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IN THE HIGH COURT OF SOUTH AFRICA
GAUTENG DIVISION, PRETORIA
CASE NO: 7435/ 2021
In the matter between:
THE GOVERNMENT EMPLOYEE PENSION FUND APPLICANT
and
GIJIMA HOLDINGS PTY LTD RESPONDENT
This judgment was handed down electronically by circulation to the parties ’
representatives by email. The date and time of hand -down is deemed to be 31 January
2025
Authority to act/institute legal proceedings granted by an agent exercising a delegated
authority –Delegated authority –what constitute proof thereof - Is it necessary t hat the
delegation of authority be confi rmed by the principal .
(1) REPORTABLE: YES/NO
(2) OF INTEREST TO OTHER JUDGES: YES/NO
(3) REVISED.
DATE SIGNATURE
31/01/ 2025 N V KHUMALO J
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JUDGMENT
___________________________________________________________________
Khumalo N V J
Introduction
[1] This is an Application in terms of Rule 7 (1) of the Uniform Rules of Court, for
an order declaring that Diale Mogale Attorneys , the attorneys acting on behalf of the
Government Employees Pension Fund, the plaintiff in the main action instituted
against Gijima Holdings, the Respondent / Defendant in the main action , so authorised
to do so .
Parties
[2] The Government Employees Pension Fund (“GEPF ”), cited as the Applicant
herein is a juristic entity governed by the Government Employees Pension Law, 1996
(Proclamation 1 of 1996), as amended (“The GEP Law ”). It is an independent pension
fund that manages pensions and related benefits on behalf of qualifying government
employees, and a separate juristic person from the Government. The Respondent ,
Gijima Holdings is a private limited company incorporated and registered in
accordance with the Company Laws of South Africa .
Background facts
[3] The Applicant is the owner of two office buildings, namely Venus and Neptune
situated in Kosmosdal, Centurion which buildings were rented out to the Respondent
(“the leased properties ”) in terms of a lease agreement concluded and signed by the
Respondent and Mowana Properties (Pty) Ltd (“Mowana ”), a property management
company acting on behalf of the Applicant. The arrear rental owed by the Respondent
on the properties form the subject matter of the main action instituted on behalf of the
Applicant by Diale Mokgale Attorneys (‘DMA ”) on instructions by Mowana .
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[4] The Respondent challenge s DMA’s authority to act on behalf of the Applicant
and in so doing had filed a Notice in terms of Rule 7 (1) demand ing that DM A file the
necessary documents that establishe s its authority.
[5] Rule 7 (1) provides that:
“(1) Subject to the provisions of subrules (2) and (3) a power of attorney to act
need not be filed , but the authority of anyone acting on behalf of a party may,
within 10 days after it has come to the notice of a party that such person is so
acting, or with the leave of the court on good cause shown at any time before
judgment, be disputed, whereafter such person may no longer act unless he
satisfied the court that he is authorised so to act, and to enable him to do so
the court may postpone the hearing of the action or application. ” (emphasis
added) ”
[6] In response to the Respondent ’s Rule 7(1) Notice , DM A filed an affidavit
deposed to by the managing director of Mowana , one Samuel Ramuhashi
(“Ramuhashi ”) (“Authority Affidavit ”) stating that he was authorised by Mowana to
depose to the Authority Affidavit on behalf of the Applicant and to confirm DMA’s
authority to act on behalf of the Applicant and institute the action . A resolution by
Mowana authoris ing Ramuhashi to depose to the Authority Affidavit, and the
appoint ment of DMA to act on behalf of the Applicant and issue the Summons was
filed with the Authority Affidavit . Also attached was a confirmatory affidavit by Mr
Mpumelelo Madi, an asset manager at the Pensions Investment Corporation SOC
Limited (“PIC”). Mr Madi confirm ed the appointment of DMA to the panel of attorneys
by the PIC and Mowana , and attaching the appointment letter from both th e PIC and
Mowana .
[7] PIC is an asset management firm wholly owned by the government of South
Africa, and established on 1 April 2005 in accordance with the Pub lic Investment
Corporation Act , 2004 (Act no 23 of 2004) . It is common cause that ’the PIC is an
investment manager of the Applicant ’s property portfolio duly appointed as such by the
Applicant , pursuant to its functions as an asset management firm. It therefore has the
authority to represent and act as the Applicant ’s agent , managing the Applicant ’s
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property portfolio . A fact so highlighted in the Authority Affidavit. In that instance PIC’s
actions in relation to the Applicant ’s property folio , are binding to the Applicant.
[8] Ramuhashi explained in his affidavit that the Applicant wholly outsourced its
investment and related activities in relation to the leased properties to the PIC. As the
Applicant ’s investment manager , the PIC is authori zed to act as an agent in the
manag ement of the Applicant ’s property portfolio , and as such employ attorneys to act
on Applicant ’s behalf , whilst also vested with the power to delegate that function . He
also attached a copy of the delegation of authority by the Applicant . The PIC had in
line with th at delegation of authority o utsourced the whole of its property management
function to Mowana in terms of a property management agreement (PMA) it concluded
with Mowana on 11 March 201 6. A copy of the extracted relevant parts of the PMA
was attached to the particulars of claim as Annexure “C.” The appointment was to be
effective from 1 December 2015 . In terms of the PMA Mowana is authorised to
represent th e Applicant in all matters related to the immovable properties owned by
the Applicant including the two buildings rented by the Respondent. Hence its
conclusion and signing of the lease agreement on behalf of the Applicant.
[9] The PMA is further alleged to authorise Mowana “to take steps in respect of the
rental enterprise, in the name of the Applicant in any court of law and to amongst other
things, institute or defend any action or other proceedings , sign any documentation
including affidavits and power of attorney to give effect to the aforegoing. ” Whilst the
attache d delegation of authority edified on the appointment of external attorneys and
legal Counsel.
[10] A resolution passed and signed by Mowana directors , authorised Ramahushi
(its manag ing director ) to depose to the Authority Affidavit and the appointment of DM A
to act on behalf of the Applicant and in so doing institute summons against the
Respondent for the arrear rental owed in terms of th e lease agreement . DMA was
appointed on 21 August 2020 in terms of the delegated authority after recommendation
by Beneke, Mowana ’s legal and compliance manager , follow ed by the regional asset
manager ’s approval and confirm ation by the PIC’s asset manager on 17 August 2020 .
A confirmatory affidavit to those facts is also deposed to by Mr P J De Beer, a director
at DMA.
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[11] According ly, the Applicant argued that DMA was as a result legally instructed
by M owana to represent the Applicant/Plaintiff in all capacities , which was in
accordance with Mowana ’s resolution . DMA is also alleged to have acted on behalf of
and represented the Applicant in a host of other litigations since March 2019 . On that
basis it was submitted on behalf of Applicant that DM A’s authority to ac t on behalf of
the Applicant proven.
[12] The Respondent rejected the Authority Affidavit , which resulted in the Applicant
launching the Rule 7 Application , for the court to declare that DMA duly authorised to
act on behalf of the Applicant. Ramuhashi depos ed to the Founding Affidavit and Mr
Yagashen Pillay, a director from DMA filed a confirmatory affidavit
[13] Ramuhashi again highlighted the fact that the PIC had in terms of the PMA
outsourced the whole of its property management function in relati on to the Applicant ’s
property portfolio t o Mowana. Moreover , that t he agreement authorises Mowana to
represent the Applicant in all matters relating to immovable property owned by the
Applicant, to take any steps in relation to the rental enterprise in the name of the
Applicant in any court of law, sign any documents or affidavits to give effect to the
action. He also referred to the delegation of authority matrix that covers the
appointment of attorneys and sets out the function of approving the sele ction , extracts
thereof which were attached to the Authority affidavit.
[14] The Acting Executive Head: Property and Chief Operations Officer ( COO ) of
the PIC, Mr Vuyani Wellington Hako (“Hako ”) deposed to a confirmatory affidavit in
support of the application, in which he c onfirm s that the Applicant outsourced its
investment and related activities to the PIC. Further that t he PIC acts as the Applicant ’s
agent, and the Applicant is indeed bound by the PIC’s actions.
[15] Subsequent to the Applicant ’s Rule 7 (1) Application, the Respondent served
a Rule 35 (12 ) notice demanding that the Applicant make available for inspection the
agreement signed by the Applicant appointing the PIC as its investment manager ,
notwithstanding that this was not in dispute . The Applicant refused to discover the
document on the basis that it is not only confidential and commercially sensitive but
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also irrelevant for the purposes of compliance with Rule 7 (1) Notice as the relevant
parts were extracted and filed . The Applicant however tendered the document to the
court on the basis that it was highly sensitive . The Respondent also asked for a copy
of the PMA between the PIC and Mowana.
[16] In opposing the Application the Respondent ’s attorney, Mr Kahn deposed to the
answering affidavit, disputing the authority of DM and of Mowana on the following
grounds:
[16.1] That even though the Applicant is reflected to be a party to th e
Application purportedly represented by Mowana there is seemingly no
document or affidavit attached to the Application that emanates from or is
deposed to by an officer or representative of the Applicant that confirms that
representation . The Respondent th erefore argue d that it is possible that the
Applicant is not even aware of the Application .
[16.2] Ramahushi ’s assertion that he has the relevant authority to represent
the Applicant is disputed since nothing in the Application proves that he has
such authority or anything that empowers Mowana so to act and more
particularly to involve the Applicant in litigation in respect of the action , there
being no such confirmation by the Applicant. The Applicant had dealt with the
matter superficially from prior the institution of the main action and in the
information made available in its Founding Affidavit.
[16.3] On the information deposed to in the Founding Affidavit and in the
Authority Affidavit, it cannot be fairly or properly concluded that DM A is
mandated to act on behalf of the Applicant in the action . Either the Applicant or
DMA has to demonstrate or prove to the court that DMA has a valid mandate ,
or that Mr Ramuhashi i s authorised to depose to the A uthority Affidavit , since
should it be found that DM A, as the purported agent, is not validly instructed,
the Applicant has a right to assert that it is not bound by any of the purported
agent ’s actions or failure to take action .
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[16.4] Furthermore , regarding i ts historical challenge of DM A”s authority prior
and post the institution of the action, and DMA ’s continued failure since then to
establish such authority despite Mr Kahn ’s threat s to from then onwards
address further communications to Mowana , whilst continu ing to exchange
correspondence and interact with DM A post the institution of the action , it
disputes that the onwards interaction was a confirmation or acceptance of DM ’s
authority to act on behalf of the Applicant.
[16.5] If the court could not find that Mowana is in fact a sub -agent, properly
mandated to act on behalf of the Applicant in this action then Ramahushi the
deponent to the Founding Affidavit is not validly authorised to depose to the
Founding Affidavit on behalf of the Applicant and therefore this Application not
validly before court. Also most of the facts are not within the personal
knowledge of Ramahushi and therefore cannot be to the best of his belief both
true and correct.
[16.6] It is disputed that the resolution passed by Mowana directors is a valid
resolution passed in a law fully convened meeting as according to the CIPC
report the Applicant has 6 directors whilst t he resolution refers to 3 directors . It
does not specify which of the 6 directors were factually present or present by
proxy when the resolution was taken, if the meeting was quorate , timeous and
a proper notice of the meeting issued. Further, even if the resolution was valid,
it does not autho rise Ramah ushi to act on behalf of the Applicant but of Mowani ,
who ex facie the Founding Affidavi t has no relationship with the Applicant. His
deposing to the supporting affidavit on behalf of the Applicant and so bind the
Applicant is therefore challenged. The resolution is further said to have no
indication that the Applicant is aware of the action taken on its behalf . The
presentation of the document a s a valid resolution alleged to be an inadequate
response to the challenge to DMA ’s authority. For that reason, the allegation
that either the Applicant or Ramah ushi has filed a document that constitutes or
purports to constitute an enabling resolution pursu ant to which DM A is
authorised to act on behalf of the Applicant disputed.
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[16.7] Moreover the Respondent disputes the delegation of authority attached
to the Authority Affidavit on the basis that it fails to identify which of the many
items referred thereto is of application against the Respondent ’s challenge of
DMA’s authority and why . The Respondent a lso justifies the request for and
interrog ation of copies of the documents/ agreements/resolutions referred to on
the basis that it needs to be established if housekeeping arrangements and
internal compliance requirements have been satisfied, specially of a party that
is an organisation that is as vast as the Applicant and PIC . It denies that its act
of serving the Rule 35 (12) on DM A has any significance to whether or not it
accepts DM A’s authority to act on behalf of the Applicant.
[16.8] Finally that, even though the Application is purported to be brought by
the Applicant , DMA was in actual fact supposed to have brought the Application
as it is the one required to prove that it is authorised to act on behalf of the
Applicant. The Rule does not require that Applican t prove that DMA properly
mandated to act on its behalf. As a result , the Respondent prays for a dismissal
of the Application and a cost order against the Applicant, DM A and Mowana
jointly and severally, the one paying the other to be resolved.
[17] In a lengthy reply, Ramah ushi criticised the Respondent ’s opposition to the
Application , seemingly also addressing its Rule 35 (12) contending that:
[17.1] the Respondent seeks disclosure of information in the PMA relating to
the PIC’s appointment of Mowana as a sub agent in the management of the
leased property , which information is irrelevant and confidential as indicated in
reply to Respondent ’s Rule 7 Notice . The agreement is commercially sensitive
and there has been sufficient disclosure of what is relevant for the purpose of
Rule 7 . The reasons offered for Respondent ’s objections to DM ’s authority to
act are contrived and such objection being an abu se of court process , designed
solely to delay .
[17.2] Mr Kahn ’s probing of the validity of occurrences prior the Application in
disputing DMA ’s authority is questionable, which brings doubt if the Respondent
has indeed acquiesced to the opposition of the Application or Kahn on a fishing
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expedition or a frolic of his own . He has n ot specif ied why the court should not
be satisfied with the documents already presented to it . The opposition to the
Application is an abuse of the court process and Mr Kahn ’s approach
inconsistent with the requirements provided by subrule 7, that the court must
be satisfied that the authority exist ed at the ti me when proof of such authority
is required . The risk being minimal that an attorney will act without authority ,
with the court honouring that approach that would lead to the elimination of
many pages of resolutions, delegations and substitutions still attached to
Applications.1
[17.3] He points out that Kahn seems not to accept the confirmation by the
Acting Executive Head and COO of PIC Mr Hako, that the PIC ’s actions as the
Applicant ’s agent are binding on the Applicant. Further that the Applicant has
outsourced its investment and related activities to PIC whilst PIC has
outsourced the whole of its property management function to Mowana in terms
of the PMA. The agreement in turn authorises Mowana to represent the
Applicant in all matters that relate to the immovable properties owned by the
Applicant, to take any ac tion /steps in respect of the rental e nterprise, institute
and defend any action and sign any documents including affidavits and powers
of attorney to give effect to the mandate.
[18] Kahn is said to be oblivious to the fact that Ramahishu has set out on the
delegation of authority , the relevant clauses of the delegation matrix and the relevant
parties involved in the process , for which he was criticised by Kahn for attaching
without explaining how it was to be interpreted and referred to , hence to be of no
benefit or value . This was also confirmed under oath by the PIC ’s COO which the
Respondent fails to address . In terms thereof “The PIC grants Mowana the signing
authorities as reflected in th is documentation in respect of the PIC portfolio which is
currently managed by Mowana . He refers to the criticism as also highly confusing . The
criticism against the delegation of authority that it does not advance the Applicant ’s
case , he regards the criticism to be contrived and to make the purpose of Rule 7 not
to make proof of authority cumbersome , impractical.
1 Reference to Eskom
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[19] In response to Kahn ’s contention that it is possible that the Applicant is not
aware of the proceedings instituted on its behalf, the Applicants points out that there
is no reason for Kahn to b elieve that an application of this magnitude would have been
launched unauthorised , since K ahn also served all processes and correspondence in
these proceedings directly on the Applicant . A copy of a letter dated 3 May 2021 from
Applicant ’s Principal Executive Officer is furthermore attached. It r eads “the GEPF has
instructed the PIC and or its managing agent, being Mowana properties to appoint
attorneys to act on behalf of GEPF in taking the necessary legal steps to recover and
collect arrear rental d ue by Gijima Holdings Pty Ltd in respect of it leasing and
occupying space in immovable property belonging to the GEPF. ” The Respondent had
also addressed all formal correspondence intended for the Applicant to the PIC,
Mowana and DMA attorneys whilst taking an exception to the particulars of claim.
[20] The Applicant points out that the Responden t accepts that the PIC is the
Plaintiff ’s agent and that its CEO being the authorised representative has confirmed
under oath that DMA and Mowana are authori sed to act on behalf of the Applicant.
However regards Kahn ’s reliance on the PGM Mines matter2 to be misplaced a nd
argue that the decision clearly wrong. Kahn had also fail ed to demonstrate the source
of his alleged bona fide belief that DM A is not properly authorised to act on behalf of
the Applicant .
[21] Accordingly Kahn a lso in the letter dated 11 March 2021 accepted Mowana ’s
authority by threatening to stop any further communication with DM A and to hence
forth liaise with the Applicant at c/o Mowana , but now argue that this court cannot find
that Mowana was a sub agent of the Applicant , which is an entire ly different challenge
to the one that was raised when the litigation was instituted.
[22] On the question of the directors, the Applicant points out that Mr D Orapeleng
Mosito is not a company director at M owana but its company secretary as confirmed
in the Affidavit he deposed to. Also that Ms Kholiwe Fana was appointed as director
2 PMG Mining (Pty) Ltd and Another v J D Chen and Others , unreported decision of Satchwell J in the
Johannesburg Local Division Case no: 2016/19065X
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by the Board of Directors on 9 April 2021 and the formal notice only lodged on 21 April
2021. A resolution to authorise the action and appointment of DM was prepared by the
Company Secretary and did not include Ms Fan a as at the time the notice of
amendment o f directors w as not yet lodg ed with the CIPC. As an act of caution a copy
of another resolution signed on 14 February 2022, that includes Fana ratifying the
resolution taken on 9 April 202 1 was signed and attached. Ms Reitumetsi Michelle
Molobi resigned as director on 19 May 2020 as reflected in the CPIC search report.
He argue s that the purpose of the Rule is not to establish the validity of the resolution
as contended by Kahn unless if he can demonstrate the resolution ’s invalidity
whereupon an investigation will eventuate.
[23] On the argument that Ramah ushi not authorised to depose to the Authority
Affidavit in Reply to the Rule 7 Notice on behalf of the Applicant , he points out that the
resolution specifically appoints him as the managing director of Mowana to depose to
the Affidavit and appoints DM A to act on behalf of the Applicant. The error relating to
the leasing manager has been confirmed by the COO of the PIC.
[24] Finally on Kahn ’s demand of proof of the validity of the agreements entered into
between the Applicant, PIC and Mowana , the Re spondent argues that Kahn makes
the demand without tendering proof f or his perception that the agreements might be
invalid . Similarly that Kahn ’s Rule 35 (1 2) request of the PMA a fishing expedition as
he has been provided with an extract of the relevant provisions in the agreement that
expressly set out the appointment and authority of Mowana , certified by Mowana ’s
company secretary and confirmed under oath. The rest was not provided on the basis
of commercial sensitivity and ir relevancy for the purpose of subrule 7 (1) proceedings.
The information concerns inter alia, pricing , fee structure between agents , lists of
clients , details of clients ’s respective rentals and properties , security sensitive
information on occupancy by ind ividual tenants like SARS, banks , certain Government
Departments and details of respective residential leases and tenants . It reckons, since
Kahn ’s firm describ es itself as a deal maker and adviser , specifically in looking for and
negotiating terms with landlords on behalf of the Respondent, it is not possible to
prevent the firm from using the knowledge acquire d from the PMA in the course of
their advisory and deal making services.
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[25] The Applicant argue d that the Respondent ’s opposition consist s of abuse of the
court processes and therefore costs for two Counsels should be granted against the
Respondent on an attorney and client scale.
Issue to be determined.
[26] The principal issue to be determined is w hether there has been s atisfactory
proof that DMA duly authori zed to act on behalf of the Applicant, the former ’s actions
binding to the latter .
[27] The secondary issue to be decided is whether th e Respondent has made a
case to compel the Applicant to produce documents listed in the Rule 35 (12) Notice
for the purpose of establishing the validity thereof, to confirm the authority as per Rule
7 (1).
Legal framework
On Satisfactory proof of authority
[28] It is trite that the remedy of a party to legal proceedings who wishes to challenge
the authority of a person allegedly acting on behalf of his purported opponent is as
provided in subrule 7(1) of the Uniform Rules of Court .3
[29] In terms of the subrule the authority of anyone acting on behalf of a party in
legal proceedings may be disputed, whereafter, such a person may no longer act
unless he satisfie s the court that he is so authorized . It is therefore a key requirement
that the person satisfies the court that he is so authorized to act , which can be done
by bringing the Application in terms of subrule 7 (1) or by filing a power of attorney and
or any documentation that will satisfactorily prove such authority to the court . The
authori ty being crucial as it establishes whether a party in legal proceedings is properly
before court .
3 See para 5 Supra
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[30] It is also important to note that in motion proceedings a challenge to the general
authority is separate to the authority to depose to an Affidavit on behalf of a party , and
subrule 7(1) a remedy to a party who wishes to challenge the general authority of a
person who is acting allegedly on behalf of a purported Applicant . This was duly
emphasized in Ganes ,4 and quoting from the judgment ’s headnote5 that:
“In determining the question whether a person has been authorised to institute
and prosecute motion proceedings, it is irrelevant whether such person was
authorised to depose to the founding affidavit. The deponent to an affidavit
in motion proceed ings need not be authorised by the party concerned to
depose to the affidavit. It is the institution of the proceedings and the
prosecution thereof that must be authorised. Thus, where, as in the present
case, the motion proceedings were instituted and pro secuted by a firm of
attorneys purporting to act on behalf of the applicant and in an affidavit filed
with the notice of motion, it was stated by the deponent thereto that he was a
director in the firm of attorneys acting on behalf of the applicant and tha t such
firm of attorneys was duly appointed to represent the applicant and such
statement is not challenged by the respondent, it must be accepted that the
institution of the proceedings was duly authorised. Such a finding will be
strengthened if the respo ndent does not avail himself of the procedure provided
by Rule 7 of the Uniform Rules of Court. (Paragraph [19] at 624G/H - 625A.) “
[31] It is noted that the confirmation of such authority not necessarily corroborated
by the Applicant but however found to be sufficient under the said circumstances.
Fleming DJP in Eskom6 explained the application of the subrule as follows:
‘’the developed view adopted in Rule 7 (1) is that the risk is adequately
managed at a different level. If the attorney is authorized to bring the
Application on behalf of the Applicant, the application necessarily is that of the
Applicant. There is no nee d that any other person, whether he be a witness or
someone who becomes involved especially in the context of authority, should
4 Ganes and Another v Telecom Namibia Ltd 2004 (3) SA 615 (SCA)
5 Also from para 19 of the Judgment
6 Eskom v Soweto City Council 1992(2) SA 703
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additionally be authorized. It is therefore sufficient to know whether or not the
attorney acts with authority .”7 (my emphasis)
[32] In Unlawful Occupiers Unlawful Occupiers, School Site v City of Johannesburg8
one of the arguments raised by the Appellant was the alleged failure by the
Respondent to prove that the depo nent to an affidavit was duly authorized to launch
the Application on its behalf . According to the Municipality ’s resolution the deponent
was authorized to do so in consultation with the Municipality ’s Executive Director:
Corporate Services or Director of Legal Services . The deponent in reply attached a
resolu tion of the Municipality stating that he has consulted with the Executive in
question in respect of the Application. The appellants raised the argument that the
deponent had failed to prove that he had been duly authorised, because he did not
say whether or not the Director of Legal Services agreed with him that the application
should be brought. In that case Brand AJ opined that:
“The issue raised had been decided conclusively in the judgment of Flemming
DJP in Eskom v Soweto City Council 1992 (2) SA 703 (W), which was referred
to with approval by this court in Ganes and another v Telecom Namibia
Ltd 2004 (3) SA 615 (SCA) 624I -625A. The import of the judgment in Eskom is
that the remedy of a respondent who wishes to challenge the authority of a
person allegedly acting on behalf o f the purported applicant, is provided for in
rule 7(1). The ratio decidendi appears from the following dicta (at 705D -H):
'The care displayed in the past about proof of authority was rational. It was
inspired by the fear that a person may deny that he was party to litigation carried
on in his name. His signature to the process, or when that does not eventuate,
formal proof of authority would avoid undue risk to the opposite party, to the
administration of justice and sometimes even to his own attorney. ...
The developed view, adopted in Court Rule 7(1), is that the risk is adequately
managed on a different level. If the attorney is authorised to bring the
application on behalf of the applicant, the application necessarily is that of the
applicant. There is no need that any other person, whether he be a witness or
someone who becomes involved especially in the context of authority, should
additionally be authorised. It is therefore sufficient to know whether or not the
7 At 705 D -H
8 Unlawful Occupiers, School Site v City of Johannesburg 2005 (4) SA 199 (SCA) at 207E -H
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attorney acts with authority. As to when and how the attorney's authority should
be proved, the Rule -maker made a policy decision. Perhaps because the risk
is minimal that an attorney will act for a person without authority to do so, proof
is dispensed with except only if the other par ty challenges the authority. See
Rule 7 (1) .”And (at 706B -D):
“ now that the new Rule 7(1) remedy is available, a party who wishes to raise
the issue of authority should not adopt the procedure followed by the appellants
in this matter, i.e. by way of ar gument based on no more than a textual analysis
of the words used by a deponent in an attempt to prove his or her own authority.
This method invariably resulted in a costly and wasteful investigation, which
normally leads to the conclusion that the applica tion was indeed authorised.
After all, there is rarely any motivation for deliberately launching an
unauthorised application. In the present case, for example, the respondent's
challenge resulted in the filing of pages of resolutions annexed to a
supplemen tary affidavit followed by lengthy technical arguments on both sides .
All this culminated in the following question: Is it conceivable that an application
of this magnitude could have been launched on behalf of the municipality with
the knowledge of but ag ainst the advice of its own director of legal services?
That question can, in my view, be answered only in the negative. ” (my
emphasis)
[33] Rule 7 (1) provides a procedure to be followed by a party who wishes to
challenge the authority of an yone who instituted or defended any legal proceedings
on behalf of a client if he was properly or duly instructed by a person authorised to do
so. The instruction does not have to have been issued directly by the Applicant per se
to the attorney but by a person who could validly issue such an instruction and by
which the Applicant is to be validly bound . The origin of the instruction therefore being
under scrutiny . If by an agent the court should be satisfied that such agent duly
authorised to institute the proceedings o n behalf of the Applicant. Hence it has been
held that no distinction is to be drawn under the subrule between an atto rney’s
mandate to institute legal proceedings and an aut hority given to an agent by an
artificial person to institute legal p roceedings and an attorney appoint ed in those
circumstances to act on behalf of the A (whereupon the agent ’s mandate to the
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attorney would be binding on the artificial person). Hence reference is made to
resolutions , delegations of authority and substitutions9.
[34] The subrule is consequently to be applied if the authority of anyone acting on
behalf of a party is challenged. It therefore in effect does not limit the challenge to only
the authority of the attorney to act . The wording o f the rule also contemplates a
challenge to the general authority by one person to another to represent him in action
or motion proceedings .10 Contrary to what was found in the Wilge Hervormde
Gemeente case11, that the type of authority that is contemplated by the rule is not a
general authority by one person to another to represent him in legal proceedings.
[35] In Erasmus Superior Court Practice12 reference is made to a decision in the
Western Cape, Cape Division (WCC) and of another in the Limpopo Divisio n,
Polokwane13 where it was held that no distinction is to be drawn under this subrule
between an attorney ’s mandate to institute legal proceedings and an authorisation
given to an agent by an artificial person to institute legal proceedings. Accordingly,
both authoriti es can be challenged under subrule 7 (1).
[36] In Lancaster 101 supra reference is made to South African Allied Workers
Union v De Klerk NO 1990 (3) SA 425 , when Jansen J referred to Mall (Cape) (Pty)
Ltd v Merino Ko -operasie Bpk 1957 (2) SA 347 (C) at 351 D -H, citing Justice
Watermeyer ’s following statement :
“I proceed now to consider the case of an artificial person, like a company or
co-operative society. In such a case there is judicial precedent for holding that
9 Eskom supra
10 Eskom v Soweto City Council Eskom10 1992 (2) SA 703 (W) and in Unlawful Occupiers, School Site v City of
Johannesburg 2005 (4) SA 199 (SCA) at 207E -H
11 Wilge Hervormde Gemeente and Others v Nederduitsch Hervormde Kerk Van Afrika and Another
(5167/2016) [2021] ZAGPPHC 329 (13 May 2021)
12 Volume 2 at D1 -96
13 Lancaster 101 (RF) 9Pty) Ltd v Steinhoff Inte rnational Holding NV 2021 4 All SA 810 (WCC) at para [34]-[35]
and [43] –[44] and Q4 Fuel (Pty) Ltd v Ellisras Brandstof En Olie Verspreiders (Pty) Ltd and Others (HCAA
08/2021) [2021] ZALMPPHC 81 (11 November 2021)
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objection may be taken if there is nothing before Court to show that the
applicant has duly authorised the institution of notice of motion
proceedings. (see for example Royal Worcester Corset Co. v Kesler’s
Stores, 1927 C.P.D. 14 3; Langeberg Ko -operasie Beperk v Folscher and
Another, 1950 (2) S.A. 618 (C)). Unlike an individual, an artificial person can
only function throug h its agents and it can only take decisions by the passing
of resolution in the manner provided by its constitution . An attorney instructed
to commence notice of motion proceedings by, say, the secretary or general
manager of a company would not necessarily know whether the company had
resolved to do so, nor whether the necessary formalities had been complied
with in regard to the passing of the resolution. It seems to me, therefore, that
in the case of an artificial person there is more room for mistakes to occur and
less reason to presume that it is properly before the Court or that proceedings
which purport to be brought in its name have in fact been authorised by it . There
is a considerable amount of authority for the proposition that, where a company
commences proceedings by way of petition, it must appear that the person who
makes the petition on behalf of the company is duly authorised by the company
to do so (see for example Lurie Brothers Ltd v Archache, 1927 N.P.D 139 , and
the other cases mentioned in Herbstein and van Winsen, Civil Practice of the
Superior Courts in South Africa, at pp. 37, 38). This seems to me to be a
salutary rule and one which should apply also to notice of motion proceedings
where the applicant is an artificial person. In such cases some evidence should
be placed before the Court to show that the applicant has duly resolved to
institute the proceedings and that the proce edings are instituted at its
instance. (“own emphasis”)
[44] Given the above, I am not persuaded by Lancaster 101’s argument that
a distinction is to be drawn between an attorney’s mandate to act, and an
authorisation given to an agent that he or she is so authorised by the artificial
person, to so act, in this case, to institute legal proceedings .
[37] In case of an artificial person , verifi able information on the origin of the agent’s
mandate to establish its authenticity is therefore crucial . The inquisition being whether
satisfactory evidence has been placed before the Court to show that the Applicant has
duly authorised the institution of the legal proceedings , which is what I find th e
18 | P a g e
challenge in casu to be all about . Can the agent ’s authority be traced back to the
Applicant thus a conclusion be made that the agent was so authorised to institute the
legal proceedings on behalf of the Applicant .
[38] The Respondent ’s challenge o n the authority of Mowana and DMA ’s is from
that perspective . The Respondent in actual fact disput es Mowana ’s (referred to as a
sub agent of the Respondent) representation of the Applicant as an agent to institute
the proceedings against it on behalf of the Applicant , in that regard disagreeing that
DMA duly mandated to institute the legal proceedings on behalf of Applicant . It then
argue d that there is nothing or no sufficient proof that Mowana ’s authority originates
from the Applicant or that Applicant agrees to the authority of DMA . In furtherance of
that point the Respondent further stated that it is not for the agent to proclaim that he or
she is authori zed but for proof to be produced from the Applicant confirming the agent ’s
authority . Such proclamation was indicated to be sufficient in Unlawful Occupiers, if Rule
7 (1) is not invoked .
[39] On the information and documentation submitted by the Applicant, the
Respondent went further to allege that as far as it is concerned the Applicant might not
even be aware of the Application and therefore it disputes that Ramahushi who has
deposed to the Authority Affidavit was duly authorised to do so by the Applicant . In that
regard the Respondent cast its net so far with the hope of catching something. The
objection wider than when it was initially brought up in its Rule 7 (1) Notice. These are two
more issues that Respondent added which can be summarily disposed that do not
have to affect the merits of the case.
[40] Regarding Respondent ’s contention against Ramahushi ’s authority to depose
to the Affidavit , it is irrelevant whether or not Ramahushi is authorised by the Applicant
to depose to the Affidavit as upheld in Ganes and Eskom . The deponent to an affidavit
in motion proceedings need not be authorised by the party concerned to depose to
the affidavit on the facts relating to the issue between the parties . It is the institution of
the proceedings and the prosecution thereof that must be authorised.14
14 See footnote 5 supra
19 | P a g e
[41] Nevertheless, Ramahushi , as a managing director of Mowana was duly
authorised by resolution of Mowana , to act in its representative capacity as the alleged
agent of the Applicant , to attest to Mowani ’s authority as delegated to it by the PIC,
the Applicant ’s primary agent, to represent the Applicant in the management of the
Applicant ’s property portfolio . In that case authorised to perform the legal acts relating
to the property on behalf of the Applicant. Further more, he was to confirm Mowana ’s
resolution taken in exercising its delegated authority , to instruct DMA to institute the
related legal proceedings on behalf of the Applicant . That was the relevancy of
Ramahushi ’s Affidavit , to depose to the facts or evidence that prove that the institution
of the proceedings in line with its authority as delegated to it by the PIC. In addition , to
attest to the fact that PIC duly authorised to delegate its authority to represent the
Applicant as granted to it by the Applicant. The relevant documents were submitted to
prove the authenticity of the mandate. It is not expected that DMA would have been
aware of these facts and unfair to have expected it to deliberate extensively on its
appointment . The point on the authority to depose to the affidavit was however not
persisted with in the heads of argument therefore regarded to be of no consequence
to the dorminant issue of authority.
[42] The contention that there is nothing that indicates that DMA ’s mandate
originates from the Applicant in that there is no docu ment or affidavit deposed to b y an
officer or representative of the Applicant that confirms or proves that Applicant agrees
to the authority of DMA , a situation the Respondent alleges r aises a suspicion that the
Applica nt probably not a ware of the Application , is unsustainable. The Respondent is
being pretentio us alleging to susp ect that Applicant might not be aware of the
Application as such allegation is made notwithstanding that its attorney served the
documents on the Application and the correspondence in relation thereto on the
Applicant . Mr Kahn continued advertently to serve further interlocutory notices ,
including an exception and a Rule 35 (12) on the Applicant , DMA and Mowana , after
having challeng ed DMA ’s authority . It is important that the challenge to authority be in
good faith.
.
[43] As to the contention on the absence of a document or affidavit emanating from
the Applicant ’s officials confirming or agreeing to Mowana ’s and DMA ’s authority to act
on its behalf , the requirement a ccording to subrule 7 (1) is that the person whose
20 | P a g e
authority is challenged has to satisfy the court that he is so authorized at the time when
the objection is raised . The Respondent initial ly challenge d only DMA ’s authority , DMA
expectant then to satisfy the court of its authority . However , the Respondent then
amplified its challenge in its answering affidavit to include Mowana , and questioning
the terms of the PMA. It also, due to absence of any direct authorization from the
Applicant, questioned the PIC ’s authority to represent the Applicant and to delegate
such authority . In so doing it e ffectively was disputing if Mowana was validly vested
with any authority to act on behalf of the Applicant in instituting the action against the
Respondent.
[44] I find it difficult to understand the Respondent ’s contention on the authority of
the PIC and its power to delegate such authority when it has agreed that ’the PIC is
an investment manager of the Applicant ’s property portfolio duly appointed as such by
the Applicant, pursuant to its funct ions as an asset management firm , vested with the
authority to represent and act as the Applicant ’s agent, in the manag ement of the
Applicant ’s property portfolio . Besides, the confirmatory affidavit of the PIC ’s COO ,
Mr Heko confirms PIC ’s authority to i nvolve the Applicant in litigation with power to
delegate such authority , which authority he confirm s to have been delegated by the
PIC to Mowana. These facts have not been disputed. Further that the PIC outsourced
the whole of its property management func tion in relation to the Applicant ’s property
portfolio to Mowana in terms of the PMA, and a lso that Mowana is in terms of the PMA
authorised to represent the Applicant in all matters relating to the immovable property
owned by the Applicant including the t wo properties, to take any legal steps necessary
in relation to the rental enterprise in the name of the Applicant in any court of law, sign
any documents or affidavits to give effect to the action. The relevant extracts of the
contract that refers to PIC’s power to delegate its authority in the management of the
Applicant ’s property folio disclosed , together with the delegation of authority matrix on
the appointment of attorneys that sets out the function of approving the selection.
[45] Mowana ha s in turn by resolution taken by its directors in the exercise of the
authority delegated to it by the PIC, explicitly authorised DMA so to act in the matter
and institute the action and Ramahushi to depose to any affidavit necessary. The
resolution was ta ken by the directors in office at the time , as confirmed by Ramahushi
that Mowani had only three directors at the time when the resolution was signed.
21 | P a g e
[46] Furthermore, it is further clear that, even if the authority was not in place when
the litigation commenced, actions taken can be ratified subsequently. Where authority
is challenged in the answering affidavit, it is permissible to make out a case in reply.
This was ful ly dealt with in Smith v KwaNonqubela Town Council . 15 The Applicant, as
a party is entitled to do in reply, respond ed to the issues raised in the answering
affidavit regarding the absence of a document or communication from the Applicant
confirming the authority , by attaching a letter dated 3 May 2021 from the Applicant ’s
Principal Executive Officer . The letter confirms the PIC ’s authority to represent the
Applicant. It reads “the GEPF has instructed the PIC and or its managing agent, bei ng
Mowana properties to appoint attorneys to act on behalf of GEPF in taking the
necessary legal steps to recover and collect arrear rental due by Gijima Holdings Pty
Ltd in respect of it s leasing and occupying space in immovable property belonging to
the GEPF .”
[47] The evidence and the document s submitted should then be sufficient to prove
the authority matrix applicable . It can be accepted that finally the representative
authority of Mowana and DMA ’s mandate to institute the proceedings on behalf of the
Applicants is confirmed . Moreover , since the factual allegations on such authority are
not only confirmed under oath by Hako the COO of PIC and Ramahushi, Mowana ’s
managing director, but also by Mr Pillay , a director at DMA, and the pertinent official
from the Applicant , plus the material extracts from the agreement attached . I am
satisfied that there is satisfactory evidence that Mowana duly authorized to represent
the Applicant and in that regard to have on Applicant ’s beh alf properly and duly
mandate d DMA to institute the action on behalf of the Applicant
[48] The persistence to demand the discovery of the PMA and the agreement
between PIC and Applicant for the purpose of finding out if the dispute on authority
can be sustained is unreasonable and cannot be permissible in these proceedings. It
is a fishing expedition since the relevant extracts therefrom were submitted and do
suffice , considering the reasons proffered for not furnishing the whole agreement .
15 Smith v KwaNonqubela Town Council [2] (399/97) [1999] ZASCA 58; [1999] 4 All SA 331 (A) (10 September
1999)
22 | P a g e
More so e specially since there is no genuine contention on PIC’s authority to act and
bind the Applicant. The evidence placed before the Court show and confirm the
Applicant ’s resolve that the legal proceedings pertaining to the management of i ts
property folio as outsourced to the PIC be instituted at its instance.
[49] In any event, Rule 7 (1) provides a procedure to be followed by a party who
wishes to challenge the authority of an yone who instituted or defended any legal
proceedings on behalf of a client if he was properly or duly instructed by a person
authorised to do so. It is the instruction that is under scrutiny if it emanated from a
person who could validly issue such an instruction on behalf of the Applicant and by
which the Applicant is to be legally bound. The evidence doe s show that the Applicant
has duly resolved to institute the proceedings and that the agents were duly authorized
to institute t he proceedings at its instance.
[50] In casu , replying to the Respondent ’s query on DMA ’s authority, as DMA would
not be aware if the Applicant had indeed resolved to institute the proceedings ,
Ramahushi ’s Affidavit was filed in his capacity as the managing director of Mowana,
the management agent representing the Applicant, to place evidence before the court
or attest to th e fact that PIC ’s authority to institute legal proceedings in the
management of the Applicant ’s property portfolio had been delegated to Mowana.
Further that as the Applicant ’s sub agent it had by resolution authorised DMA ’s
appointment to act on behalf of the Applicant and institute the action and Ramahushi ’
to depose to the Authority Affidavit. In the Affidavits Ramahushi explained that as a
property management agent Mowana had concluded a PMA agreement with the PIC
in terms of which PIC delegated to Mowa na the authority to represent and manage the
Applicant ’s property folio, which delegation included the authority to appoint attorneys
to litigate on behalf of the Applicant. The Affidavit also made reference to the relevant
clauses, detailing the delegatio n matrix -. The most important fact being the binding
effect of PIC actions on the Applicant and the authority to delegate.
[51] The pointless insistence to access to the PMA so as to verify PIC’s authority to
delegat e the power to instruct the attorneys on behalf of the Applicants , when t he
Respondent has accepted that the PIC is an agent of the Applicant with vested
authority to appoint attorneys and that the PIC ’s actions binding on the Applicant was
23 | P a g e
absurd . More so because the Re spondent has been furnished with extracts of the
relevant clauses in the PMA. It has failed to proffer a meaningful challenge to the PIC’s
authority to delegate its mandate . Finally , on Kahn ’s demand of proof of the validity of
the agreements entered into between the Applicant, PIC and Mowana, the
Respondent had correctly argue d that Kahn makes the demand without tendering
proof for his perception that the agreements might be invalid. Equally Kahn ’s Rule 35
(12) request of the PMA indeed a fishing expedition as the extract of the relevant
provisions in the agreement expressly set out the appointment and authority of
Mowana . The document is certified by Mowana ’s company secretary and co nfirmed
under oath. As per Gainsford NNO v Hiab AB 2000 (3) SA 635 (W), the subrule does
not prescribe the method of establishing authority where such authority is challenged.
No obligation is placed on the court to investigate the validity of past acts in the context
of the authority to act:
Rule 35 (12)
[52] In relation to Rule 35 (12), the r emedy of a respondent who wishes to challenge
the authority of a person allegedly acting on behalf of a purported applicant is as
provided in rule 7(1) – party not entitled to production of documents to challenge
authority in the affidavits in the main application. The court will n ot make an order
under Rule 35 (12) against a party to produce document s that cannot be produced, or
are privileged or irrelevant but importantly that are required for a mere fishing
expedition .16
Costs
[53] The attorney and client cost order cannot be considered as the Applicant was
supposed to make its case for such costs in the Founding Affidavit to give the
Respondent an opportunity to respond. It instead endeavoured to makes a case for
such costs in the replying affidavit.
[54] Under the circumstances the following order is made:
16