IN THE HIGH COURT OF SOUTH AFRICA
(WESTERN CAPE DIVISION, CAPE TOWN)
Case no: 7287 /2024
In the matter between:
CONSTANTINE GODFREY VARLEY First Applicant
BASIC BLUE TRADING Second Applicant
And
ARTHUR FREDERICK MERKEL Respondent
ORDER
The application for leave to appeal is dismissed.
JUDGMENT: APPLICATION FOR LEAVE TO APPEAL
Nziweni, J
Introduction
[ 1] This is an application for leave to appeal the whole judgment and order of this
Court. The Applicants are raising 6 grounds on which they allege that this Court erred.
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[2] I believe it is convenient to outline the grounds for this application while
simultaneously addressing the specific merits. The grounds are as follows:
Ground 1:
This court erred in finding that, notwithstanding the authorities being divided on the
issue, Plaintiff was not prohibited from proceeding with a summary judgment
application, when already having taken a further procedural step by filing a replication
to Defendants plea.
[3] The Applicants' argument is based on the premise that conflicting decisions
exist within this Division. The Applicants remain steadfast that there are conflicting
decisions in this Division concerning whether a summary judgment application is still
competent after a Plaintiff has filed a replication.
(4) I addressed this point extensively in the main judgment. There are several
problems with the Applicants' submissions. The Applicants' claim regarding public
interest and legal certainty fails to acknowledge that there is no conflict of authority in
this Division. The main difficulty with the Applicant's contention springs from the fact
that the case upon which this argument is predicated upon, does not actually say so.
[5] The Applicants' submissions regarding public interest and legal certainty fail to
acknowledge that no conflict of authority exists in this Division. The case cited by Mr
Benade is irrelevant to this assertion; the primary difficulty is that the very authority
upon which the argument is predicated does not support it.
(6) The Applicants are of the view that Ingenuity Property Investments (Ply) Ltd v
Ignite Fitness (Pty} Ltd (9845/2022) [2023] ZAWCHC 129; [2023] 3 All SA458 (WCC);
2023 (5) SA 439 (WCC) (29 May 2023}, is in conflict with the case of Brittex Real
Estate Corporation v CPH Developments (Ply) Ltd (unreported case number
8167/2022 WCC} dated 03 November 2023.
[7] In Brittex at paragraph 30, the court said something quite interesting on the
divided authorities Brittex sought to rely on. The court stated the following:
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" . . . Brittex sought to rely on the (divided) authorities regarding the question of whether a Plaintiff
forfeits the right to apply for summary judgment by filing a replication. These cases are of no
assistance in casu. Firstly, because the cases themselves are divided on the issue. Secondly,
this case is Plainly disUnquishable because Brittex did not file a replication: it took active
procedural steps to advance the matter to trial (amended its own pleading) and also filed a
Rule 23 Notice in respect of the amended plea ." Emphasis added.
[8] In that light, I fail to discern any ground that supports the Applicants' assertion
in Brittex. In the Brittex case, the court found that Brittex's action [to amend and filing
of Rule 23 Notice] was plainly djstjngujshable from the replication debate.because
Brittex had gone further, by amending its own pleadings and filed a Rule 23 Notice. In
the Brittex matter, the court did not regard replication as an active step that makes
summary judgment incompetent. In the Brittex case the court made a sharp distinction
between the act of filing a replication and taking other active procedural steps to
advance a matter to trial.
[9] Thus, I find the Brittex matter readily distinguishable from the Ignite Fitness
matter on both their facts and their core legal outcomes. As such, as previously
mentioned, the case cited by Mr Benade in his opinion to support the assertion of
conflicting decisions, is in fact not on point.
[1 O] Thus, Applicants' reliance on Brittex is not well-grounded. Moreover, the
existence of divergent precedents between various divisions is a routine feature of our
legal system; this Court is not bound by the decisions of different jurisdiction.
Consequently, such a divergence does not constitute a compelling ground for granting
leave to appeal.
Ground 2:
This Court erred in her finding not to accept the Applicants' version that:
1. Annexure "POC2" constitutes a non-binding negotiations aimed at exploring
1. Annexure "POC2" constitutes a non-binding negotiations aimed at exploring
potential methods of reimbursing Plaintiff's venture capital;
2. Which does not establish any legal obligation or admission of liability; and
3. Which was anything more than friendly gestures aimed at repairing their
relationship.
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[11] I addressed this point extensively in the main application.
[12] Even assuming this to be the case, subjective characterisation cannot trump
objective evidence. A label or personal interpretation is secondary to the facts and
context from which a reliable conclusion is drawn. The Applicants' ground relies on
subjective framing that is simply not borne out by the record.
[13) A party can characterise a transaction as a "friendly gesture" but if the
circumstances show something else, the characterisation fails.
Ground 3:
The court erred in not accepting Defendants' explanation as to why 50 % membership
interest in second Defendant was not transferred to Plaintiff, i.e. that Plaintiff had in no
uncertain terms made it known to Defendants that such transfer would complicate his
tax matters in Switzerland ...
[14] The answer to this ground lies in POC1. The main judgment also illustrates this.
In this ground the Applicants are challenging this Court's evaluation of evidence. It is
now settled that for an Applicant to be granted leave to appeal, an Applicant must
demonstrate reasonable prospects of success-specifically, that another court would
(not just might) reach a different conclusion based on a "sound, rational basis.
Disagreement is not a misdirection" or error of law.
Ground 4:
The Court erred in interpreting of the Defendants' defence with regard to annexure
"POC1"
[15] Paragraph 48 of the main judgment reads as follows:
"[48] The Defendants' version does not cater for the existence of POC1. Likewise, the assertion
by the Defendants merely suggests that they do not bear knowledge of the character or
essential terms of POC1 ."
[15] The Defendants' own plea substantiates this finding. See paragraph 5 of the
plea.
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Ground 5:
This Court erred in accepting that the Plaintiff has presented sufficient documentary
evidence as proof of his version of the agreement. Support for the Defendants' version
of the agreement is found in the conclusion in paragraph 60 of the judgment.
[16] Simply disagreeing with how the Court's weighing of evidence was conducted,
is not a valid ground for appeal. The Applicant must show a sound, rational basis for
why another court would reach a different conclusion. First and foremost, paragraph
60 of the main judgment does not support the Defendant's version. As such, the
Defendants' reliance on paragraph 60 is misplaced as it does not support their case.
Once again, the Defendants are challenging this court's finding after evaluation of
evidence. This cannot be the ground of appeal. Furthermore, challenging the court's
evidentiary findings constitutes a mere disagreement rather than a legitimate ground
for appeal.
Ground 6:
The court erred in finding that no real genuine dispute of fact exists in the matter.
[17] The mere presence of a factual dispute is not an automatic bar to summary
judgment. For a dispute of fact to successfully defeat a summary judgment application,
it must meet a criterion. Insofar as is relevant to the present discussion, this ground
can only be a successful ground for appeal if the Applicants can demonstrate that a
material and bona fide dispute of fact existed which made it impossible for the court to
decide the matter on the affidavits alone. And that there is a triable issue to any
material fact.
[18] Under these circumstances, I found in the main judgment that there is no merit
to the Applicants' defence to the Plaintiff's cause of action.
[19] In addition, beyond a mere characterisation of the facts as 'disputed,' the
Applicant's papers offer no objective circumstances to justify such a finding.
Accordingly, the Applicants do not identify the specific, irreconcilable facts that would
Accordingly, the Applicants do not identify the specific, irreconcilable facts that would
constitute a genuine dispute; As such le~ving the claim unsupported by the record.
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[20) The Respondent correctly contends that the Applicants are attempting to re
litigate the matter. This application is entirely devoid of merit and fails to meet the
statutory threshold required for the relief sought, as stipulated in section 17( 1) of the
Superior Courts Act, Act 10 of 2013.
[21) In the result, I make the following order:
Order
21 .1 The application is dismissed with costs on scale B.
NZIWENI, J
JUDGE OF THE HIGH COURT
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Appearances:
Counsel for the Applicants Advocate T Benade
counsel for the Respondent Advocate R Steyn