious application.
In an attempt to avoid
clouding the issues unnecessarily, I will however start off by
referring to the reasons advanced by Mr. Visser
on behalf of Van Der
Ryst as to why the Security Application should fail and more
specifically why the Main Application is not
vexatious and does not
constitute an abuse of process.
33.
Mr. Visser relied heavily on the provisions of specifically
Section
151
of the Insolvency Act which states that “…
any
person aggrieved by any decision, ruling, order or taxation of the
Master or by a decision, ruling or order of an officer presiding
at a
meeting of creditors may bring it under review by the court…
”
34.
Mr. Visser’s primary argument, if I understood him correctly,
was that the Main Application
and specifically the relief sought in
terms thereof, cannot be viewed as being vexatious and/or an abuse of
the Court processes
because
Section 151
, in its effect,
affords the right to Van Der Ryst to approach the Court for a review
of the conduct of the Bank during the first
meeting of creditors in
his insolvent estate.
It appears that Van Der
Ryst’s argument as to why the events during the first meeting
of creditors stand to be reviewed, is
based primarily on the fact
that he (Van Der Ryst) did not receive notice of said meeting.
The further relief sought
by Van Der Ryst is already set out in paragraphs 3.2.1 and 3.2.2
herein above and will not be repeated.
35.
It is however evident from the way in which the relief sought in
terms of the Notice of
Motion in the Main Application is
worded/structured, that what Van Der Ryst in effect wants from the
Court after hearing argument
in the Main Application, is an order in
terms whereof “
the matter
” is reconsidered by
either the NCT, or by a Debt Counsellor (in terms of the NCA) or by
the Trustees (in terms of the Insolvency
Act).
Although it is not clear
precisely what is meant with the term “
the matter
”
as it appears in prayer 2 of the Notice of Motion in the Main
Application, it is my view that the logical inference that
might be
drawn in this instance, is that reference is being made to Van Der
Ryst’s financial situation prior to his final
liquidation.
36.
Mr. Visser argued that the NCA might find application in this
instance by virtue of the
fact “…
that
there exists a harmonious inter-play and relation between the
provisions of the National Credit Act (NCA) and the Insolvency
Act.
”
[23]
37.
In answer to Mr. Visser’s argument in respect of Van Der Ryst’s
right to have
brought the Main Application in terms of
Section
151
of the Insolvency Act, Mr. Zietsman admitted that the
said
Section 151
does indeed afford such a right to Van
Der Ryst, but submitted that an application for review in terms of
Section 151
, should still be based on proper grounds.
38.
I have to agree with the above submission made by Mr. Zietsman as I
cannot believe that
the Legislature, by enacting
Section 151
of the Insolvency Act, intended that such a review may be brought on
improper and/or unsustainable grounds and that a Court will
be
obligated to simply hear such improper and/or unsustainable matter.
If I may therefore add to
the argument of Mr. Zietsman, I would say that the grounds upon which
a review is brought in terms of
Section 151
of the
Insolvency Act should also be sustainable and I do so with reference
to the above matter of
African Farms & Townships Ltd
.
39.
Mr. Zietsman then proceeded to point out that Van Der Ryst’s
primary ground for why
he wants the conduct of the Bank reviewed, is
the allegation that he was not present during the above-mentioned
first meeting of
creditors in his insolvent estate.
If regards are to be had
to the contents of Van Der Ryst’s Answering Affidavit (herein
after “
the Answering Affidavit
”) in the Security
Application, this contention by Mr. Zietsman SC appears to be
correct.
Van Der Ryst states in
paragraph 13.4 of the Answering Affidavit as follows:
“
Inasmuch
as the applicants are implying that the main application was launched
with some ulterior purpose, which suggestion is without
merit and is
also denied.
”
In paragraph 13.5 of the
Answering Affdavit, Van Der Ryst states:
“
The
main application is to facilitate the pursuit of the veracity of the
claims lodged by Standard Bank.
”
In paragraph 15.1 of the
Answering Affidavit it is repeated that the Main Application was not
lodged for an ulterior purpose and
it is stated:
“
The
main application has merit and is not vexatious.
”
In paragraphs 16.1 and
16.2 of the Answering Affidavit, Van Der Ryst intimates that he did
not receive the notice of the first meeting
of creditors and in
paragraph 17.1 he states:
“
I
have already indicated that I did not receive any notification of the
first meeting of creditors and also indicated the reasons
therefore.
”
40.
If regards are to be had to the notice of the first meeting of
creditors, it appears that
a copy of said notice was sent to Van Der
Ryst at the Farm Allendale, Barkly West.
It is this notice that
Van Der Ryst denies receipt of, stating in paragraph 16.2 of the
Answering Affidavit as follows:
“
There
is no postal delivery at this address and the letter would never have
reached me.
”
41.
Mr. Zietsman argued that it was not necessary for Van Der Ryst to be
present at the first
meeting of creditors and amplified his argument
by referring to
inter alia
Section 44(7)
and
Section 45
of the Insolvency Act which provides for a
mechanism whereby the Master may interrogate any person present at a
meeting of creditors
who wishes to prove or has proven its claim
against the estate as well as a mechanism whereby the trustees of an
insolvent estate
is obliged to “
review
” any and
all claims proved during meetings of creditors.
42.
Although Mr. Zietsman is correct in his contentions about the
procedures as set out in the
above
Section 44(7)
and
Section 45
of the Insolvency Act, I can unfortunately
not agree with his contention that the presence of Van Der Ryst at
the first meeting
of creditors was not necessary.
43.
Section 64(1)
of the Insolvency Act states as follows:
“
An
insolvent
shall attend the first
and second meetings of the creditors
of his estate …
unless he
has previously obtained the written permission of the officer who is
to preside or who presides at such meeting granted
after consultation
with the trustee to absent himself. The insolvent shall also attend
any subsequent meeting of creditors if required
so to do by written
notice of the trustee of his estate
.
”
(My underlining and omissions)
I understand the above
extract from
Section 64(1)
of the Insolvency Act to
mean exactly what it says namely that an insolvent is obligated to
attend the first and second meetings
of creditors unless excused (in
this case) by the Master after consultation with the Trustees.
The above is underlined,
in my view, by the provisions of
Section 66
of the
Insolvency Act which provides therefore that an insolvent may
effectively be imprisoned if he/she fails to attend the first
and
second meetings of creditors.
44.
In view of the above therefore, I hold the respectful view that Van
Der Ryst had the obligation
to attend the first meeting of creditors
which forms the subject of the Main Application and that this
obligation was an absolute
one.
[24]
45.
It does not appear from the papers that Van Der Ryst was given notice
of the said first
meeting of creditors in any other way than by way
of notice in the Government Gazette and by way of the notice to Van
Der Ryst
referred to in paragraph 40 above.
It was certainly not
argued to the contrary by any of the parties’ legal
representatives.
46.
The question that now arises is whether the above notice of the first
meeting of creditors
was sufficient or whether the Master had some or
other obligation to ensure that Van Der Ryst’s attendance at
the first meeting
of creditors was ensured.
47.
Section
40(1)
of the Insolvency Act only requires notification of a first meeting
of creditors by way of a publication in the Government Gazette
as
opposed to publication also in a local newspaper (in the district
within which the insolvent resides) of a second meeting of
creditors.
[25]
In the
matter of
R
v Mahomed Abbass
[26]
the Court held that notice by way of a publication in the Government
Gazette was sufficient.
[27]
The
above was also confirmed in the matter of
R
v Parkar
[28]
where Gardiner J states:
“
I
would like to add, with regard to the first count, that although the
law throws upon an insolvent an obligation to attend meetings
after
notice in the Gazette, in common fairness a trustee, in the case of
an insolvent of the class of this man, ought to give
him some verbal
notice in addition to the notice in the Gazette. I state this, not as
a matter of law, but as a matter of common
fairness
”.
48.
It should be mentioned that, since the decision of Di Stefano
mentioned herein above, I
could find no authorities which
specifically answers the question posed in paragraph 46 above, nor
was I referred to any.
In the
recent matter of
Sithole
NO & Others v Mulaudsi & Another
[29]
the learned Tlhapi J refrained from commenting on whether the Master
had an obligation to invite an insolvent to a first meeting
of
creditors.
[30]
49.
The current legal position therefore appears to be that there is no
obligation on the Master
to give notice of a first meeting of
creditors to an insolvent other than by way of publication in the
Government Gazette and that
the lack of individual/personal service
of such notice on an insolvent, is not a defence.
[31]
The argument of Van Der
Ryst that the events during the first meeting of the creditors in his
insolvent estate is reviewable by
virtue of the fact that he did not
attend said first meeting, therefore appears to be incapable of
holding water.
50.
The further argument on behalf of Van Der Ryst that the matter may be
dealt with in terms
of the NCA by virtue of the fact that there is
“
harmonious inter-play
” between the provisions of
the NCA and the Insolvency Act, similarly appears to be incapable of
holding water.
Although it was admitted
on behalf of the Trustees that a harmonious inter-play between the
two sets of legislation might exist,
it was vigorously denied on
behalf of the Trustees that it will have any impact on this matter.
51.
It appears from the papers that were placed at my disposal that the
arguments that were
raised by Mr. Visser on behalf of Van Der Ryst in
respect of the possible extension of reckless credit to Van Der Ryst
and the
referral of the matter to debt review in terms of
Section
85
of the NCA, had already been dealt with by the learned Erasmus AJ in
the unreported matter of
The
Standard Bank of South Africa v Jacobus Coenraad Van Der Ryst
.
[32]
In
dealing with a submission from Mr. Visser, who appeared for Van Der
Ryst in that matter as well, to the effect that the Court
should
utilise the provisions of
Section
85
of the NCA and refer the matter to debt review, Erasmus AJ held that
it would not serve any purpose to do so.
[33]
In
coming to the above conclusion, Erasmus AJ held as follows:
[34]
“
43.1
In this instance the respondent has already utilised remedies
available to him in terms of the NCA, The process failed.
43.2 The respondent
did not make out a case in support of the contention that the
applicant’s granting of the credit facilities
amounted to
reckless credit or that he was over-indebted. The respondent was
privy to all agreements, his bank statements and financial
statements. If he required additional documents, after this
application was lodged, he could have utilised the remedies provided
for in Rule 35(12) to inspect or make copies of documents.
43.3
Any repayment plan, of whatever nature, will in principle depend on
the availability of regular income for the debtor in order
to make
the required payments. He has disposed of his livestock and farming
operations. Based on the history of this matter, any
repayment plans
will in all likelihood not be acceptable options as creditors may
refuse to grant the respondent a rescheduling
of the debt.
”
It should be mentioned
that I could not find anything in the Founding Affidavit of Van Der
Ryst in the Main Application, or in his
Answering Affidavit in the
Security Application to convince me that Van Der Ryst’s
position, since the above judgment by
Erasmus AJ, had changed to such
an extent that he will now suddenly be successful with this argument
in his plight in the Main
Application.
It should be mentioned
that the above decision by Erasmus AJ was upheld by the Supreme Court
of Appeal and I could find no reason
to differ from the above Courts.
52.
In respect of the further relief sought by Van Der Ryst in the Main
Application where he
asks of the Court to direct the Trustees to
examine the claims submitted by the Bank and to report to the Master
and to Van Der
Ryst as envisaged in
Section 45
of the
Insolvency Act or to direct the Master to submit the Bank to
interrogation in terms of the provisions of
Section 44(7)
of the Insolvency Act, I have to also agree with Mr. Zietsman in the
sense that the seeking of this relief seems to be premature
and for
that matter improper.
53.
Section 45
of the Insolvency Act places an obligation
on trustees to examine claims made against the insolvent estate and
that in the event
of any dispute in respect of any claim, the dispute
should be referred to the Master to investigate and to determine.
There appears to be no
case made out as to why the Court in the Main Application should
order the Trustees to abide by the provisions
of
Section 45
of the Insolvency Act and it also does not appear from the papers in
the Main Application why the Master should be ordered to conduct
an
interrogation in terms of
Section 44(7)
of the
Insolvency Act.
The above are obligations
placed on the Trustees and the Master by way of statute and I can
find no reason why the review Court
should be required to order the
Trustees and the Master to do what they are supposed to do, unless
good reason for such an order
exists.
I could find no such good
reason.
54.
In view of all of the above, I am of the view that the relief sought
by Van Der Ryst in
the Main Application is
prima facie
unsustainable and that it appears that the Main Application was
lodged with the sole purpose to annoy.
55.
I consequently find the Main Application to be vexatious and I hold
the view that an order
to the effect that security should be provided
by Van Der Ryst, will not be improper in the circumstances.
I am however not of the
view that security in an amount of R 250 000,00 (Two Hundred and
Fifty Thousand Rand) as prayed for would
be pushing the envelope,
seeing that the calculation of that amount as per the Founding
Affidavit in the Security Application amounts
to, at best, a thumb
suck and also appears to be excessive and I find that an amount of R
150 000,00 (One Hundred and Fifty Thousand
Rand) would be proper as
it will at least be sufficient to serve as security for the Trustees’
estimated future costs in
opposing the Main Application.
56.
In respect of the issue of costs of the Security Application, I hold
the view that it would
not be appropriate to make an order as to
costs in the circumstances.
The reason for this is
simply the fact that I found the Security Application to be not
urgent which in effect means that Van Der
Ryst could be deemed to
have been substantially successful in that regard and I am of the
view that, on this basis alone, it would
not be just to mulct Van Der
Ryst with the costs of the Security Application even though the
Trustees were substantially successful
in the remainder of the
Security Application.
ORDER
:
57.
In view of all of the above, I make the following order:
57.1
That the Respondent be ordered to furnish security in the amount of R
150 000,00 (One Hundred and Fifty Thousand Rand) within 15 (fifteen)
days of date of this order for the costs of the Applicants
in
prosecuting the opposition of the main application under case number
1316/2023;
57.2
That, in the event of the Respondent failing to furnish security in
the
amount of R 150 000,00 (One Hundred and Fifty Thousand Rand)
within 15 (fifteen) days of date of this order, the Applicants are
afforded leave to approach this Court on the same papers,
supplemented if and where necessary for an order dismissing the
Respondent’s
application under case number 1316/2023; and
57.3
No order as to costs is made.
A.D OLIVIER
ACTING JUDGE
For
1
ST
to 3
RD
APPLICANTS:
Adv.
P. Zietsman SC
o.i.o
EG Cooper, Majiedt Inc.
BLOEMFONTEIN
c/o
Van De Wall Inc.
KIMBERLEY
For
RESPONDENT:
Mr.
E. Visser
Etienne
Visser Attorneys
BLOEMFONTEIN
c/o
Van Den Heever Inc.
KIMBERLEY
[1]
Act
34 of 2005.
[2]
Act
24 of 1936.
[3]
Treasure
Karoo Action Group & Another v Department of Mineral Resources
&
Others
[2018] 3 All SA 896
(GP), par
[10]. Also see
Skjelbreds Rederi A/S &
Others v Hartless (Pty) Ltd
[1982] 1
All SA 1
(W), at page 3.
[4]
See
Rule
6(12)(b)
of
the Rules.
[5]
I
suspect that this is a tying error and that “
Applicant
”
should in
fact read “
Respondent
”
with reference to Van Der Ryst.
[6]
Referring
obviously to Van Der Ryst.
[7]
The
said Answering Affidavit was filed a few days out of time as it
apparently had to be
filed by 1 September 2023.
[8]
[2012]
JOL 28244 (GSJ).
[9]
East
Rock Trading 7 (Pty) Ltd
,
supra
at paragraph [6].
[10]
See
Magricor
(Pty) Ltd v Border Seed Distributors CC:
In
re
:
Border
Seed
Distributors CC v Magricor (Pty) Ltd
[2020]
ZAECGHC 103 (SAFLII Reference)at paragraph 38.
[11]
[2013]
ZAECMHC 14 (SAFLII Reference).
[12]
Supra
,
at paragraph [10].
[13]
MTN
Service Provider (Pty) Ltd v Afro Call (Pty) Ltd
[2008]
1 All SA
329 (SCA) at paragraph
[15].
[14]
1938
AD 102.
[15]
See
Ecker
,
supra
at page 110. Also see
Boost
Sports Africa (Pty) Ltd v
South
Africa Breweries (Pty) Ltd
[2015] 3
All SA 255
(SCA) at paragraph [16].
[16]
Ecker
,
supra
at
page 111. Also see
Ramsamy
NO & Others v Maarman NO &
Another
2002 (6) SA 159
(C) at page 173.
[17]
See
inter
alia
Fitchet
v Fitchet
[1986] ZASCA 131
;
[1987]
4 All SA 14
(E) at page 17 as
well as the matter of
Zietsman v Electronic Media Network & Others
[2008] ZASCA 4
;
[2008] 2 All
SA 523
(SCA) at page 4.
[18]
Belmont
House (Pty) Ltd v Gore & Another NNO
2011
(6) SA 173
(WCC) at
page 178.
[19]
Fisheries
Development Corporation of SA Ltd v Jorgensen & Another;
Fisheries
Development Corporation of SA Ltd v AWJ Investments (Pty) Ltd &
Others
1979 (3) SA 1331
(TPD) at page
1339.
[20]
See
African
Farms and Townships Ltd v Cape Town Municipality
1963
(2)
SA 555
(A) at page 565.
[21]
[1997]
2 All SA 241 (A).
[22]
See
Beinash
,
supra
at
page 251.
[23]
This
is quoted from the Answering Affidavit in the Security Application
and specifically
paragraph 18.2 thereof.
[24]
See
R
v Abbass
1916
AD 233
at page 235. See also the matter of
S
v Di
Stefano
[1977] 1 All SA 209
(C) at page 211.
[25]
See
Section
40(3)(b)
of
the Insolvency Act.
[26]
1916
CPD 178
at page 185.
[27]
This
decision was confirmed on appeal in the matter of
Abbass
referred
to in footnote 23 herein
above. See also the matter of
Di Stefano
,
supra
.
[28]
1916
CPD 692
at page 695.
[29]
[2022]
ZAGPPHC 476 (SAFLII Reference).
[30]
See
Sithole
NO
,
supra
at
paragraph [21].
[31]
See
Di
Stefano
,
supra
.
[32]
Northern
Cape High Court Case Number 1294/2021. The matter was heard on
26 November 2021 and
judgment was handed down on 14 January 2022.
[33]
The
Standard Bank of South Africa v Jacobus Coenraad Van Der Ryst
,
supra
,
paragraph [43].
[34]
See
The
Standard Bank of South Africa v Jacobus Coenraad Van Der Ryst
,
supra
,
paragraphs 43.1 to 43.3.