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[2015] ZAWCHC 94
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Lewis v Department of Environmental Affairs And Development Planning (5656/2013) [2015] ZAWCHC 94 (28 May 2015)
IN THE HIGH COURT OF SOUTH AFRICA
(WESTERN CAPE DIVISION, CAPE TOWN)
CASE NO: 5656/2013
DATE: 28 MAY 2015
In the matter between:
DR SAMUEL ELLIS
LEWIS
..................................................................................................
Applicant
And
THE DEPARTMENT OF ENVIRONMENTAL AFFAIRS
AND DEVELOPMENT
PLANNING
..................................................................................
Respondent
JUDGMENT
: DELIVERED ON 28 MAY 2015
MANCA AJ:
1.
The
applicant commenced action proceedings, as plaintiff, against the
respondent, as defendant, in April 2013. As much of
this
judgment will refer to allegations contained in the pleadings in the
action, I will refer to the parties as the plaintiff
and the
defendant.
2.
In
his original particulars of claim, the plaintiff alleged that at all
material times he was the owner of the property known as
Portion 2 of
Erf 182/4 Hoogekraal, District George ("the property") and
that he had concluded an oral agreement of lease
with KG Timbers CC
("KG Timbers"), in terms whereof he let the property to KG
Timbers for the purpose of sawdust milling
at a monthly rental of
R35 000 per month.
3.
He
alleged that on 15 October 2009 the defendant had served him
with an unlawful notice in terms of s 31(1) of the National
Environmental Management Act 107 of 1988, in terms whereof he was
ordered to,
inter alia
,
cease all decommissioning of timbers on the property; appoint
an environmental assessment practitioner to compile a report
and to
submit a report and rehabilitation plan for approval by the
defendant.
4.
The
plaintiff alleged that, consequent upon service of the notice, KG
Timbers vacated the property and no longer paid him rental.
He
sought to hold the defendant liable for the loss of that rental.
The plaintiff also alleged that, as a consequence of
KG Timbers
vacating the property, he was unable to sell 33 000 metric tons
of compost at a profit of 50 cents a kilogram,
and as a result he
incurred a further loss in the amount of R15 million.
5.
On
27 May 2013 the defendant entered an appearance to defend.
The plaintiff thereafter delivered various notices of his
intention
to amend his particulars of claim. In August 2013 he delivered
a set of amended particulars.
6.
In
the amended particulars the plaintiff made specific reference to a
meeting which took place on 19 August 2010, at which
meeting, so
it was alleged by the plaintiff, he was told by representatives of
the defendant what action was required of him to
remedy the
environmental issue that had arisen at the property. He alleged
that he furnished his rehabilitation plan in accordance
with the
defendant's advices by 7 September 2010, but that on or about
8 February 2011 the defendant rejected his rehabilitation
proposal and kept in force the compliance notice. He did not
allege that any agreement was concluded at this meeting.
7.
He
also alleged that when the compliance notice was served the defendant
was aware that the property was bonded and that he derived
an income
therefrom from KG Timbers, which income was used to make the bond
repayments.
8.
He
went on to allege that, as a result of the defendant's conduct, he
received no further rental income, was unable to pay the bond
instalments, fell into arrears with his payments and, as a
consequence, the property was sold in execution by the bondholder for
R151 000. According to him, this was way below the market
value of the property and he claimed damages in the sum of
just over
R4 million, being the difference between the market value of the
property and that for which it was sold in execution.
He
continued to claim loss of rental for 32 months, from June 2010 to
January 2013, and his loss of profit in respect of the compost
in the
sum of R15 million. For the sake of completeness I should
add that the unlawful act upon which he relied as the
cause of his
woes, remained the unlawful notice which had been served on him.
9.
On
6 September 2013 the defendant delivered a notice in terms of
Rule 23(1) of the High Court Rules, in which notice the defendant
alleged that the amended particulars of claim failed to disclose a
cause of action, alternatively were vague and embarrassing.
In
so far as the defendant alleged that the particulars were vague and
embarrassing, the plaintiff was afforded an opportunity
of removing
the causes of complaint.
10.
In
the Rule 23(1) notice the defendant alleged,
inter
alia
, that before the plaintiff could
institute legal proceedings against the defendant, it was obliged to
give the defendant notice
of the intended action, pursuant to the
provisions of the Institution of Legal Proceedings against Certain
Organs of State Act,
No. 40 of 2002 ("the ILP Act").
11.
The
defendant alleged that no allegations of fact were made in the
particulars of claim to the effect that the plaintiff had complied
with the provisions of s 3 of the ILP Act, which required that
no legal proceedings for the recovery of a debt may be instituted
against an organ of state unless the organ of state was given the
requisite notice.
12.
The
defendant also alleged in the Rule 23(1) notice that no cause of
action had been made in delict; that no allegations of
fact
were made to sustain the conclusion that the defendant was liable to
the plaintiff in respect of his alleged economic loss
and that the
defendant's conduct was not actionable.
13.
The
plaintiff did not respond to the Rule 23(1) notice and on 8 October
2013 the defendant delivered an exception to the plaintiff's
particulars of claim, which exception mirrored the grounds set out in
the Rule 23(1) notice.
14.
This
application was launched on 18 December 2013.
15.
In
this application the plaintiff seeks an order "
condoning
the late filing of the applicant's notice in terms of the provisions
of the Institution of Legal Proceedings against Certain
Organs of
State Act 40 of 2002
".
16.
In
the founding affirmation deposed to by the plaintiff, he referred to
the exception which had been taken to the particulars of
claim and
stated that when the particulars of claim were drafted, his legal
representatives omitted to send a notice as contemplated
by s 3
as read with s 4 of the ILP Act.
17.
He
alleged that "
this was purely an
oversight and was occasioned as a result of the focus being on a
perusal of the documentation relevant to the
matter. Trying to
understand it and considering that the Department of Environmental
Affairs and Development Planning is
an organ of state and accordingly
it was necessary to give the requisite six months' notice. In
the rush to settle the particulars
of claim, this aspect was
overlooked
". Just what the
rush was to settle the particulars of claim was not explained,
although it may have been that prescription
of the plaintiff's claim
was looming large.
18.
The
plaintiff also alleged that on 24 October 2013 his attorney
addressed a letter in terms of the ILP Act to the defendant.
He
annexed a copy of that letter to his affirmation.
19.
In
that letter his attorney made specific reference to the unlawful
notice as the basis for the plaintiff's claim against the defendant
and, in his founding affirmation, the plaintiff expressly stated that
his cause of action was set out in that letter.
20.
I
should add that, in the founding affirmation, the plaintiff made no
allegation that he enjoyed prospects of success in the action.
He did aver that should the Court which was to hear the exception
find that the exception was bad and that he had a good cause
of
action, this was a factor which would weigh heavily in favour of
condonation being granted. By implication, he appeared to accept
that
if the exception was good, this would be a factor which would weigh
heavily against condonation being granted.
21.
No
confirmatory affidavit was deposed to by his attorney.
22.
The
defendant's answering affidavit was delivered on 15 April 2014.
The application was opposed and the defendant took
issue with the
plaintiff on all material issues, including but not limited to
whether the plaintiff had adequately explained his
default and
whether he enjoyed any prospects of success in the action. The
answering affidavit could have left the plaintiff
with no doubt that
the defendant denied that the plaintiff had good cause for his
failure to comply with the ILP Act.
23.
After
the answering affidavit was delivered, and in August 2014, the
plaintiff again sought to amend his particulars of claim.
In
that amendment, which was opposed, but in respect of which leave to
amend was granted on 20 February 2015, the plaintiff
no longer
alleged that the notice was unlawful but alleged that the notice
effectively precluded him from generating any income
from the
property. In other words, he no longer relied on the unlawful
notice as the basis for his cause of action.
24.
He now alleged that in August 2010 and at
the meeting held with representatives of the defendant (and to which
he had referred in
a previous iteration of his claim),
[1]
a procedure was agreed to in terms of which he would prepare a
rehabilitation plan for consideration by the defendant. He
alleged that, as a consequence of that agreement, and the
Constitution of the Republic, the defendant owed him a duty of care
to consider his plan timeously; to follow a fair procedure when
considering that plan; to act without negligence;
to
schedule meetings and to expedite the finalisation of the matter.
25.
The
plaintiff went on to allege that, in breach of that duty, the
defendant failed to consider, review and adopt the plan before
September 2010. I pause to mention that the plaintiff did not
allege that the defendant was under a duty to adopt the plan
at all,
let alone before September 2010. He also alleged that meetings
were not scheduled, that the defendant took no steps
to consider the
plan, and that the defendant only considered and reviewed the plan in
February 2011 when the defendant rejected
the plan.
26.
As
a result of that conduct, the plaintiff alleged that KG Timbers
vacated the property in June 2010 and paid him no further rental,
he
was unable to generate income, he could not make bond payments and
the property was sold in execution. He accordingly
claimed
damages of loss of rental from September 2010, loss of profit from
his inability to sell compost and the difference in
the market value
of the property and what it realised in a sale in execution.
27.
The
plaintiff did not deliver a replying affirmation to the defendant's
answering affidavit.
28.
On
8 May 2015, however, the plaintiff delivered a supplementary
founding affirmation. In that affirmation he stated that
he had
been advised by counsel that his original application for condonation
was lacking in detail and did not address all the
relevant issues.
Counsel also apparently advised him that the most relevant document
was a letter which had been addressed
by his attorneys to the
defendant on 16 August 2012 and which had not been included in
his founding affirmation. This
letter was annexed to his
supplementary founding affirmation.
29.
It
was and is a letter which was written by his attorney to the
defendant on 16 August 2012, in which letter his attorney
complained that the defendant's ongoing conduct in the matter, which
he characterised as obstructive, "
is
responsible and grossly negligent
"
and alleged that, as a consequence, the plaintiff had suffered
damages in the amount of R14.7 million made up by,
inter
alia
, a loss of rental and other issues
which were set out in a schedule with which the Court has not been
favoured. The plaintiff
demanded payment of the R14.7 million
in the letter.
30.
Specific
reference was made in the letter to the plaintiff's bondholder being
in the process of selling the property in execution
and that it was
inevitable that the property would be sold at a fraction of its
value. The letter advised the defendant that
the plaintiff
would hold the defendant liable for such loss once those damages had
been quantified.
31.
Although
counsel is said to have advised the plaintiff that his original
application for condonation was lacking in detail, counsel
apparently
failed to advise the plaintiff that one of the aspects in which his
application lacked detail was the failure to allege
that he enjoyed
some prospects of success in the action. No allegations are
made in this regard in the supplementary affirmation.
32.
What
one does find in the supplementary affirmation is an allegation that
the plaintiff has suffered damages as a result of the
respondent's
conduct, as set out in the amended particulars of claim.
33.
No
attempt was made to explain why he now accepted that the notice was
lawful and that he now based his cause of action on the breach
of a
procedural agreement he had reached with the defendant in September
2013. What he did allege, in this affirmation, was
that his
damages only manifested themselves during February 2012 when the sale
in execution took place. (It turns out that
this date was
incorrect and that the sale in execution only took place on
31 October 2012. This was corrected by way
of a further
supplementary founding affirmation handed up at the commencement of
the hearing.) This allegation was made in
order for him to
allege, as he did, that the debt owed by the defendant to him only
became due during February 2012.
34.
There
can be no doubt that this allegation was made by the plaintiff in
order to allege, as he did, that the August letter constituted
compliance with the ILP Act.
35.
In
summary, the main purpose of the supplementary founding affirmation
was for the plaintiff to allege that his claim against the
defendant
only became due in February 2012 and that this attorneys gave the
defendant notice of his claim in August 2012.
The consequence
thereof, so he submitted in his supplementary affirmation, was that
there had been compliance with the ILP Act.
36.
Once
again, there was no confirmatory affidavit from his attorney.
37.
A
supplementary answering affidavit to the supplementary founding
affirmation was deposed to by the defendant. The gist of
that
affidavit remained that the plaintiff had not made out a case for
condonation.
38.
On
12 May 2015 the defendant again delivered a notice in terms of
Rule 23(1) in which it alleged that the newly amended particulars
of
claim still did not disclose a cause of action, alternatively were
vague or embarrassing.
39.
Amongst
other things, the Rule 23(1) notice alleged that the particulars
failed to sustain a cause of action on the basis that the
facts
alleged by the plaintiff failed to disclose any causal link between
the alleged negligence of the defendant and the suggested
prejudice
of the plaintiff; that certain of the damages sustained by the
plaintiff accrued prior to the act upon which the
plaintiff relies
for the causing of such damages; and that the particulars fail
to disclose a cause of action upon which
the plaintiff alleges that
the defendant's conduct was wrongful and negligent.
40.
No
notice of intention to amend the particulars of claim consequent upon
this Rule 23(1) notice has been delivered.
41.
Prior
to the hearing of this matter on Tuesday, 26 May 2015, the
plaintiff and the defendant delivered heads of argument.
42.
The
defendant's heads of argument were terse, to say the least.
43.
In
those heads of argument it was contended that the 16 August 2012
letter complied with the provisions of s 3(2) of the
ILP Act on
the basis that it was sent within six months of February 2012, being
the date on which the debt became due. If
that were the case,
there would have been no necessity for the plaintiff to seek
condonation for non-compliance with the ILP Act
and this application
would have been rendered redundant.
44.
However,
at the commencement of the hearing, Mr Whitaker, who appeared for the
defendant but who did not draft the plaintiff's heads
of argument,
disavowed that submission contained in the plaintiff's heads of
argument and proceeded to argue the matter on the
basis that there
had not been compliance with the ILP Act and, as a consequence,
persisted with the plaintiff's application for
condonation.
45.
S 3(4)
of the ILP Act provides as follows:
"
(a) If an organ of state relies on a
creditor's failure to serve a notice in terms of subsection (2)(a),
the creditor may apply
to a court having jurisdiction for condonation
of such failure.
(b) The court may grant an application
referred to in paragraph (a) if it is satisfied that -
(i) the debt has not been extinguished by
prescription;
(ii) good cause exists for the failure by
the creditor; and
(iii) the organ of state was not
unreasonably prejudiced by the failure.
"
46.
In
this matter, the issue of prescription does not arise on the case as
presently pleaded by the plaintiff. No more needs
to be said on
that account.
47.
The
two issues which do arise are whether the plaintiff has established
good cause for his failure to give the required notice and
whether
the plaintiff has established that the defendant was not unreasonably
prejudiced by his failure to give such notice.
48.
It is now settled law that the "
good
cause
" requirement contained in
the ILP Act will be met by an applicant who not only has furnished an
explanation of his default
sufficiently fully in order for the Court
to understand how it came about and thereby to assess his conduct and
motives, but also
by an applicant who is able to show some prospects
of success on the merits of his case.
[2]
In
Rance
the SCA pointed out that an applicant acts at his own peril when a
Court is left in the dark on the merits of an intended action.
49.
In
casu
, it was argued by Mr Whitaker that
the failure to give the requisite notice could not be laid at the
plaintiff's door and was occasioned
solely as a result of an
oversight on the part of his attorney.
50.
It
is correct that in the founding affirmation the plaintiff admitted
that he had failed to give the requisite notice and alleged
that such
failure was due to an oversight on the part of his attorney. He
averred that notice was only given in October 2013
after receipt of
the defendant's first Rule 23(1) notice.
51.
However,
in the supplementary affirmation, the plaintiff painted a vastly
different picture.
52.
In
the supplementary founding affirmation the plaintiff alleged, as I
have indicated, that his damages only manifested themselves
in
February 2012 when the property was sold in execution. He then
alleged that the August 2012 letter was written by his
attorney.
As this was within the six months from the date on which he now
alleged the debt became due, he alleged that there
had been
compliance with the ILP Act. In fact, he alleged that it was
only after the property was sold in execution that
he realised that
he had no alternative but to seek compensation from the defendant
and, pursuant thereto, he instructed his attorneys
to institute legal
proceedings against the defendant. He alleged that his
attorneys then instructed counsel to prepare the
necessary documents
and he trusted that all the prerequisites would be complied with.
He accordingly alleged that, pursuant
to those instructions, the
August letter was written and, in the absence of a response, summons
was issued.
53.
This
explanation is fraught with difficulty.
54.
Firstly,
he affirmed positively that his damages only manifested themselves on
the sale in execution of the property on 12 February
2012 and
that, as a consequence thereof, he sought advice on his damages
claim. This is demonstrably untrue. The property
was only sold
in execution in October 2012. The error is not immaterial.
It permeates everything that follows.
55.
The
allegation that the property was sold in execution in February 2012
and that this was the catalyst for his claim for damages
was made in
order to demonstrate that his claim only became due in February 2012
and that his attorney's letter of August 2012
thus constituted
notice, as required by the ILP Act. He also states clearly in
his affirmation that it was only after the
sale in execution that he
sought advice in respect of a claim against the defendant and that it
was after he sought such advice
that the August 2012 letter was
written. If all of this was correct, then non-compliance with
the ILP Act would not arise.
For good measure, these
allegations, if they bore scrutiny, would also absolve his attorneys
from any blame.
56.
But
of course, as a fact, the property was not sold in execution in
February 2012 but only in October 2012. It follows, as
night
follows day, that he did not only realise that he had a damages claim
against the defendant when the property was sold in
execution and
only then seek legal advice on a potential claim, because the August
letter written by his attorney pre-dated the
sale in execution by
some months. In fact the letter itself refers to claims which
had arisen prior to February 2012 and
to a possible claim that may
arise once the property has been sold in execution.
57.
Whilst
Mr Whitaker sought to disavow any reliance on the allegations
relating to the August letter, the difficulty which he and
the
plaintiff face is that the plaintiff has affirmed two mutually
irreconcilable versions.
58.
On
the first version, he admits that there was non-compliance with the
ILP Act and seeks to apportion blame for that non-compliance
on his
attorney.
59.
On
the second version, and in an effort to avoid having to apply for
condonation, he avers that there was in fact compliance with
the ILP
Act and therefore no oversight on the part of his attorney.
60.
In
order for the Court to be satisfied that he has an adequate
explanation for his default, the plaintiff must fully explain the
default in order for the Court to understand his motives and
conduct. It goes without saying that the explanation must be
an
honest one.
61.
In
this case I am faced with contradictory factual versions, one of
which is demonstrably untrue and which was advanced with the
sole
purpose of avoiding the consequence of failing to comply with the ILP
Act. The other explanation simply alleges that
no notice was
given and that this was due to an oversight on the part of his
attorney.
62.
The
fact that the plaintiff was willing to affirm a demonstrably false
version of events in order to escape the consequences of
his failure
to comply with the ILP Act causes me to have grave doubts about the
factual version which he now wishes the Court to
accept. Put
bluntly, having lied in the supplementary affirmation, with the
specific purpose of avoiding the consequences
of not having given
notice, causes me to doubt the veracity of that contained in the
founding affirmation. This doubt
is exacerbated by the
fact that his attorney has not deposed to an affidavit explaining
what happened.
63.
I
am accordingly not satisfied that the plaintiff has adequately
explained the reason for his failure to give the required notice.
64.
That,
however, is not necessarily the end of the matter, as both
Rance
and
Madinda
have indicated that good prospects of success on the merits may
compensate for a poor explanation in respect of the failure to
give
the requisite notice.
65.
Unfortunately
for the plaintiff, he also fails miserably on this count.
Indeed, Mr Whitake conceded that the exception to
the amended
particulars of claim was good.
66.
Mr
Whitaker, however, urged me to bear in mind that the plaintiff may be
able to amend his particulars of claim to avoid the consequences
of
the exception. The difficulty with that proposition is that no
amendment was placed before me and I am not able to gaze
into a
crystal ball and divine what amendments, if any, the plaintiff may
make to render his claim inexcipiable. I must decide
the matter
on the case as presently pleaded and, as presently pleaded, the case
is bad. But even if I were able to speculate
on what
amendments, if any, the plaintiff was able to make, I will still be
in the dark as to whether those as yet unknown allegations
will not
only contain a sustainable cause of action but will enjoy some
prospects of being established at a trial. Apart
from simply
referring to allegations in his various particulars of claim, the
plaintiff has chosen not to disclose any of the evidence
available to
him which could indicate that he enjoys some prospects of success at
a trial. In my view, the plaintiff has
not established any
prospects of success in the action.
67.
In
the circumstances I am satisfied that the plaintiff has not
established that good cause exists for his failure to have complied
with the ILP Act. In the circumstances it is not necessary for
me to consider whether or not the defendant has been unreasonably
prejudiced by the failure to give the notice.
68.
I
accordingly make the following order:
(1) The application is dismissed with costs, such
costs to include the costs of two counsel.
MANCA AJ
Acting Judge of the High Court
[1]
See paragraph 6 above.
[2]
See
Madinda v
Minister of Safety & Security
[2008] ZASCA 34
;
[2008] 3 All SA 143
(SCA) and
Minister
of Agriculture and Land Affairs v C J Rance (Pty) Ltd
[2010]
3 All SA 537
(SCA).