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[2024] ZAFSHC 296
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Mkaza v Municipal Workers' Retirement Fund and Other (2218/2024) [2024] ZAFSHC 296 (26 September 2024)
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IN
THE HIGH COURT OF SOUTH AFRICA
FREE
STATE DIVISION, BLOEMFONTEIN
Reportable
/ Not reportable
Case
no: 2218/2024
In
the matter between
THOMAS
LINDELO MKAZA
APPLICANT
And
THE
MUNICIPAL WORKERS
’
RETIREMENT
FUND
FIRST
RESPONDENT
MAFUBE
LOCAL MUNICIPALITY
SECOND
RESPONDENT
MUNICIPAL
MANAGER: MAFUBE LOCAL
MUNICIPALITY
THIRD
RESPONDENT
CHIEF
FINANCIAL OFFICER
FOURTH
RESPONDENT
EXECUTIVE
MAYOR
FIFTH
RESPONDENT
Coram:
Ramdeyal AJ
Heard:
19 September 2024
Delivered:
26 September 2024
ORDER
The
application for condonation and rescission of judgment is dismissed
with costs including costs of two counsel (where employed)
and to be
taxed on scale B of rule 67A.
JUDGMENT
Ramdeyal
AJ
Introduction
[1]
On the 20
th
of June 2024, the Municipal Worker’s Retirement Fund brought an
application in terms of a notice of motion for an order for
the
respondents to furnish the applicant (the Fund) with a full
accounting of each and every withdrawal or payment or transfer
from
Absa Bank accounts with numbers 405[…], 909[…], 922[…]
and 923[…] and FNB Account no. 628[…]
for the period 10
October 2023 to date.
[2]
A further order requested was for the
respondents to furnish the applicant within five days of the granting
of the order the bank
statements of all the bank accounts mentioned
above for the period 10 October 2023 to date; the bank account number
for the equitable
shares they receive in terms of s 214 of the
Constitution for the financial year 2024/25 and any subsequent bank
account numbers
should the receiving account details change during
the course of this period and each date or period in respect of which
the first
respondent (Mafube Local Municipality, hereafter the
Municipality) is expected to receive the equitable shares as well as
costs.
[3]
The applicant in this case was the fifth
respondent in the above application. He did not oppose the
application, and judgment was
granted against him on the 20
th
of June 2024. Mr. Mkaza, the applicant in this case now seeks
the following orders:
i)
Condoning the late filing of the
application for rescission of judgment, insofar as it may be
necessary
ii)
Rescinding and setting aside the default
judgment granted by the court.
Condonation
[4]
The
application in this case is an application for a rescission of
judgment coupled with an application for condonation in respect
of
the late filing of the application for rescission. The applicant is
required to give a full and honest explanation for failure
to comply
with the rules of court timeously. It is settled in our law that in
considering applications for condonation, the court
has a discretion,
which discretion is to be exercised judicially upon a consideration
of all facts and, in essence, is a question
of fairness to both
sides. The court may enquire into the reasons for the degree of
non-compliance and the explanation tendered.
Importantly, the court
must consider avoiding any unnecessary delays in the administration
of justice
.
A slight delay and a good explanation for non-compliance with the
rules may assist the applicant for his condonation application
to
succeed. If there are no prospects of success then there is no point
in granting condonation. Strong prospects of success may
tend to
compensate for a long delay.
[1]
[5]
The applicant must make out a proper case
for condonation which includes the details of the entire period of
his delay in a comprehensive
explanation.
The
Relevant Uniform Rules of Court Applicable to Rescission of a
Judgment
[6]
Rule 31(2)
(b)
provides as follows:
‘
A
defendant may within 20 days after acquiring knowledge of such
judgment apply to court upon notice to the plaintiff to set aside
such judgment and the court may, upon good cause shown, set aside the
default judgment on such terms as it deems fit.’
[7]
Rule 42 holds:
‘
(1)
The court may, in addition to any other powers it may have,
mero
motu
or upon the application of any
party affected, rescind or vary—
(a)
an order or judgment erroneously sought or
erroneously granted in the absence of any party affected thereby;
(b)
an order or judgment in which there is an
ambiguity, or a patent error or omission, but only to the extent of
such ambiguity, error
or omission;
(c)
an order or judgment granted as the result of a
mistake common to the parties.
(2) Any party desiring
any relief under this rule shall make application therefor upon
notice to all parties whose interests may
be affected by any
variation sought.
(3) The court shall not
make any order rescinding or varying any order or judgment unless
satisfied that all parties whose interests
may be affected have
notice of the order proposed.’
[8]
Generally, a judgment would have been
erroneously granted if there existed, at the time of its issuing, a
fact of which the court
was not aware of which would
have
precluded the granting of the judgment and which would have induced
the court, if aware of it, not to grant the judgment.
[9]
In
an excerpt from the founding affidavit,
[2]
the court appears to have been aware that the applicant’s term
of office was from 1 June 2022 to 31 May 2024. Annexure ‘FA2’
of the main application is the letter of appointment of the applicant
Mr Mkaza by the Executive Head of the Free State and published
in the
Provincial Gazette. The judgment by Majosi AJ granted on 20 June 2024
against Mr. Mkaza was therefore not erroneously granted.
Common
Law
[10]
An
application for rescission on common law grounds must be brought
within a reasonable period. For the applicant to succeed with
such an
application on common law grounds, the applicant must show good cause
or sufficient cause by giving a reasonable explanation
for delay and
showing that the application for rescission was
bona
fide
and showing a
bona
fide
defence to the claim with a
prima
facie
prospect
of success.
In
Chetty
v Law Society, Transvaal
[3]
Miller
J dealing with the concept of ‘sufficient cause’ or ‘good
cause’ stated that, ‘these
concepts defy precise or
comprehensive definition, for many and various factors require to be
considered.’ The learned judge
stated that ‘it is clear
that in principle the two essential elements of “sufficient
cause” for rescission of
a judgment by default are:
i)
that the party seeking relief must present a
reasonable and acceptable explanation for his default; and
ii)
that on the merits such party has a bona fide
defence which, prima facie, carries some prospect of success.’
[11]
The applicant, Mr. Mkaza, contends that he
is not the accounting officer referred to in s 60 of the Municipal
Finance Management
Act 56 of 2003 (MFMA) and has no fiduciary
responsibilities as set out in s 61 of the MFMA, and therefore, no
legal authority upon
which the court can order him to act as set out
in the prayers of the notice of motion.
[12]
The provincial government has ordered an
intervention into the affairs of the municipality as a result of the
crisis in its financial
affairs under the provisions of Section
139(5) (c) of the Constitution and appointed him as the Lead
Provincial EXCO representative
at the Municipality with effect from
1
st
June 2022 to 31 May 2024. Due to the fact that his appointment ended
on 31 May 2024, it had no legal authority to implement any
order this
court may grant. He avers that he has a
bona
fide
defence and the judgment was
granted in error.
[13]
According
to the return of service of the court bundle, the notice of motion
was served on M.A Motaung, the records clerk, a responsible
employee
not less than 16 years of age and in control of the office of the
Municipality at 64 JJ Hadebe Street, Frankfort on 9
April 2024. The
court order was served at the same address on the personal assistant
ostensibly responsible and not less than 16
years of age who was in
control of the applicant’s place of business (fifth respondent
in that matter). Service was complied
with in terms of Uniform rule
4(1)
(a)
(viii).
He also received and opposed a separate application at the same
address.
[4]
He
opposed that application in case number 1653/2024 and participated in
that hearing at this Court on 25 July 2024.
[14]
According to the applicant he became aware
of the court order in this main application on the 26
th
of June 2024. This is also the day of the service. However, he was
not aware of the application as it was not served on him and
not made
aware of it. Yet, he was aware of the other application he chose to
oppose.
[15]
This
contention of the applicant appears to me to be somewhat strange, to
put it in simple terms. This is where he was stationed,
yet during
his effective term, he was apparently not made aware of the
application as per the notice of motion. It was only after
his term
as Lead Provincial EXCO representative (EXCO), which terminated on 31
May 2024, that he became aware of the court order
and judgment
against him. During his term and when the notice of motion was served
at his office he was not aware of same. No judgment
can be sought or
taken against him, he avers, as he was cited as a party to the
proceedings in terms of a lapsed appointment. Therefore,
the judgment
against him was erroneously sought and granted against him in his
absence. A further contention is that the judgment
is invalid because
of the lapse of appointment of the applicant. Counsel for the
applicant referred the court to an article by
Mitchell Nold De Beer
titled ‘Invalid Court Orders’ published in the
Constitutional
Court Review.
[5]
This
article discusses whether courts are entitled to ignore decisions
made in error and not challenged properly and whether the
decisions
should be regarded as valid and effective until challenged. It goes
on to discuss decisions made in error and discusses
various
authorities pertaining to same.
[6]
Counsel
for the applicant has argued that the judgment of the court of the
20
th
of June 2024 (annexure AA6) is not a valid judgment, that judges do
make errors and that this judgment was granted in error. He
referred
to
City
of Johannesburg v Changing Tides 74 (Pty) Ltd and Others
[7]
where
a court order was sought incorrectly and granted erroneously as well
as
Eke
v Parsons
[8]
where
orders that were granted were not granted in terms of the
Constitution and the law.
[16]
The judgment granted in this case against
Mr. Mkaza may have been granted at the time when he was not a member
of EXCO but that
was included in the papers for the court’s
attention and therefore cannot be an error. More especially in my
view Mr. Mkaza
was served with the documents at the time he was a
member of EXCO, and the Lead Provincial EXCO representative. The main
point
of contention is whether he knew about the service of documents
or simply tried to evade the issue because he did not want to comply
with providing the information of the bank accounts sought.
[17]
The application was served on Mr. Mkaza at
his place of employment during his term. Even though he claims not to
have been informed
of same, he was nevertheless the Lead Provincial
EXCO representative at the Municipality at the time the application
was served.
It appears improbable that he could not have known of the
service. It is contended that the applicant did not and does not have
the authority to exercise a power that he did not have. The other
respondents, however, do. What appears probable is that Mr. Mkaza
knew about the service of the notice of motion but chose not to
defend same at the appropriate time and now seeks to defend it.
His
defence is that he does not have authority to give the information
sought by the Fund but does not aver that he does not have
the
information. In any event, from his employment duties and term of
office of two years, it is inevitable that he did not have
access to
the information. Clearly, he has no bona fide defence.
DUTIES
OF THE APPLICANT IN TERMS OF NOTICE IN TERMS OF SECTION 139(5) OF THE
CONSTITUTION OF THE REPUBLIC OF SOUTH AFRICA ,1996
APPOINTMENT OF
LEAD PROVINCIAL EXCO REPRESENTATIVE TO MAFUBE LOCAL MUNICIPALITY AND
DETERMINATION OF HIS POWERS AND FUNCTIONS.
[18]
The Executive Head of the Free State
Province appointed Mr. Nkaza as the Lead Provincial EXCO
representative of the Municipality
with effect from 1 June 2022 to 31
May 2024 to exercise and perform the powers and functions as set out
in annexure ‘FA2’
of the court bundle. Some of the
functions include: submitting a revised Financial Recovery Plan to
the municipal council for inputs
and consideration and to the MEC for
Finance for approval, to ensure that funded budgets are prepared for
the 2023/2024 financial
year, ensuring daily management of cash and
bank balances, providing strategic leadership and direction to
implement the
financial recovery plan, issuing directives and
instructions to the accounting officer and relevant staff to
implement the financial
recovery plan, submitting monthly progress
reports to the MEC for Finance / the Provincial EXCO / the Municipal
Council and the
Minister of Finance, maintaining a record of the
decisions on Financial Recovery plan implementation and assisting in
the preparation
and implementation of the Financial Recovery Plan.
[19]
The above powers and duties conferred on
the applicant in itself is indicative of the applicant’s
involvement and information
of the financial issues of the
Municipality, which he does not deny, and could only obtain same by
having access to the bank accounts
and relevant bank statements as
sought in the notice of motion for the main application. He is not
the accounting officer as he
avers and does not have fiduciary duties
but his duty and power delegated to him to confer on the accounting
officer is much higher.
He has to issue directives and instructions
to the accounting officer. He did have the necessary power, duties
and obligations
in the management of the Municipality’s
finances during his term of appointment and at the time the notice of
motion application
was served at his place of employment, and his
involvement in same, cannot simply vanish 20 days later when the
order against him
was granted by a court of law. His defence of
lapsed appointment is not a reasonable explanation, does not hold
water for a
bona fide
defence and simply appears to be that Mr Mkaza ‘was playing for
time’ by using specious excuses to gain time, hence
causing
unnecessary delays in the administration of justice. He had access to
the relevant information sought and was in a position
to furnish the
required information.
[20]
It is common cause that the Municipality is
indebted to the Pension Fund for a large amount of money. The Pension
Fund has brought
several applications in this court to assist its
members by retrieving the money from the Municipality, but to no
avail. The applicant
is appointed as an EXCO representative with
authority and power to assist the Fund in obtaining the information
it requires but
contests that he has that power and authority to do
so. In terms of the duties conferred upon him he does have the
authority and
power to provide the information the Fund so seeks. The
plight for justice of the members of the Fund continues over the
years,
yet the applicant rather seeks to use technicalities and
frivolous defences instead of assisting the members with this
difficult
task when he is able to do so.
CONCLUSION
[21]
In respect of condonation, I am not
satisfied that the applicant has given a full and honest account of
his failure to comply with
the Rules timeously. I have also discussed
the various rules brought under rules 31(2)
(b)
and 42 as well as the common law. In my view, the applicant has
failed to meet the requirements applicable in respect of all.
[22]
In the circumstances
I make the following order:
The
application for condonation and rescission of judgment is dismissed
with costs including costs of two counsel (where employed)
and to be
taxed on scale B of rule 67A.
T
Ramdeyal
Appearances
For
the Applicant:
LR
Bomela
Instructed
by:
State
Attorney Bloemfontein
For
the First Respondent:
Pieter
van der Berg SC
Hannine
Drake
Instructed
by:
McIntyre
van der Post
[1]
See
Melane
v Santam Insurance Co Ltd
1962 (4) SA 531
(A) at 532C and
United
Plant Hire (Pty) Ltd v Hills
1990 (1) SA 717
at 720E-G in respect of condonation applications.
[2]
See
annexure
‘AA7’
on page 125 of the rescission application para 27.
[3]
Chetty
v Law Society, Transvaal
1985
(2) SA 756
(A) at 765 A-E.
[4]
Annexure ‘AA2’ of the court bundles refers.
[5]
De Beer ‘Invalid Court Orders’ (2019)
Constitutional
Court Review
Vol 9 at 283-315.
[6]
Ibid
at
285.
[7]
City
of Johannesburg v Changing Tides 74 (Pty) Ltd and Others
[2012] ZASCA 116; 2012 (6) SA 294 (SCA).
[8]
Eke
v Parsons
[2015] ZACC 30
;
2015 (11) BCLR 1319
(CC).