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2024
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[2024] ZAMPMBHC 32
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Minister of Agriculture, Land Reform and Rural Development and Another v D and M Mabunda Incorporated and Others (658/2021) [2024] ZAMPMBHC 32 (22 May 2024)
THE
HIGH COURT OF SOUTH AFRICA
MPUMALANGA
DIVISION, MBOMBELA MAIN SEAT
CASE
NO: 658/2021
(1)
REPORTABLE: NO
(2)
OF INTEREST TO OTHER JUDGES: NO
(3)
REVISED.
DATE:
22 May 2024
SIGNATURE
In
the matter between:
MINISTER
OF AGRICULTURE, LAND FIRST
APPLICANT
REFORM
AND RURAL DEVELOPMENT
THE
REGIONAL LAND CLAIMS SECOND
APPLICANT
COMMISSIONER,
MPUMALANGA PROVINCE
and
D&M
MABUNDA INCORPORATED
FIRST
RESPONDENT
MATHEBULA
NGIRIVANE COMMUNITY
SECOND
RESPONDENT
SHERIFF
OF THE HIGH COURT FOR THE THIRD
RESPONDENT
DISTRICT
OF MBOMBELA
REGISTRAR
OF THE HIGH COURT
FOURTH
RESPONDENT
MBOMBELA
(MAIN SEAT)
JUDGMENT
RATSHIBVUMO ADJP:
Delivered:
This judgment was handed down
electronically by circulation to the parties' representatives by
email. The date and time for hand-down
is deemed to be 14H00 on 22
May 2024.
Introduction
[1]
This is an application for the rescission
of judgment granted by this court
per
Shai AJ on 03 August 2023. The order by Shai AJ made the two
settlement agreements dated 19 July 2023, orders of the court. The
first settlement agreement was entered between the Second Respondent
and the First Respondent. In terms of that agreement,
1.1
the First Respondent undertook to withdraw
its opposition to the rescission of judgment application brought by
the First Applicant
and the Second Respondent;
1.2
it was acknowledged that the Second
Respondent was indebted to the First Respondent as well as Kholonyane
K Attorneys for legal
fees;
1.3
the Commission on Restitution of Land
Rights shall, within 15 days from the date of receipt of this
settlement, pay directly to
the First Respondent, the amount of R18.2
million from the amount payable by the Second Applicant in respect of
legal fees for
both the First Respondent and Kholonyane K Attorneys;
1.4
the Commission on Restitution of Land
Rights, on behalf of Ngirivane Mathebula Investment Fund, shall pay
the aforementioned amount
into the bank account of MP Maseko
Attorneys Inc.
[2]
The second settlement agreement was entered
between the Second Respondent, the First Respondent and the First
Applicant. In terms
of that agreement, the First Respondent undertook
to withdraw its opposition to the rescission of judgment application
brought
by the First Applicant and the Second Respondent.
The
Applicants have no issues with the second agreement. It is the first
agreement that they seek to have rescinded. This application
is
opposed by the First Respondent.
Background
.
[3]
In 1998, the Second Respondent lodged a
land claim against the Land Claims Commission in accordance with the
Restitution of Land
Rights Act, no. 22 of 1994 (the
Restitution of
Land Rights Act), in
respect of the area stretching from Orpen Gate
to Satara Rest Camp of the Kruger National Park, including villages:
Balule Mnyamani,
Nsemani, Ngirivane, Sweni, Kumana, Nwantsi, Madjidji
and Campiano situated in the Bushbuckridge Municipality. This claim
was settled
on 21 May 2016 when an agreement was signed between the
First Applicant, the Minister of Environmental Affairs and the Second
Respondent.
[4]
In terms of the settlement agreement signed
on that date, the First Applicant shall pay to the Second Respondent,
sums of money
in two phases. In phase one, the amount of
R15 088 792.00 shall be deposited to the Second Respondent,
from which R110 947.00
shall be paid to each verified household
that is a member of the Second Respondent, as compensation for loss
of improvements that
were on the claimed land during dispossession.
In phase two, the First Applicant shall pay an amount of
R37 237 055.55,
being the land value in respect of the
claimed land to the community to be used as a base to fund the
beneficiation scheme to be
entered into (development).
[5]
Following this settlement, and on 24
February 2021, the First Respondent instituted motion proceedings
against the First Applicant
and the Second Respondent in this court,
the order of which, was granted by default as it was unopposed. In
terms of the order
which was granted on 31 August 2021, the agreement
entered between the First Respondent and the Second Respondent
(involving the
legal fees) was declared valid and binding between the
parties. It was furthermore, declared that the First Applicant was
not a
party the agreement between the First and the Second Respondent
(on legal fees). The First Applicant was also directed to pay the
First Respondent the lesser of R25% of the settlement amount to the
Second Respondent on attorney and own client bill of costs,
taxed at
no more than double the attorneys fee, whichever is lesser.
[6]
An application to rescind the default
judgment granted on 31 August 2021 was launched by the First
Applicant and the Second Respondent
on 08 December 2021. Following
negotiations between the parties, a settlement was reached between
the parties resulting in the
order made by Shai AJ referred to above.
Grounds for
rescission.
[7]
The
application is premised on the provisions of Rule 41(2) of the
Uniform Rules of the High Court.
[1]
In the alternative, the application is in terms of the common law Two
grounds were advanced by the First Applicant in this regard.
Under
the first ground, the First Applicant avers that the order was
granted erroneously in that it was granted without the participation
of a party with substantial interest in the subject matter of the
Court order. The second ground is that the agreement is in
contravention
of
sections 42C
and
42D
of the
Restitution of Land
Rights Act in
that it seeks to make use of the funds ring-fenced for
land development, for purposes of payment for legal bills.
[8]
Rule 41(2) of the Uniform Rules provides,
“
(2)
Any party in whose favour any decision or judgment has been given,
may abandon such decision or judgment either in whole or
in part by
delivering notice thereof and such judgment or decision abandoned in
part shall have effect subject to such abandonment.
The provisions of
subrule (1) relating to costs shall
mutatis
mutandis
apply in the case of a
notice delivered in terms of this subrule.”
[9]
The First’s Applicant reliance
on Rule 41(2) appears to have been erroneous in that the rule does
not support the case advanced.
To start with, the decision granted by
Shai AJ favours the First Respondent in this case. If there is any
party who could decide
to abandon that judgment or a part thereof, it
would be the First Respondent as the judgment was granted in its
favour. The case
advanced by the Applicants here is to the effect
that the court erred when it granted an order based on a settlement
agreement
that the litigants did not sign and that the terms thereof,
are in contravention of a national legislation.
[10]
Orders
erroneously sought and granted can be rescinded based on Rule 42. The
Applicants must have avoided Rule 42 for the reason
that the order
was not granted in their absence. Unfortunately, the First Respondent
presented its response as though the First
Applicant presented its
application based on Rule 42, which appears to have been a secondary
error. This application will as such
be decided under the common law.
One of the basis for rescission under common law involves judgments
granted in the absence between
the parties of a valid agreement to
support them, on the grounds of
justa
causa
[2]
.
[11]
The document presented to the court as the
basis for judgment by agreement (the first agreement) does not
support the agreement
in question in that the litigants sought to be
bound, in particular, the First Applicant who has to pay the amount
agreed therein;
is not a party to it. Those whose names were listed
in the settlement agreement and also appended their signatures, are
the First
and the Second Respondent’s representatives. The
absence of the First Applicant’s signature in this document is
conspicuous
not only because he is party expected to make a payment,
but also because his names appears in the second agreement that was
made
an order of court in the same court order, dealing with the
rescission of judgment.
[12]
The omission of the First Applicant as a
party to the first agreement could therefore not have been by error,
but out of choice.
Ironically, the judgment that the first agreement
rescinded included an order sought and granted in favour of the First
Respondent,
to the effect that the First Applicant, who had not
signed the fee agreement between the First and the Second Respondent,
was not
a party thereto meaning, he could not have a say about its
validity. It appears to me that this application is a simple
extension
of what the First Respondent asserted in demanding
non-involvement of persons not parties to an agreement. On this
ground alone,
the rescission stands to be allowed.
[13]
Section 42C
of the
Restitution of Land
Rights Act provides
,
“
42C
Financial aid
(1)
The Minister may from money appropriated by
Parliament for this purpose and on such conditions as he or she may
determine, grant
an advance or a subsidy for the development or
management of, or to facilitate the settlement of persons on, land
which is the
subject of an order of the Court in terms of this Act or
an agreement in terms of section 14 (3) or 42D or which is
expropriated
in terms of section 42E, to
(a)
any claimant to whom restoration or the
award of a right in land has been ordered…
(2) For the purposes of
subsection (1) 'development of land' includes the facilitation of the
planning of any development of land.”
[14]
This
court was referred to a judgment of
Bakgatla-Ba-Kgafela
Community Property Association v Chief Land Claims Commissioner &
Others
[3]
where the court in interpreting if section 42C can accommodate the
usage of funds released for development purposes as envisaged
in this
section, to pay professional fees such as legal costs. The Land
Claims Court held,
“
[I]n
my view, section 42C poses no legal impediment to the use and
approval of a section 42C advance or subsidy for purposes of
preparing a development plan… I am not however persuaded that
a section 42C advance or subsidy can lawfully be approved
or used to
pay legal fees that may be owed to enforce the settlement agreement.
While certain legal fees may comfortably fall within
the purview of a
section 42C grant or subsidy, this expenditure does not serve the
‘development or management of, or …
the settlement of
persons, on [restored land]’. While notionally, forensic fees
might fall within the scope of ‘management’
of restored
land, there is insufficient information before the Court to determine
whether the forensic fees incurred in this case
fall within that
category.”
[4]
[15]
It
appears plainly clear from the above that if the same interpretation
is adopted here, the settlement in terms of which it was
agreed to
use the funds ring-fenced for land development, in order to pay for
legal fees, may not be enforceable. It should be
remembered that at
this stage of proceedings, the duty on the Applicants is merely to
show
bona
fide
defence. The court is not expected to pronounce on whether it agrees
with the interpretation referred to in
Bakgatla-Ba-Kgafela
.
That would be dealt with when the merits of the case are adjudicated
upon. The Applicants need only to show the
bona
fides
of the defence on the merits of the case which
prima
facie
carries some prospect of success; a balance of probability need not
be established.
[5]
I therefore
hold a view that the Applicants have a
bona
fide
defence which if successfully argued, could be a valid defence
against the First Respondent’s claim. The rescission of
judgment
stands to be allowed also on this reason.
Costs.
[16]
I am not persuaded that this is one of the
cases where costs should follow the outcome. Given the history of the
litigation, I hold
a view that the First Respondent’s
opposition to the rescission application is reasonable. The
Applicants were legally represented
when the agreements were made an
order of court. The legal representative present in court was
afforded an opportunity in which
the mandate could be verified on
whether the agreements should be made court orders. Had the
Applicants or their legal representative
been alive to what they now
present as grounds for this application, the protracted proceedings
could have been avoided. For this
reason, the First Respondent should
be awarded its costs for opposing this application.
[17]
I therefore make the following order:
17.1
The order by Shai AJ in terms of
which a settlement agreement marked X1 was made an order of court,
dated 03 August 2023, is hereby
rescinded.
17.2
The Applicants are ordered to pay the
First Respondent’s costs, jointly and severally, the one
paying, the other to be absolved;
such costs to include the
employment of two Counsel by the First Respondent, one being a Senior
(where so employed).
TV RATSHIBVUMO
ACTING DEPUTY JUDGE
PRESIDENT
MPUMALANGA DIVISION
FOR THE APPLICANTS:
ADV C ERASMUS SC
ADV
HA MPSHE
INSTRUCTED BY:
TARWA ATTORNEYS INC
MBOMBELA
FOR
THE FIRST RESPONDENT:
ADV
L KOK
ADV
T NGWENYA
INTRUSCTED
BY:
MP
MASEKO ATTORNEYS
MBOMBELA
DATE
HEARD:
26 MARCH 2024
JUDGMENT DELIVERED:
22 MAY 2024
[1]
See
paragraph 78 of the Founding Affidavit on p. 29 of the paginated
bundle.
[2]
See
Erasmus’ Commentary on Uniform Rules of the High Court under
Rule 42 where
MEC
for Economic Affairs, Environment & Tourism v Kruisenga
2008
(6) SA 264
(Ck) was referred to as an authority
.
See
also
Moraitis
Inv (Pty) Ltd v Montic Dairy (Pty) Ltd
2017
(5) SA 508 (SCA)
[3]
(LCC08/2021)
[2022] ZALCC 24 (8 July 2022)
.
[4]
See
Bagatla-Ba-Kgafela
supra
,
at para 84.
[5]
Georgias
v Standard Chartered Finance Zimbabwe Ltd
2000
(1) SA 126
(ZS) at 132G–I.