1. INTRODUCTION
1.1. This judgment concerns an application for rescission of a default judgment
granted by the Honourable Wanless J on 3 November 2022. The applicant,
City of Johannesburg Metropolitan Municipality (“the City”), seeks to rescind
the default judgment granted in favour of the respondent, Cabinetile Trading
CC (“Cabinetile Trading”), for the payment of an outstanding invoice amounting
to R1 720 400.00, excluding VAT and payment of interest on the amount of R1
720 440.00 at the prescribed rate of interest per annum a tempore morae from
1 July 2016.
1.2. The applicant seeks to rescind the judgment granted in favour of the
respondent on the grounds that the respondent lacks locus standi; the
respondent has failed to comply with the Institution of Civil Proceedings
Against Certain Organs of State Act; the claim has prescribed; and Particulars
of Claim are flawed.
1.3. The respondent denies the existent of the alleged grounds; further, the
applicant’s application was filed late, without any explanation and furthermore
that the applicant has failed to apply for condonation as envisaged in Rule
31(2) of the Uniform Rules of court and is therefore excipiable.
2. BACKGROUND
2.1. For clarity purposes, the main application, as referred to hereafter, refers to the
default judgement application. The plaintiff, in the main application, as referred
to hereafter, refers to Cabinetile Trading, and the defendant , in the main
application, as referred to hereafter, refers to the City.
2.2. On or about 9 March 2016, employees of Pikitup (a state -owned entity which
renders waste management services to the defendant), namely members of
the South African Municipal Workers Union, embarked on an unprotected
strike action pertaining to salary increments. As a result, during the course of
March 2016, the then City Manager of the defendant, established a Joint
Operations Task Team comprising various departments under the defendant,
the objective of which was to perform emergency waste management services.
2.3. At the time of the strike the plaintiff was a waste management service provider
for the City, and the defendant orally, with an undertaking to enter into a formal
service level agreement at a later stage , appointed the plaintiff to render
emergency services to the City.
2.4. The plaintiff, as a matter of urgency, repaired plumbing utilities which had
resulted in water wastage in Soweto's informal settlements; removed waste
which had accumulated since the commencement of the strike in Soweto's
informal settlements and cleaned up waste created in illegal dumping sites and
garden sites.
2.5. All services were rendered satisfactory by the plaintiff. The plaintiff used its
own resources, inter alia, twenty tipper trucks and 4 TLBs, at its own expense
to render the services , albeit with a legitimate expectation to be reimbursed
fully by the defendant.
2.6. On or about 1 August 2016, the defendant, expressed its satisfaction with the
emergency services rendered by the plaintiff, when it, duly represented by its
then, City Manager, and the Executive Mayor at the time, presented to the
plaintiff a certificate of appreciation, extending its appreciation to the plaintiff
for being part of its integrated solution into cleaning up the municipality during
a strike at the time.
2.7. The defendant agreed that it would effect payment to the respondent within 30
(thirty) days of its receipt of an invoice for services rendered.
2.8. The plaintiff rendered said invoice and struggled for years to be reimbursed
even though the defendant provided the plaintiff with a ratification report in
2019, and a purchase order in 2020 , as acknowledgment for the services
rendered by the plaintiff, the debt owed to the plaintiff and the authorization for
payment of same.
2.9. Ultimately, the ratification report recommended that the defendant, through the
City Manager, must approve the payment of the plaintiff for the services
provided between April, May, and June 2016 and that the plaintiff is paid the
amount R1 636 453.60, which amount comprised the amounts of R 1 496
000.00 and R142 453.60 (exclusive of value added tax).
2.10. The ratification report was followed by a purchase order, issued from the
defendant to the plaintiff, in February 2020. The purchase order was for the
immediate payment of the debt, for services as described in the purchase
order.
2.11. Despite the abovementioned ratification report, purchase orders and
various letters of demand , the defendant failed, neglected, and/or refused to
effect payment. As a result, on 6 October 2021, the plaintiff instituted legal
proceedings for breach of contract, and in the alternative, unjustified
enrichment.
2.12. The defendant was duly served with combined summons on 11 October
2021 and was afforded until 9 November 2021 to enter a Notice of Intention to
Defend, which it has to date not entered. Consequently, the plaintiff applied for
judgment in default as envisaged in Rule 31 (2)(a) of the Uniform Rules of
Court.
2.13. Rule 31 (2)(a) provides: “When ever in an action the claim or, if there is
more than one claim, any of the claims is not for a debt or liquidated demand
and a defendant is in default of delivery of notice of intention to defend or of a
plea, the plaintiff may set the action down as provided in subrule (4) for default
judgment and the court may, after hearing evidence, grant judgment against
the defendant or make such order as it deems fit."
2.14. As mentioned above, at the time when combined summons was served
on the defendant, the defendant did not enter a Notice of Intention to defend,
which subsequently resulted in the granting of the default judgment in favour
of the plaintiff on 3 November 2022.
2.15. The defendant (now the applicant) instituted an application for a
rescission or setting aside of the default judgment granted by this Court on 3
November 2022.
2.16. The applicant seeks to rescind the judgment granted in favour of the
respondent on the grounds that the respondent , inter alia, lacks locus standi;
the respondent has failed to comply with the Institution of Civil Proceedings
Against Certain Organs of State Act; the claim has prescribed; and procedural
irregularities.
2.17. The respondent denies the existent of the alleged grounds for recission;
contents that the applicant’s recission application was filed late without any
justifiable explanation to support the late filing and furthermore that the
applicant has failed to apply for condonation for the late filing of the recission
application.
2.18. The applicant asserts that it did not rely on the requirements of Rule
31(2) of the Uniform Rules of Court, since “ it [the recission application] does
not rely on any error in the proceedings and therefor, the recission application
was brought in terms of Rule 31(2)(b) of the Uniform Rules of Court.
3. THE RELEVANT CONTEXT
3.1. The respondent, Cabinetile Trading, was engaged by the City of Johannesburg
to perform emergency services during a municipal workers' strike in 2016. An
invoice for the services rendered was submitted on 1 June 2016. The
respondent alleges that the City fa iled to make timeous payment of the debt
owed, and this omission resulted in breaching the agreement., which in turn
lead to the issuance of summons on 11 October 2021, and subsequently
obtaining a default judgment on 3 November 2022.
3.2. The applicant argues that the claim had prescribed by 31 May 2019, and no
valid Section 3 notice was served as required under the Institution of Legal
Proceedings Against Certain Organs of State Act.
4. THE LEGAL PRINCIPLES APPLICABLE ARGUED
4.1. The legal principles applicable to this case include the Uniform Rules of Court,
particularly Rule 31(2), governing the rescission of judgments.
4.2. The Prescription Act 68 of 1969, which stipulates that a debt prescribes after
three years unless interrupted.
4.3. The Institution of Legal Proceedings Against Certain Organs of State Act 40 of
2002, which requires a Section 3 notice to be served within six months before
instituting legal proceedings against an organ of state.
4.4. In addition, at the time of initiating proceedings, Cabinetile Trading's
registration status was in question, although it was later reinstated on 2
February 2023. These facts provide the backdrop for the legal proceedings
and the issues being addressed in the case.
4.5. The crux of the applicant's argument is that the respondent’s claim was
prescribed by 31 May 2019, as the summons was only served in October 2021,
well beyond the three-year prescription period. The applicant also argues that
the Section 3 notice was not served within the prescribed six-month period and
was addressed to the wrong person, thus invalidating the proceedings.
4.6. The respondent counters that the City acknowledged the debt through partial
payment and issuance of a purchase order in 2020, which interrupted the
prescription. Furthermore, the respondent argues that the absence of a
Section 3 notice can be rectified by seeking condonation and that the
alternative claim for unjust enrichment does not constitute a debt under the
Institution Act, thus not requiring a Section 3 notice.
5. ANALYSIS
5.1. After consideration of the pleadings and hearing oral argument for both parties,
the court must first and foremost determine whether the applicant has
demonstrated a reasonable and acceptable explanation for a defence to the
claim that it did not wilfully act in default, and if granted the opportunity to state
its case, it will have a prima facie prospects of success.
5.2. In its determination, it is trite that the court must not only consider whether
there are bona fide reasons for default, but also w hether there is potential
prejudice to the respondent and whether the rescission is pursued in good
faith.
5.3. To this effect, the applicant’s counsel is required to be fully informed about the
legal process and associated timelines required under Rule 31(2) of the
Uniform Rules of Court and clearly demonstrate compliance to the court.
5.4. Rule 31(2) provides that:
5.4.1. Whenever in an action the claim or, if there is more than one claim, any
of the claims is not for a debt or liquidated demand and a defendant is in
default of delivery of notice of intention to defend or of a plea, the plaintiff
may set the action down as provided in subrule (4) for default judgment
and the court may, after hearing evidence, grant judgment against the
defendant or make such order as it deems fit; and
5.4.2. A defendant may, within 20 days after acquiring knowledge of such
judgment, apply to court upon notice to the plaintiff to set aside such
judgment, and the court may, upon good cause shown, set aside the
default judgment on such terms as it deems fit.
5.5. The applicant seeks rescission under Rule 31(2)(b) of the Uniform Rules of
Court, which allows for rescission of a default judgment if the applicant can
show "good cause." This typically requires demonstrating a reasonable
explanation for the default, and that there is a bona fide defence to the claim.
5.6. It is trite that the common law also requires compelling cause to be shown for
setting aside a default judgment. The principles of good cause are well
established: An applicant is expected to give a reasonable explanation of its
default and show that its application is made bona fide and show that it has a
bona fide defence to the Plaintiff's case, which prima facie has some prospect
of success, if advanced to trial.
5.7. In this instance, it seems if though the applicant and its counsel, elected to
ignore the court rules, by simply omitting to apply for condonation for the late
filing of the recission application.
5.8. In Kataka v Standard Bank (060093/23) [2025] ZAGPPHC 512, Moila AJ, ruled
that: “The judicial facts required for an application under uniform Rule 31(2)(b)
are the following: default judgment has been given in an action, within 20 days
after obtaining knowledge of the judgment, deliver a notice, upon good cause
shown. The requirement for good cause shown is no different in the context of
common law than in the context of Uniform Rule 31(2)(b). That being said, if
one of the jurisdictional facts does not exist , the court has no jurisdiction to
rescind in terms of the Uniform rule 31(2)(b) or the common law.”.
5.9. Whereas the court order was served on the applicant on 8 November 2022,
the applicant instituted its application for rescission on 8 December 2022. The
period in which the application should have been instituted expired on 6
December 2022. Accordingly, the application was instituted 22 (twenty -two)
days consequent to the service of the court order.
5.10. Given that Rule 31(2) patently requires of an applicant to bring such an
application within 20 days of its knowledge of the Order in the main application,
failing which a condonation application must accompany the application, the
applicant has not only failed to launch its rescission application within 20 days
of its receipt of the Order, but has also failed to apply for condonation for the
late institution of its application for rescission.
5.11. The Applicant’s reasoning for the omission to apply for condonation due
to its assertion that "it does not rely on any error in the proceedings and
therefor, the recission application was brought in terms of Rule 31(2)(b) of the
Uniform Rules of Court and the common law”, is a failed attempt to provide a
reasonable explanation for its default.
5.12. Considering the facts in this recission application, in a fair, reasonable,
rational and justifiable manner, I am therefore inclined to agree with the
proposition by the respondent that the applicant's failure to apply for
condonation for the late filing of the recission application should be dismissed,
solely due to its lateness, however, and more so, since the applicant filed its
recission application without any application for condonation.
5.13. Notwithstanding the applicant’s failure to comply with the court rules and
to apply for condonation, the court is of the view that even in the instance that
the applicant did apply for condonation for the late filing of the recission
application, it did not convince the court that it had a bona fide defence against
the default judgment and more importantly that it did not act in a non -wilful
manner.
5.14. In consideration of the applicant’s defence against default judgment, it is
important to consider the exact facts that let to the default.
5.15. The applicant (at the time the defendant) was duly served with combined
summons on 11 October 2021 and was afforded until 9 November 2021 to
enter a Notice of Intention to Defend, which it has to date , not entered.
Consequently, the respondent (at the time the plaintiff) applied for judgment in
default as envisaged in Rule 31 (2)(a) of the Uniform Rules of Court.
5.16. Rule 31 (2)(a) states “When ever in an action the claim or, if there is
more than one claim, any of the claims is not for a debt or liquidated demand
and a defendant is in default of delivery of notice of intention to defend or of a
plea, the plaintiff may set the action down as provided in subrule (4) for default
judgment and the court may, after hearing evidence, grant judgment against
the defendant or make such order as it deems fit."
5.17. As mentioned above, at the time when combined summons was served
on the applicant in the default judgement proceedings, the applicant did not
enter a Notice of Intention to defend, which subsequently resulted in the
granting of the default judgment against the applicant.
5.18. The responded convinced this court that proper service of the combined
summons and particulars of claim with annexures & notice, was served on a
para-legal/intern employee, a certain Ms Moleke, at the applicant’s registered
address.
5.19. In paragraph 9 of the applicant’s replying affidavit in response to ad
paragraph 15 of the respondent’s responding statement, the applicant
acknowledged that “there was a clear and outlined process for registering and
receiving legal documents and there wa s clear supervisor of the interns who
were responsible for receiving” and that “In this present case it is accepted that
there may have been an air of negligence by a former employee/intern Ms
Moleke when handling the particulars of claim as same never reached the legal
advisor.
5.20. The recipient of the duly served combined summons was not an ordinary
employee of the applicant. It is important to note that at the time, when service
of the combined summons was effected on the applicant on the 11th of October
2021, the recipient of the combined summons, Ms Moleke, was already
employed from the 1 st of April 2021 - seven months, by the applicant as an
“intern in the Group Legal and Contracts department of the City of
Johannesburg…Litigation unit”.
5.21. On its own version, the applicant explained at length the process and
procedures of training legal interns: “It is perhaps instructive at this juncture, to
set out the process of acceptance of service by the Applicant. The Applicant
employs legal advisors and legal interns/paralegals. Part of the responsibilities
of the interns is to receive summons and any other legal processes which are
regularly served on the Applicant. Once a summons has been served on the
legal interns, they have to give that summons to the legal advisers for further
handling. When receiving service, the legal interns would ordinarily affix the
Applicant's stamp confirming that service was effected.… The legal adviser
who would have received that summons would then seek the necessary
permissions to appoint a firm of attorneys for the purposes of defending or
opposing the matter. That, in a nu tshell is a process of handling summonses
after service on the Applicant.”.
5.22. The applicant failed to introduce any confirmatory evidence, in the form
of a sworn statement or confirmatory affidavit, deposed by Ms Moleka, to affirm
that Ms Moleka ha d read the main affidavit , in order to affirm that the facts
contained within it, especially the submissions relating to her purported
negligence, are indeed factually correct.
5.23. Neither did the applicant present any evidence that Ms Moleka did not
receive the combined summons on the 11th of October 2021, in a procedurally
incorrect manner.
5.24. Furthermore, the applicant did not present any legal argument during the
trial that could convince this court that there was any reasonable attempt to
obtain a confirmatory affidavit from Ms Moleka. Consequentially, the court does
not accept the hearsay evidence advanced by the applicant.
5.25. A primary consideration which cuts through the entire pleaded case for
recission, is that the applicant, who on its own admission, argued that the city
regularly receives and register legal documents, and in this specific instance,
admits that “there was clear supervisor of the interns who were responsible for
receiving”, is in stark contradiction, also arguing that Ms Moleka , negligently,
acted in isolation.
5.26. This is a clear contradiction. The reasonable and rational deduction must
be that the applicant, and not an individual intern, bears ultimate responsibility
for the service and registration of important legal documents.
5.27. The respondent should never be subject ed to any form of prejudice in
the instance that the applicant does not have the necessary and or
precautionary procedures in place to manage the proper receipt of legal
documents, even in the instance where it is argued that the sole reason for the
default, is because an intern acted in a negligent manner. The applicant bears
ultimate responsibility for its interns, and thus its failure to exercise said
responsibility is wholly unsatisfactory.
5.28. The court agrees with the respondent that the applicant's explanation of
its default is wholly unsatisfactory. In my view, a party who deliberately or
negligently chooses not to oppose a summons, should not complain against a
judgment that was ostensibly granted erroneously in their absence.
5.29. In considering the merits of the applicant’s argument in respect of non-
willful default, the Constitutional Court held in Zuma v Secretary of the Judicial
Service Commission of Inquiry into Allegations of State Capture , 2021 (11)
BCLR 1263 (CC), that a litigant who ignored court processes cannot later seek
to rescind, whereas he knew the consequences of the order sought against
him. The court emphasized that in the absence of a reasonable explanation for
the default, the court is not obligated ever to assess the prospects of success.
5.30. The following proposition was put forward in Government of the Republic
of Zimbabwe v Fick and Others [2013] ZACC 22, where the court held that: "At
common law the requirements for rescission of a default judgment are twofold.
First, the applicant must furnish a reasonable and satisfactory explanation for
its default. Second, it must show that on the merits, it has a bona fide defence,
which prima facie carries some prospects of success..”
5.31. It follows, that proof of this requirement is taken as showing that there
must be sufficient cause for an order to be rescinded. A failure to meet one of
them may result in refusal of the request to rescind.
5.32. In Chetty v Law Society, Transvaal [1985] (2) SA 756 (A) , Miller JA
formulated the test in these terms: "It is not sufficient if only one of these two
requirements is met. For obvious reasons, a party showing no prospect of
success on the merits will fail in an application for rescission of a default
judgment against him, no matter how reasonable and convinc ing the
explanation of his default… and ordered judicial process would be negated if,
on the other hand, a party who could offer no explanation of his de fault other
than his disdain of the rules was nevertheless permitted to have a judgment
against him rescinded on the ground that reasonable prospects of success on
the merits. The reason for my saying that the appellant's application for
rescission fails on its own demerits is that I am unable to find in his lengthy
founding affidavit or elsewhere in the papers any reasonable or satisfactory
explanation of his default and the total failure to offer any opposition whatever
to the confirmation on 16 September 1980 of the rule nisi issued. on 22 April
1980."
5.33. It is common cause that t he applicant never disputed that there was an
agreement with the respondent to deliver emergency services to the applicant
for a certain monetary value and , furthermore, that the respondent had fully
dispensed with its obligation under the agreement with the applicant , by
delivering such emergency services to the satisfaction of the applicant. The
applicant knew for a very long time that it had to pay and simply ignored this
obligation through extensive frustration and evasive actions, causing the
respondent much difficulty, however, it seems that negligence, resulted in one
evasive action to many.
5.34. I concur with Honourable Wanless J’s default judgement, on the premiss
that the applicant failed to demonstrate a reasonable explanation for the
default and that its defense, which is based on a misconstrued prescription and
procedural non-compliance interpretation, did not convince the court that the
defence is a bona fide, substantiated defense, and consequentially, is rejected,
more so, in light of its own failures of procedural non-compliance.
5.35. The court's primary goal in the application for rescission of judgment is
to ensure fairness and justice between the parties. It would simply not be fair,
rational and justifiable to condone the blatant non-compliance of court rules,
whilst the very remedy relied on by the applicant pertains to an argument for
prescription. It is this court’s view that the applicant , in any event , did not
convince the court that it did not willfully default and that it had a bona fide
argument for such default , with prima facie prospects of success , if the order
was to be rescinded and the applicant was awarded another opportunity.
5.36. The general rule is that costs follow the result. I have no reason to
depart therefrom. Accordingly, the following order is granted:
6. ORDER
6.1. The application is dismissed with costs.