And
Luvhomba Financial Services CC Defendant/Respondent
(Registration Number: 2003/048903/223)
This judgment is issued by the Judge whose name is reflected herein and is
submitted electronically to the parties/their legal representatives by email.
The judgment is further uploaded to the electronic file of this matter on
CaseLines by the Judge or her Secretary. The date of this judgment is deemed
to be 11 April 2025.
JUDGMENT
COLLIS J
INTRODUCTION
[1] This is an opposed summary judgment in terms of which the Plaintiff seeks
the following relief:
1.1. Payment of the amount of R1,281,969.78;
1.2. Payment of interest on the amount of R1,281,969.78 at a rate of
10.990% per annum from 5 April 2015 to date of payment, both dates
inclusive;
2. Payment of the monthly insurance premiums of R289,39;
3. That the immovable property described as Portion 4 of Erf 3269, Louis
Trichardt Extension 11 Township, Registration Division L.S, Province of
Limpopo, measuring 297 (two hundred and ninety -seven) square
metres, held by deed of transfer number T49723/2013, subject to the
conditions therein contained (“the property”) be declared executable for
the aforesaid amounts;
4. An order authori zing the plaintiff to execute against the property as
envisaged in Rule 46(1)(a)(ii) of the Uniform Rules of Court;
5. Costs on the scale as between attorney and client.
[2] The relief sought by the Plaintiff is premise d on a loan agreement
concluded between the parties which was breached by the Defendant leading
to the Plaintiff instituting action proceedings against the Defendant.
[3] Pursuant to the action being instituted , the summons was served on the
Defendant’s registered business address which is also the Defendant’s chosen
domicilium address on 8 July 2015 . Thereafter, t he Defendant delivered a
Notice of Intention to Defend on 10 July 2015 . The Plaintiff then withdrew its
Default Judgment application and called for the delivery of the Plea on 30
November 2023 . The Plea was delivered on 6 March 2024 and in terms of Rule
32(2) the summary judgment application was then launched.
BACKGROUND FACTS
[4] On 30 April 2013, the plaintiff and the defendant concluded a written home
loan agreement.1
1 Application for summary judgment: 006 -7, para 5.1.
[5] Pursuant to the conclusion of the home loan agreement, the Defendant
caused a mortgage bond to be registered in favour of th e Plaintiff over the
property. 2
[6] The Defendant defaulted on payment of the home loan account . As a result
of this breach the Defendant ow ed the Plaintiff as of 5 April 2015 , an amount
of R1,281,969.78 plus interest at a rate of 10.990% from 5 April 2015
together with monthly insurance premiums in the amount of R298.39.3 As per
the updated Certificate of Balance, this amount has since increased to R
2 899 568.26.4
[7] The Plaintiff then caused notices in terms of section 129 of the National
Credit Act 34 of 2005 to be issue d and served on the Defendant ,5 with
summons ultimately being issued against the Defendant on 12 May 2015. The
summons was served on the Defendant on 8 July 2015 this at its’ chosen
domicilium citandi et executandi.6
2 Application for summary judgment: 006 -7, para 7.
3 Application for summary judgment: 006 -8, para 9.
4 Updated COB 015 -2.
5 Application for summary judgment: 006 -8, para 10.
6 Application for summary judgment: 006 -8, para 12.
[8] On 10 July 2015 the Defendant served a notice of intention to defend the
action and in the absence of the Defendant filing a plea, the Plaintiff then
applied for default judgment which application was later withdrawn on 30
November 2023 in order to allow the Defendant an opportunity to file a plea.7
[9] As mentioned , the defendant filed its plea on 6 March 2024 , which raise d
only one defen ce namely , that the defendant cited in the action is incorrect as
such defendant does not exist. According to the defendant, its name is
Luvhomba Financial Services (Pty) Ltd and not Luvhomba Financial Services
CC. The defendant contends that it has no relationship or business with the
plaintiff and that the plaintif f therefore is suing the incorrect party.8
[10] At the hearing Mr. Matthews Mulaud zi appeared in person on behalf of
the defendant. He informed this Court that he is a member of the defendant
and on this basis could appear on behalf of the defendant.
[11] His right of appearance on behalf of the defendant, was rightly challenged
by the plaintiff.
7 Application for summary judgment: 006 -9, para 14.
8 Defendant’s plea: 005 -2, para 7.
[12] On its behalf it was argued that the defendant is a close corporation and
that Mr. Mulaudzi appearing on behalf of the defendant is not a legal
representative . As such it was argued that he therefore does not h ave right of
appearance to represent the defendant before this Court.
[13] Now it is trite that a company is a legal person a and it cannot appear in
person. A company, and similarly a close corporation, must be represented by
a duly admitted attorney or advocate.9
[14] In the decision of Manong10 the Su preme Court of Appeal confirmed the
principle laid down in Yates Investments and further held that Superior Courts
have a residual discretion to grant leave to a corporation to carry on in
proceeding s otherwise with the assistance of a legal representative.
[15] Therefore, in order for the Court to allow a corporation to be represented
in a Superior Court without legal representation, there must be leave sought
9 Yates Investments (Pty) Ltd v Commissioner for Inland Revenue 1956 (1) SA 364
(A).
10 Manong & Associates (Pty) Ltd v Minister of Public Works and Another 2010 (2)
SA 167 (SCA).
by way of a properly motivated formal application which shows good cause on
why the rule prohibiting non -professional representation should be relaxed.
[16] In the present proceedings t he defendant has not ma ke such a formal
application to appear on behalf of the defendant . Consequently, the plaintiff
had argued that the defendant is not properly before Court.
[17] In the absence of such an application, this Court is not persuaded that
Mr. Mulaudzi had right of appearance to appear on behalf of the defendant,
and consequently, the preliminary point as raised by the plaintiff is found to
be sound and that it has merit.
THE LAW
[18] Rule 32 of the Uniform Court Rules sets out the procedure for an
application for summary judgment.
[19] Rule 32(2)(a) provides the following:
“(a) Within 15 days after the date of delivery of the plea, the plaintiff
shall deliver a notice of application for summary judgment, together
with an affidavit made by the plaintiff or by any other person who can
swear positively to the facts.
(b) The plaintiff shall, in the affidavit referred to in subrule (2)(a), verify
the cause of action and the amount, if any, claimed, and identify any
point of law relied upon and the facts upon which the plaintiff’s claim is
based, and explain briefly why the defence as pleaded does not raise
any issue for trial.”
[20] From a procedural point of view the plaintiff has complied with the
provisions of the Rule in that:
20.1 The application was brought on 28 March 2024, this within 15 days
after the defendant served its plea;
20.2 The affidavit was deposed to by a person who can swear positively
to the facts of the matter and has verified the cause of action and the
amou nt claimed from the defendant;11 and
20.3 The plaintiff has stipulated the points of law relied upon and the
facts upon which its claim is based and why the defence raised by the
defendant does not raise any issue for trial.12
[21] Rule 32 was designed to prevent a plaintiff’s claim, based upon certain
causes of action, from being delayed by what amounts to an abuse of the
process of the court. In certain circumstances, therefore, the law allows the
plaintiff to apply to court for judgment to be entered summarily against the
defendant, thus disposing of the matter without putting the plaintiff to the
expense of a trial.13
[22] To the matter at hand, t he plaintiff’s application for summary judgment
seeks to achieve the exact objective of the Rule being to prevent the plaintiff’s
action from being delayed even further by an abuse of Court processes.
11 Application for summary judgment: 006 -6, para 4.
12 Application for summary judgment: 006 -7 to 006 -12, para 5 to 25.
13 Van Loggerenberg and Bertelsmann Erasmus: Superior Court Practice RS 22, 2023,
D1 Rule 32 -14.
LACK OF BONA FIDE DEFENCE
[23] In its plea , the defence raised by the defendant is that the plaintiff sued
the incorrect party as the defendant is a private company and not a close
corporation as cited.
[24] Herein, t he loan agreement annexed to the plaintiff’s particulars of claim
as annexure “X”, set s out that the loan agreement was entered into between
the plaintiff and an entity known as “Luvhomba Financial Service CC” with
registr ation number “2003 -048903 -23”.14
[25] Ex facie this agreement it is clear that at the time when the agreement
was concluded with the defendant , that the defendant was registered as a
close corporation bearing registration number as cited above. The defendant
further remained registered as such when the plaintiff first instituted the
action proceedings against the defendant.15
[26] As per the affidavit filed in support of th is application, t he plaintiff
conducted a search on the Companies and Intellectual Property Commission
14 Plaintiff’s particulars of claim: 001 -16.
15 Affidavit in support of summary judgment: 006 -10, para 19.
system, which search confirms that the defendant is still registered as a close
corporation. As such there is no evidence that the defendant converted from
a close corporation to a private company and further the defendant has failed
to provide any evidence to the effect that it is a private company and not a
close corporation .16
[27] In the absence of such rebuttal evidence being placed before this Court,
it must be accepted that the defendant is a close corporation and not a private
company.
[28] In its plea the defendant further denies that it entered into any
agreement with the plaintiff. 17 This bear denial is also not supported by any
corroboratory evidence.
[29] Absent such evi dence, this Court therefore accepts that a valid
agreement was concluded between the plaintiff and the defendant and that
the plaintiff is entitled to enforce such agreement against the defendant as
cited.
16 Affidavit in support of summary judgment: 006 -11, para 21 and 22.
17 Defendant’s Plea 005 -2 para 6 .
[30] The defendant it is alleged has failed to make payment on the loan
account for several years and at the time when the application for summary
judgment was brought, the arrears on the defendant’s home loan account had
amounted to R2,865,613.81 and they continue to escalate.18
[31] In the affidavit opposing the application for summary judgment, the
defendant at great lengths makes reference to the sequestrati on of its
member, Mr . Mulaudzi.19 The latter’s sequestration is irrelevant to this action
as the action herein is proceeding against the close corporation of which Mr
Mulaudzi is a member and not Mr . Mulaudzi in his personal capacity. The close
corporation remains a separate legal person from Mr . Mulaudzi.
[32] In support for having sued the close corporation, the plaintiff relied of
the decision Hip Hop Pantsul a Production Close Corporation20 wherein the
defendant in a summary judgment application had argued that Nedbank could
not obtain judgment against the close corporation as the sole member of the
close corporation had been deceased thus the administration of the sole
18 Plaintiff’s Rule 46 supplementary affidavit: 015 -7, para 13.3.
19 Affidavit opposing summary judgment: 017 -4, para 9.
20 Nedbank Limited v Hip Hop Pantsula Production Close Corporation 2022 JDR 1145
(GJ).
member’s estate had to be wound up first. In this decision the Court held that
(at para 7):
“The identity of the defendant is separate from that of its members. The
defendant is a separate legal entity from its members and has legal
rights and responsibilities. It is capable of entering into legally binding
agreements and can sue or be sued in a court of law. The Salmon Rule
has been rigidly applied in our law for over a century, which was devised
by the House of Lords in the matter of Salmon v Salmon & Co Ltd 1897
AC 22; 1895 -99 All ER Rep 33 (HL), where it was held that a company,
duly formed t o take over the business of a person who became the
beneficial owner of all its shares, was nevertheless in law a different
person altogether from that person. In the matter of Francis George Hill
Family Trust v SA Reserve Bank 1992 3 SA 91 (A) at 97 the court held
that "It is trite that a company with limited interest is an independent
legal person and separate from its shareholders or directors.”
[33] The defendant being a separate legal entity from Mr . Mulaudzi is enti tled
to be sued for any breach committed by the defendant. Mr. Mulaudzi is merely
the member of the defendant. The home loan agreement was concluded with
the defendant and the defendant is accordingly the party against whom the
action was brought. As such the sequestration of Mr. Mulaudzi’s remains
irrelevant to th ese proceedings as Mr. Mulaudzi is not the person being sued.
[34] In the opposing affidavit , the deponent further contends that the plaintiff
should have joined the trustees appointed subsequent to his sequestration .
This argument however holds no water as the proceedings was initiated
against the defendant -close corporation and not against Mr. Mulaudzi in his
personal capacity .
[35] The wrong party having been sued as contended for by the defendant is
the only defence raised by the defendant, and as already mentioned this
defence is meritless.
[36] As the defendant has failed to discharge the onus which the Rule requires
it to meet, i.e. that it has a bona fide defence which raises issues to be
determined at trial it must therefore follow, that the plaintiff would be entitled
to the relief which it seeks.
COSTS
[37] In its Particulars of Claim, the plaintiff seeks costs on an attorney and
client scale as provided for in the underlying mortgage bond21 in the event of
any default on the part of the defendant. This Court is satisfied to award the
plaintiff such costs as it is the successful party herein .
[38] Consequently, summary judgment is entered in favour of the Plaintiff
against the Defendant for:
38.1 Payment of the amount of R2,899,568.26;
38.2 Payment of interest on the amount of R2,899,568.26 at the rate of
13.240% per annum from 25 October 2024 to date of payment both dates
inclusive.
38.3 The immovable property described as:
PORTION 4 OF ERF 3269, LOUIS TRICHARDT EXTENSION 11 TOWNSHIP,
REGISTRATION DIVISION L.S., PROVINCE OF LIMPOPO, MEAUSURING 297
(TWO HUNDRED AND NINETY SEVEN) SQUARE METRES, HELD BY DEED OF
21 Mortgage bond: 001 -35, clause 1.1.3.
TRANSFER NUMBER T49723/2013, SUBJECT TO THE CONDITIONS THEREIN
CONTAINED.
(“the Property”)
is declared executable for the aforesa id amounts.
38.4 The Registrar is authori zed to issue a writ of execution in terms of Rule
46 as read with Rule 46A for the attachment of the Property.
38.5 The sale of the Property in execution shall be subject to a reserve price
set as R1 191 179.70.
38.6 A copy of this order is to be served on the Defendant, as soon as
practicable after this order is granted, but prior to the sale -in-execution.
38.7 The Defendant may prevent the sale of the property referred to in this
Order if the Defendant pays to the Plaintiff the arrear amount owing to the
Plaintiff, together with the Plaintiff’s permitted summary judgment charges
and reasonable costs of enforcing the agreement up to the time of re -
instatement, prior to the property being sold in execution.
38.8 The Defendant is advised that the arrear amount is not the full amount
of the judgment debt, but the amount owing by the Defendant to the Plaintiff,
without reference to the accelerated amount.
38.9 The arrear amount, enforcement costs and summary judgment referred
to in this Order may be obtained from the Plaintiff.
38.10 The Defendant are advised that the provisions of section 129(3) and
(4) of the National Credit Act, Act 34 of 2005 may apply to the Judgment
granted in favour of the Plaintiff.
38.11 The Defendant shall pay the costs of the action on a scale as between
attorney and client.