1 JUDGMENT
IN THE HI GH COURT OF SOUTH AFR ICA
GAUTENG DIVISION. JOHANNESBURG
CASE NO: 092448 /2023
DATE : 26.08.2026
DELETE WHICHEVER IS NOT APPLICABLE
(1) REPORTABLE: NO
(2) OF INTEREST TO OTHER JUDGES: NO
(3) REVISED
In the matter between SIGNATURE DATE 26 August 2026
10 AS HLEY ZWART App li cant
and
INDUSTRIAL DEVELOPMENT CORPORAT ION Respondent
J U D G M E N T EX TEMPORE
WILSON J : The appl icant, Mr Zwart , seeks to rescind an
order granted by my s ister , S iwendu J , on
27 February 2024 , requiring him to pay certain monies to
the respondent , the Industrial Development Corporat ion , in
20 terms of an agreement he s igned, guaranteeing the
repayment of a loan by a company known as Ubergruvi CC ,
which I understand from the papers was run by his brother
in Cape Town unt il h is brother d ied.
After Mr Zwarts' brother died, he took over the
company and found that it was not profitable. As a result of
092448 /2023 _26082026 I jhk
JUDGMENT
092448/2023_ 26082026 / jhk
2
the state of the company, Mr Zwart decided to place it under
voluntary liquidation in 2017. The liquidation of Ubergruvi
was, under the terms of its loan agreement with the
Industrial Development Corporation, an act of default which
entitled the Industrial Development Corporation to cancel
the agreement and sue for the full outstanding balance of
the loan. For whatever reason, the Industrial Development
Corporation did not do that for at least three years.
Some six years later, it sought to enforce the
guarantee against Mr Zwart , and its application to do so
10
gave rise to the default order granted by Siwendu J.
Mr Zwart now asks me to rescind Siwendu J's order. He
relies on the well -known common law requirements for
rescission. In respect of his default, Mr Zwa rt tells me that
he has always resided primarily in KwaZulu -Natal. He has a
company in Pietermaritzburg and lives in Howick. Under
the guarantee he signed, he nominated his domicilium at
Ubergruvi’s address in Cape Town, and that is where the
application to enforce the guarantee was served.
Mr Zwart says that six years after Ubergruvi’s 20
liquidation, he had no reason to suppose that he would be
still pursued on the guarantee, and accordingly no reason to
keep his domicilium updated. He tells me that the first he
knew of Siwendu J's order was when a writ of execution was
served at his business premises in Pietermaritzburg.
JUDGMENT
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3
On t hose facts , which are not seriously disputed by
the Industrial Development Corporation, I can readily
understand Mr Zwart's complaint. I cannot realistically
conclude that he was in wilful default of appearance, given
the lapse of time between the liquidation of Ubergruvi and
the service of the application to enforce the guarantee. Mr
Zwart might reasonably have believed that after all that
time, the enforcement of the guarantee was not a realistic
prospect, and the domicilium he nominated in terms of the
guarantee agreement would not be used for the purposes of
10
service.
Conversely, I think it was unrealistic to the point of
unreasonable for the Industrial Development Corporation to
blithely rely upon a domicilium nominated in an agreement
at least six years old in seeking to enforce the guarantee.
The Industrial Development Corporation might reasonably
have been expected to cons ider whether that domicilium
was still good and to make enquiries as to Mr Zwart's actual
location , to ensure that service was effective. There was, in
my view, no wilful default.
20
The only remaining question is whether Mr Zwart has
a bona fide defence. Here, counsel for Mr Zwart relied
upon terms of the guarantee. I was taken to Clauses 2 and
3 of the guarantee agreement, which, read together with the
definition section of the agreement, defines guaranteed
JUDGMENT
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4
liabilities as all present and future monies an d liabilities
which are now or which may hereafter become, owing by the
borrower, that is, Ubergruvi , to the Industrial Development
Corporation in terms of the finance documents and which
the Industrial Development Corporation is entitled to
recover from the borrower in terms of the finance
documents.
Counsel for Mr Zwart posited that this entails a two -
pronged test. First, the question is whether or not there is
a liability. Second, the question is whether it is a liability
10
that the Industrial Developm ent Corporation is entitled to
recover from Ubergruvi . Mr Zwart argues that because the
Industrial Development Corporation took no action to
recover the debt from Ubergruvi for three years after the
liquidation, the debt owing by Ubergruvi to the Industrial
Development Corporation became prescribed and, as a
result, the Industrial Development Corporation became
disentitled to recover it. For that reason, the guarantee
cannot be enforced.
There were two arguments to the contrary advanced
20
on behalf of the Industrial Development Corporation. The
first was that, because Mr Zwart was a co -principal debtor
under the terms of the guarantee for Ubergruvi’s debts to
the Industrial Development Corporation and that the
guarantee lasted until Mr Zwart was released from it, it did
JUDGMENT
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5
not matter that Ubergruvi’s debts under the loan agreement
had prescribed. Whether or not Mr Zwart can appropriately
be described as a co -principal debtor under the guarantee,
it seems to me that the terms of the guarantee themselves,
part icularly the definition of guaranteed liabilities relied
upon by counsel for Mr Zwart , suggest that it does matter
whether or not , at the time the guarantee is sought to be
activated, the Industrial Development Corporation is entitled
to recover the amounts guaranteed from the borrower,
Ubergruvi . I need not reach a final view on this point, but I
10
need only conclude that on the text of the guarantee, as
constructed on Mr Zwart 's behalf, there is a bona fide
defence that stands some prospects of success.
On the face of things, the defence posited on Mr
Zwart 's behalf is such a defence. It was also suggested
during argument that because the Industrial Development
Corporation is an organ of State , debts to it prescribe after
30 years rather than 3 . T hat point was not pleaded in
opposing the rescission application and may be the subject
of some argument once the application to enforce the
20
guarantee comes to be reargued.
It is not immediately clear to me that a parastatal,
whose sole purpose is to enter into commercial agreements
and make investments on the State's behalf, is to be treated
as an organ of State for the purpose of the Prescription Act.
6 JUDGMENT
It may well be that it is to be so treated , but given the
fa ilure to ra ise the point in the resc ission appl ication , I am
content to leave that argument to the court tha t hears the
ult ima te appl icat ion to enforce the guarantee.
On the papers before me , Mr Zwart has clearly
establ ished the absence of wilful defaul t and a bona fi de
defence that stands some prospects of success. For all
those reasons , I ma ke the following order.
1. The default judgemen t granted by Siwendu J under
10 th is case number on 27 February 2024 is rescinded
and set aside.
2. The costs of this applicat ion w ill be costs in the
cause.
092448 /2023 _26082026 I jhk
WILSON, J
JUDGE OF THE HIGH COURT
26 August 2026