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IN THE HIGH COURT OF SOUTH AFRICA
(EASTERN CAPE DIVISION, MAKHANDA)
Not reportable
CASE NO. 1600/2022
In the matter between:
NEDBANK LIMITED Applicant
and
UMVOTI TRADERS 1006 CC First respondent
SKHUMBUZO ATWELL ZUMA Second respondent
______________________________________________________________________
JUDGMENT
______________________________________________________________________
LAING J
[1] This is an application for an order to declare executable the immovable property
situated at […] C[…] Place, Blue Bend, East London (‘the property’) . The applicant also
seeks the setting of a reserve price.
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Background
[2] On 13 September 2017, the applicant and first respondent concluded a written
home loan agreement. As security for its indebtedness, the first respondent arranged for
the registration of a covering mortgage bond in the amount of R 3,125,000 and the
hypothec ation of the property . The first respondent breached the agreement . It owe d the
sum of R 2,697,213 at the time that the applicant launched the present application; the
debt attracts considerable interest .1 On 17 January 2023 , the applicant obtained
judgment against the first respondent and instructed the sheriff to attach. This resulted
in a nulla bona return .
[3] For immediate purposes, t he applicant set out the details required under rule
46A(5) of the Uniform Rules of Court ( ‘URC’) , indicating that the market value of the
property was R 2,000,000 and the municipal value somewhat lower. It alleged that t he
first respondent owed an amount of R 22,390 for municipal rates and service charges
and contended that a reserve price of R 1,047,000 would be appropriate . The applicant
also stated that it had invited the first respondent to participate in its Nedbank Assisted
Sales programme, in terms of which an owner agree d to the applicant’s marketing and
selling of his or her immovable property ; if the property was sold, then the owner
qualif ied for a discount on the amount still owed under the home loan agreement and
could arrange for payment of the outstanding debt on favour able terms. The first
respondent has , so far, declined to accept the invitation.
[4] The second respondent is the sole member of the first respondent. He alleged
that the property was his primary residence and the home of his wife and three
children . He also averred that he had requested the applicant to accept a proposa l for
settle ment of the arrears on the strength of ‘two lucrative contracts’ that the first
respondent had secured; he had paid an amount o f R 21,886 on 27 February 2023 as
an indication of his commitment to the proposal . The applicant had rejected it. The
1 At the time that the application was brought, interest was charged at prime plus 1.11 %, which amounted
to 12.36 % per annum.
second respondent went on to state that he had found permanent employment as a
project manager at the Khonzinkosi Spar, Tugela Ferry , earning a nett salary of R
45,020 per month ; he was in a better financial position than previously . He confirmed
that the first respondent had no intention to accept the invitation to participate in the
Nedbank Assisted Sales programme; it remained its intention, however, to settle the
debt and to apply for the rescission of the judgment already obtained by the applicant.
Issues to be decided
[5] The main issue to be decide d is whether the applicant has satisfied the
requirements of rule 46A of the URC. More specifically, the court must determine
whether the evidence provided by the applicant and the submissions made by the
second respondent justify the relief sought.
[6] A brief overview of the relevant principles is set out below.
Legal framework
[7] In Nedbank Ltd v Bestbier (Scholtz Intervening) ,2 the court held that rule 46A
provides for judicial oversight to ensure the protection of the constitutional right to
adequate housing.3 Sub-rule (1) thereof stipulates that the rule applies whenever an
execution creditor seeks to execute against the residential property of a judgment
debtor.
[8] Prior to the introduction or rule 46A,4 the provisions of rule 46(1)(a) stipulated,
inter alia , that no writ of execution against immovable property could be issued until a
court had declared the property to be specially executable . The proviso to this was that
where the property was the primary residence of the judgment debtor , the writ could not
2 Unreported, WCC case no. 12654/18, dated 17 September 2020.
3 At paragraphs [39] -[43]. The decision was confirmed on appeal in Bestbier v Nedbank Ltd (unreported,
SCA case no. 150/2021, dated 13 June 2022).
4 Rule 46A came into operation 22 December 2017.
be issued unless the court had considered ‘all of the relevant circumstances’ before
ordering such execution .
[9] The Constitutional Court provided examples of such circumstances in Jaftha v
Schoeman and Others ; Van Rooyen v Stoltz and Others ,5 which Van Loggerenberg
summarised as follows:
‘(a) whether the rules of court have been complied with ;
(b) whether there are other reasonable ways in which the judgment debt can
be paid;
(c) whether there is any disproportionality between execution and other
possible means to exact payment of the judgment debt;
(d) the circumstances in which the judgment debt was incurred;
(e) attempts made by the judgment debtor to pay off the debt;
(f) the financial position of the parties;
(g) the amount of the judgment debt;
(h) whether the judgment debtor is employed or has a source of income to
pay off the debt ;
(i) any other factors relevant to the case.’6
[10] The learned writer pointed out , with reference to Gundwana v Steko
Development ,7 that the Constitutional Court had added the following to the
circumstances listed above:
‘It is only when there is a disproportionality between the means used in the
execution process to exact payment of the judgment debt, compared to other
available means to attain the same purpose , that alarm bells should start ringing.
5 2005 (2) SA 140 (CC) , at 161I-163B .
6 Van Loggerenber g, Erasmus: Superior Court Practice (vol 2, 2ed, Juta, service 5, 2017) , at D1 -631-2.
7 2011 (3) SA 608 (CC), at 626F -G.
If there are no other proportionate means to attain the same end, execution may
not be avoided.’8
[11] The above principles constitute a rudimentary framework for the determination of
the matter. This will be discussed in the paragraphs that follow .
Discussion
[12] As a starting point, it is necessary to emphasise that the sheriff ’s attempt to
execute the judgment by attachment of the first respondent’s movable assets resulted in
a nulla bona return . In Basson v Basson and Another ,9 Norman J observed that the
effect of a nulla bona return was to alter the status of a debtor to that of an insolvent; it
also resulted in the encroachment upon a debtor’s right not to be deprived of their
property without due process. The learned judge went on to describe it as a ‘gateway’ to
the debtor’s loss of his or her residential home.10
[13] In the present matter, the second respondent has relied extensively on the
undisputed fact that the property is his primary residence and serves as a home for his
wife and three children. He has also relied on the undisputed fact that he has found
permanent employment a s a project manager, earning a salary that would be sufficient
to pay the first respondent’s arrears and to settle its debt without need for the sale of the
property in execution. These are facts that must be considered .
[14] In Changing Tides 17 (Pty) Ltd NO v Frasenburg ,11 however, Rogers J held that:
‘In making the rule 46A assessment, the prospect of the judgment debt being
satisfied without recourse to the mortgaged property has to be investigated. If a
debtor is substantially in arrears and fails to place information before court
8 Van Loggeren berg, at D1 -632.
9 (260/2019) [2022] ZAECMKHC 85 (25 October 2022) .
10 At paragraph [39].
11 2020 JDR 1430 (WCC).
pointing to the existence of other assets from which the indebtedness might be
satisfied, a court would generally be justified in proceeding on the basis that
execution against the mortgaged property is the only means of satisfying the
mortgagee’s claim.’12
[15] The court can only determine a matter based on the evidence placed before it .
Rule 46A (5) enjoins the applicant to ensure that its application is supported by
documents that deal with the aspects listed under sub -rules (a) to (f) .13 Furthermore,
rule 46A (6)(b)(ii) enjoins the respondent , when opposing the application, to set out the
reasons for his or her opposition and the grounds upon which he or she opposes the
relief sought . Provided that the applicant has made out a case for execution against the
residential immovable property of the respondent , the court may , in the absence of
evidence that there is any other satisfactory means by which to satisfy the judgment
debt, order execution against the respondent’s primary residence. The duty to place
before the court such facts as might militate against such an order lies with the
respondent. If the respondent fails to do so, then a court may indeed proceed on the
basis that no acceptable alternatives are available.
[16] Returning to the present matter, the second respondent has not provided
essential information regarding his personal circumstances . The ages of his children are
unknown, his wife’s employment status and income -earning capacity are unknown.
From the salary advice attached to the second respondent’s papers, it i s apparent that
he commenced employment at the Khon zinkosi Spar on 1 April 2022 . Why he did not
use his salary to settle the first respondent’s arrears before the applicant obtained
judgment on 17 January 2023 was not explained. Similarly, the second respondent
seems to have made only a single payment of R 21,886 thereafter , notwithstanding the
express intention of addressing the first respondent’s indebtedness by way of a duly
structured repayment plan . This was also not explained. On the same date, he
mentioned that the first respondent had secured projects that would generate additional
12 At paragraph [51].
13 The court may, of course , call for any other document which it considers necessary. See rule 46A(5).
income . Some six months later, on 29 August 2023, it was clear that the first respondent
had yet to commence work on the projects ; they were, nevertheless, described as
‘lucrative’. This, too, was not explained.
[17] From the second respondent’s papers, he indicated to the applicant on 1
September 2023 that he would be able to afford payments of R 20,000 to R 25,000 per
month.14 This represent ed, however, an amount only marginally higher than what the
first respondent was required to pay in terms of the monthly instalments under the home
loan agreement . It d id not account for the settlement of its arrears. Unsurprisingly, the
applicant rejected the proposal on 4 September 2023. If the first respondent’s failure to
comply with its contractual obligations , notwithstanding the second respondent’s
employment at the Khonzinkosi Spar since 1 April 2022 , as well as its failure to have
taken any further meaningful steps to settle the arrears since the single payment made
by the second respondent on 27 February 2023, then the renewed offer to pay R 20,000
per month (submitted by counsel in argument ) rings hollow.
[18] Quite simply, the second respondent has failed to place any evidence before the
court to persuade it that there are other means by which to satisfy the judgment debt.
No further movable assets have been identified. Moreover, t he second respondent’s
proposa l, as detailed above, is plainly unacceptable. There is no reason why the court
should not order execution against the first respondent’s property.
Reserve price
[19] In terms of rule 46A(9), the court must consider whether a reserve price is to be
set. The applicant has supplied details of the market value, and the amount owed for
municipal rates and service charges . It has also indicated the extent of the first
respondent’s arrears when the applicant launch ed the present application, which was
substantial (R 2,639,21 3) and which would have increased not in considerably during the
14 Counsel submitted, in heads of argument, that the second respondent was willing to pay a monthly
amount of R 20,000.
intervening period . Considering such arrears, it cannot be said that any equity would be
realised were the property to be sold even at the market value supplied (R 2,000,000) ;
the extent of the first respondent’s indebted ness is too great.
[20] Whereas the property might well be occupied by the second respondent’s family,
too little evide nce has been presented to indicate why the sale of the property at a
reserve price would cause undue hardship. If anything, then the second respondent’s
income seems to be sufficient to pay for the lease of alternative accommodation.15
Furthermore, the applicant’s valuation report is favourable and indicates that there
would be a reasonable demand for the property .
[21] If the method adopted by the court in Firstrand Bank Ltd v Meyer16 is applied in
the present matter , then a reserve price of R 1,377,610 is achieved . The amount
represent s the forced sale value, calculat ed as 70% of the market value , less
outstanding municipal rates and service charges . This is higher than that proposed by
the applicant but would seem to be fair to the parties involved. The determination of a
reserve price is, after all, not an exact science.17
Relief and order
[22] The court is persuaded that the applicant has met the requirements of rule 46A.
The second respondent has failed to advance sufficient evidence to demonstrate that
there are acceptable alternatives to execution against the resident ial immovable
property in question. In accordance with the relevant princi ple enunciated in Gundwana ,
such execution is not a disproportionate means by which to satisfy the judgment debt.
[23] Regarding costs, there is no reason why the general rule should not apply. The
applicant is entitled to the recovery thereof , including the costs reserved on 6 June
15 See how this aspect was addressed in Nedbank Ltd v Malaka 2023 JDR 0650 (GJ), where the
respondent was employed at a mine in the Northern Cape for R 80,000 per month . At paragraph [22].
16 2022 JDR 0995 (ECM).
17 Op ci t, at paragraph [21].
2024 . No basis, however, has been pleaded for an order for payment on an attorney
and client scale. The usual party and party scale applies (scale B).
[24] In the circumstances, the following order is made:
(a) the first respondent’s immovable property , situated at […] C[…] Place,
Blue Bend , East London, more fully described as erf 2 […] Beacon Bay,
Buffalo City Metropolitan Municipality , Eastern Cape Province , in extent
796 square metres, held under deed of transfer number T12911/2018 ,
subject to the conditions therein contained, is hereby declared executable;
(b) a reserve price of R 1,377,610 is hereby set in relation to the sale in
execution of the above immovable property; and
(c) the respondents are ordered to pay the applicant’s party and party costs,
including the costs reserved on 6 June 2024 , on scale B .
_________________________
JGA LAING
JUDGE OF THE HIGH COURT
APPEARANCES
For the applicant: Adv Somandi
Instructed by: Padgens Attorneys
c/o Huxtable Attorneys
26 New Street
MAKHANDA
Email: law3@huxattorneys.co.za
(Ref: Huxtable//Padgens MG/N0569/5775)
For the 1st and 2nd
respondents: Adv Sixabela
Instructed by: Nceba Giwu Inc .
63 Madeia Street
MTHATHA
c/o Yokwana Attorneys
10 New Street
MAKHANDA
Email: lindo@yokwanaattorneys.co.za
Date heard: 28 November 2024.
Date delivered: 18 March 2025.