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[2015] ZAWCHC 75
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Quince Property Finance (Pty) Ltd v Jooste and Others (A387/2014) [2015] ZAWCHC 75 (2 June 2015)
Republic
of South Africa
IN
THE HIGH COURT OF SOUTH AFRICA
(WESTERN
CAPE DIVISION, CAPE TOWN)
CASE
NO:A387/2014
DATE:
02 JUNE 2015
Reportable
In
the matter between:
QUINCE
PROPERTY FINANCE (PTY)
LTD
......................................................................
Appellant
And
DANIEL
STEFANUS
JOOSTE
...................................................................................
First
Respondent
MARGITTE
HELOISE
SEMER
............................................................................
Second
Respondent
MARIA
MAGDALENA
HAMMAN
.........................................................................
Third
Respondent
Heard
on 22 May 2015
JUDGMENT
DELIVERED
ON 2 JUNE 2015
INTRODUCTION
1.
This is an appeal from the Magistrate’s
Court against the
ex tempore
findings and order of 9 April 2014, of the Magistrate for the
Magisterial District of Hermanus, Mr Le Roux (“the
Magistrate”).
On 9 April 2014 the Magistrate provided the
following judgment (“the judgment”) and order:
“
Die
Hof moet in hierdie aangeleentheid beslis of die nasionale Kredietwet
op die twee transaksies naamlik QPF1, die terme soos uiteengesit
op
bladsye 13 tot 14 en GPF, die terme soos uiteengesit op bladsye 17
tot 18 van toepassing is. Dit is verder so dat Eiser
nie aan
die Verweerders ‘n kennisgewing ingevolge Artikel 129 gestuur
het nie. Ingevolge die Kredietwet vorm die bepalings
van
Artikel 84(f) ‘n kredietooreenkoms. Artikel 84(f) lees
soos volg en ek haal die Afrikaanse vertaling aan:
‘
Enige
ander ooreenkoms, anders as ‘n kredietfasiliteit of
kredietwaarborg, ingevolge waarvan betaling van ‘n bedrag
teen
een persoon verskuldig aan ‘n ander uitgestel is, en enige
koste, fooie, of rente is aan die kredietverskaffer betaalbaar
ten
opsigte van 1) die ooreenkoms; of 2) die bedrag wat uitgestel is.’
Indien
die terme van bovermelde ooreenkoms bestudeer word, is ek daarvan
oortuig dat die twee ooreenkomste inderdaad krediettransaksies
is
soos bedoel in Artikel 84(f) van die Kredietwet.
Sekere
bepalings van die Kredietwet het op 1 Junie 2006 in werking getree.
Artikel 129 en 130 het egter eers op 1 Junie 2007
van krag geword.
QPF1 is op 18 en 19 Desember 2006 onderteken. QPF4 is op 23
Januarie 2007 onderteken. Skedule
3 van die Kredietwet wat op 1
Junie 2006 in werking getree word, bevat die oorgangsbepalings.
Item 4 daarvan is hier van
toepassing. Om op te som, ek gaan verder
akkoord met die argumente van die Verweerders se
regsverteenwoordiger, mnr De Villiers,
dat Eiser gebonde is aan die
Artikel 129.
Die
bevinding van die Hof is derhalwe soos volg:
Die
Hof bevind dat die spesiale pleit gehandhaaf word.
Gevolglik
word Eiser se eise van die hand gewys, met kostes.”
2.
The Appellant and the Respondents were the
Plaintiff and the First and Second Defendants respectively in the
Court
a quo
.
The Appellant is a bridging finance company. The First and Second
Respondents are the two partners of a partnership of attorneys
which
conducts such business under the name of Jooste & Semer.
3.
I
am satisfied that the appeal was prosecuted in accordance with the
Uniform Rules of the High Court (“the Uniform Rules”).
I
however point out that the Magistrate failed to comply with
Magistrate’s Court Rule 51(8)(a).
[1]
If the Magistrate had provided the statement referred to in the
aforesaid Rule, the task in dealing with this appeal would
have been
less complicated. This appeal is against the order, upholding the
First and Second Respondents’ special plea and
dismissing the
Appellant’s claims with costs.
4.
The
appeal record comprises of the pleadings before the Magistrate, the
requests for further particulars, and the replies thereto.
The
First and Second Respondents filed five detailed special pleas.
[2]
The Third Respondent was not represented it would appear, at the
hearing before the Magistrate, no order was made in respect of
the
Third Respondent, and this appeal accordingly does not involve the
Third Respondent. I will hereinafter refer to the
First and
Second Respondents collectively as the Respondents, which thus
excludes any reference to the Third Respondent.
5.
The Appellant was represented by Mr Van der
Merwe and the First and Second Respondents by Mr De Villiers.
Mr De Villiers also
appeared at the hearing in the Magistrate’s
Court for the Respondents.
6.
The
judgment and consequent order is regrettably no model of clarity and
limited in extent, the reasons provided are also of no
help in
resolving the factual and legal issues. The references to
Section 84(f) of the National Credit Act, 34 of 2005 (“the
NCA”),
[3]
and Magistrate’s
Court Rule 11(6), in the judgment as well as the reasons provided in
terms of Magistrate’s Court Rule
51(1) are clearly wrong. The
reference to Section 84(f) of the NCA is a mistake or misnomer, it is
understood that this is a reference
to Section 8(4)(f) of the NCA,
[4]
as this section falls within the context of the present litigation.
7.
A
notice in terms of Magistrate’s Court Rule 50(1) was filed by
the Appellant wherein it sought from the Magistrate a written
judgment indicating which special pleas (since there were five of
them) were upheld, the facts found to be proven, the reasons
for the
judgment and order delivered on 9 April 2014 and why the Magistrate
did not exercise his discretion in terms of Section
130(4)(b)(ii)
[5]
of the NCA, him having found that the Appellant had not complied with
the relevant provisions of the NCA.
[6]
8.
The Magistrate’s response in respect
of the notice in terms of Magistrate’s Court Rule 50(1) was,
with respect, rather
terse and confusing, his response being as
follows:
“
Met
verwysing na my bevinding gedateer 9 April 2014 wat meganies
getranskribeer is en hierby aangeheg is, wens ek om die volgende
by
te voeg.
Eiser
het in sy Besonderhede van Vordering tot sy dagvaarding nie die
vereiste soos gestel in Reël 11(6) van die Wet op Landdroshowe,
Wet 32 van 1944, nagekom nie, deurdat daar nêrens in die
Besonderhede van Vordering verwys word na die Nasionale Kredietwet,
34 van 2005 nie.”
9.
The
Magistrate was thus requested, in terms of Magistrate’s Court
Rule 51(1), to provide his written judgment. Therein the
Magistrate
expanded on his
ex
tempore
judgment by adding thereto his finding that the Appellant in its
Particulars of Claim failed to comply with Magistrate’s
Court
Rule 11(6). He also recorded that the Appellant failed to refer
to the NCA in the Appellant’s Particulars of
Claim. This
reasoning is with respect nonsensical and factually incorrect.
[7]
In any event, Magistrate’s Court Rule 11(6) has no application
whatsoever, as it deals with a consent to judgment.
BACKGROUND
10.
In
the Appellant’s
[8]
heads
of argument it is submitted that it is pertinently clear what the
position was with regard to the second to fifth special
pleas at the
hearing before the Magistrate, and that such special pleas were
abandoned by the Respondents when argument was presented
to the
Magistrate. To this the Respondents have not alluded to in the
heads of argument filed on their behalf, the parties
thus have
divergent views regarding what happened to the remaining special
pleas. It is in my view, however apparent, that
there could not
have been an abandonment of the other four special pleas. In
argument Mr De Villiers conceded that the first
special plea was what
was adjudicated before the Magistrate, and it is clear that this was
the case before the Magistrate, if cognisance
is taken of the content
of the judgment and order.
11.
As far as the pleadings are concerned, the
following is of relevance:
11.1.
In
paragraphs 24 and 25 of the Appellant’s Particulars of Claim it
is alleged that the Respondents are a juristic person as
defined in
Section 4(1)(a)(i) of the NCA.
[9]
However, the NCA, it is alleged in such Particulars of Claim, was not
applicable in respect of the Respondents’ partnership
due to
the provisions of Section 4(1)(a) of the NCA, this was because the
Respondents’ asset value or annual turnover equals
or exceeds
the R1 million threshold.
[10]
11.2.
In paragraph 33 of the Respondents’
plea it is denied that the Respondents were not a juristic person in
the form of a partnership,
and that the NCA did not apply in relation
to the Respondents, in that they exceeded the threshold requirements
laid down in Section
7(1) of the NCA.
11.3.
It
was specifically pleaded, by the Respondents, that the Appellants
failed to comply with the provisions of Section 129 of the
NCA,
accordingly it was contended that the legal proceedings instituted by
the Appellant were premature.
[11]
11.4.
A
request for further particulars was filed by the Appellant, wherein
the Respondents were requested to provide information regarding
the
Respondents’ combined asset value or yearly turnover, clearly
to see whether the provisions of Section 4(1)(a)(i) of
the NCA
apply. Detailed figures and supporting documents and a request
for the provision of information which would assist
the Appellant in
deciding why the Respondents contended that Section 4(1)(a) of the
NCA did apply, was requested.
[12]
The Respondents replied thereto that the Respondents’ turnover
as at 28 February 2007 was R515 217,00 and its owners’
interest R93 681,00, the Respondents attached their financial
statements for the relevant period as at 28 February 2007. In
furtherance of their response, the Respondents specifically stated
that the Respondents’ combined turnover and combined asset
value was less than the threshold as set out in Section 7(1) of the
NCA.
11.5.
It is clear from the information provided
by the Respondents to the Appellant, that in the Respondents’
view the Respondents
were a juristic person and that the NCA did
apply.
12.
On the pleadings read with the requests for
further particulars and the answers thereto, it is apparent that the
question of whether
the Appellant had to comply with the NCA and its
provisions, was heavily disputed.
THE
FACTS
13.
The facts are in essence common cause, save
for the differences in interpretation regarding the written documents
which are attached
to the Plaintiff’s Particulars of Claim.
The Appellant, in order to set out its cause of action, attaches to
its Particulars
of Claim applications for bridging finance (annexures
“QPF1” and “QPF4”) (“the bridging
finance agreements”),
letters of undertaking written on the
Respondents’ letterhead by their conveyancing secretary on 19
December 2006 (annexures
“QPF2” and “QPF5”)
(“the letters of undertaking”) and schedules setting out
certain calculations
regarding what amounts would be available to be
paid to creditors in respect of a certain conveyancing transaction
involving the
late Mr B J Davids (“Mr Davids”), pursuant
to the registration of a mortgage bond over certain immovable
property of
which Mr Davids was the owner.
14.
The Appellant contends that the letters of
undertaking bound the Respondents to repay any shortfall in respect
of the moneys paid
to the debtor in terms of the bridging finance
agreements inclusive of interest, but that the letters of undertaking
do not constitute
credit agreements. In essence on face value
the letters of undertaking are credit guarantees premised upon the
bridging finance
agreements. The Appellant however in the
Magistrate’s Court and again in this Court contended that the
letters of undertaking
are not credit agreements which are subject to
the NCA. Mr Van der Merwe rightly so conceded that the bridging
finance agreements
were in fact credit agreements falling within the
meaning of the NCA.
15.
Both the applications for bridging finance
are identical and contain the following wording:
“
5.
FINANCING AGREEMENT
ZS
Rational Finance (Pty) Ltd (‘ZS Rational’) will advance
money to the Borrower under the following terms and conditions,
on
which the parties agree:
5.1
The Borrower is entitled to the proceeds from either the sale of
property or a mortgage bond and the Borrower wishes to borrow
money
from ZS Rational.
5.2
The Borrower agrees to pay the said sum as set out hereunder to ZS
Rational:
5.2.1
Advanced amount
5.2.2
Application fee: R300
5.2.3
Finance charge: 1.4 % per month (16.6 % per annum)
5.2.4
Service charge: 1.6 % per month
5.2.5
VAT calculated at 14 % will be payable on 5.2.2 and 5.2.4
5.3
The amount advanced shall be paid into the Attorney’s Trust
Account on behalf of the Borrower, or such other account that
the
Borrower may appoint in writing.
5.5
For this purpose the Borrower cedes, transfers and makes over to ZS
Rational his right, title and interest in said to the surplus
of the
proceeds such cession and transfer shall be of full force and effect,
without any further act of delivery.
5.6
The outstanding amount will be calculated on a day-to-day basis from
the date that the amount is advanced to the date of payment.
5.7
In the event of the Deed of Sale or the bond registration being
cancelled for whatsoever reason, or within 90 days after the
amount
has been advanced, which ever may be the soonest, the amount so
advanced shall become due and payable immediately.
6.
UNDERTAKING BY THE ATTORNEY
The
Attorney undertakes to ZS Rational that:
6.1
The Sale / Mortgage Agreement is enforceable in law and contains all
the terms and conditions between the Purchaser and the
Buyer or
between the Mortgager and the Bond Grantor and the said parties have
the necessary authority to bind themselves.
6.2
To that extent that the Sale / Mortgage Agreement contains any
suspensive condition, such condition has been fulfilled.
6.3
All relevant documentation required for the transfer of the property
involved or the registration of the bond have been signed
by all the
relevant persons and that there is no impediment thereto.
6.4
He has been instructed by the Seller, Purchaser, Mortgager, or Bond
Grantor to attend to and is proceeding with the transfer
of the
property or the registration of a bond.
6.5
He has received an irrevocable mandate from the Borrower that upon
the transfer of the property or registration of a bond he
is to pay
so much of the proceeds of the sale or bond to ZS Rational that is
due and owing in terms of the above agreement between
ZS Rational and
the Borrower.
6.6
He has accepted such instruction and will supply ZS Rational with an
independent undertaking, which shall not derogate in any
way from
these warranties.
6.7
No other person or institution has any other claim to the surplus of
the proceeds of the sale or bond.
6.8
No other undertakings have been given which will reduce the proceeds
to an amount less than the amount due and owing to ZS Rational
in
terms of the agreement between ZS Rational and the Borrower.
6.9
This undertaking is subject to any claim by the Commissioner of
Inland Revenue and any obligation on him as an agent for the
said
Commission in terms of Section 99 of the Income Tax Act of 1962 as
amended, and or any Court Order prohibiting him from doing
so.
6.10
He shall keep ZS Rational informed to matters relating to the
transfer of the property or registration of the Bond. In general
and
in particular in regard to any event or circumstance which may arise
subsequent to the signing of this agreement.
6.11
In the event of the transaction being cancelled, the Borrower and/or
the Attorney shall immediately advise ZS Rational of such
as an
occurrence.
6.12
If this agreement is entered into and signed by the Attorney on
behalf of the Borrower, he warrants that he is duly authorised
to do
so.”
16.
Both the letters of undertaking contain the
following wording:
“
We
undertake to pay to you on registration the amount of R38 000,00
plus costs and interest, which amount shall be paid directly
into
your bank account. Please let us have your banking details.”
“
We
undertake to pay to you on registration the amount of R20 000,00
plus costs and interest, which amount shall be paid directly
into
your bank account. Please let us have your banking details.”
17.
In
the Particulars of Claim the Appellant states that it is a registered
credit provider
[13]
and that
the Respondents are, given the fact that they are a firm of attorneys
and practicing under the name and style of Jooste
& Semer, a
juristic person as defined in the NCA. The Appellant then
pleads that due to the provisions of Section 4(1)(a)
of the NCA and
because the Respondents’ asset value or annual turnover equals
or exceeds R1 million (One Million Rand) the
NCA is not applicable.
This is denied in the Respondents’ answer to the Appellant’s
request for further particulars.
[14]
The Appellant contends that to determine whether a partnership is a
juristic entity in terms of the NCA, and whether the
NCA applies to
the Respondent, in that the threshold requirements as set out in
Section 7(1) of the NCA apply, oral evidence in
respect of such
issues would be required. The issues whether the Respondents
are a juristic person and whether the threshold
requirements
contained in Section 7(1) of the NCA are met, were thus placed in
dispute by the Appellant.
18.
In paragraph 33 of the Respondents’
plea it is denied that:
18.1.
the NCA does not apply to the Respondents;
and
18.2.
the
Appellant is exempted from complying with the provisions of Section
129 of the NCA, in terms whereof a notice of intended legal
action is
to be given to a debtor.
[15]
THE
ISSUES
19.
The issues to be decided are limited to the
following:
19.1.
Did the Magistrate err in deciding that the
bridging finance agreements and the letters of undertaking were in
fact credit agreements
subject to the NCA’s provisions.
19.2.
Did the Magistrate err in not deciding:
19.2.1.
whether or not the Respondents were a
juristic person;
19.2.2.
whether or not the Respondents were subject
to the threshold requirements in Section 7(1) of the NCA, making the
NCA applicable
or not applicable;
19.2.3.
whether or not the Appellant ought to have
been given a respite as envisaged in terms of Section 130(4)(b) of
the NCA;
19.2.4.
if the NCA applied, what steps were to be
followed by the Appellant.
THE
LEGAL PRINCIPLES
20.
The NCA applies only to a credit agreement
when an agreement is regarded as a credit agreement for purposes of
the NCA if it is
a credit facility, credit transaction, credit
guarantee or a combination of these.
21.
A credit agreement is defined as follows in
the NCA:
“
8(5)
An agreement, irrespective of its form but not including an agreement
contemplated in subsection (2), constitutes a credit
guarantee if, in
terms of that agreement, a person undertakes or promises to satisfy
upon demand any obligation of another consumer
in terms of a credit
facility or a credit transaction to which this Act applies.”
22.
A credit agreement to which the NCA applies
has two main elements:
22.1.
credit that is granted, in other words, the
consumer’s obligation to pay an amount owed to the credit
provider is deferred;
and
22.2.
a
fee, charge of interest in respect of the deferred payment (or
repayment).
[16]
23.
Once
it is determined that an agreement is a credit agreement, the next
enquiry is whether the agreement was entered into between
the parties
dealing at arm’s length. A credit agreement which is not at
arm’s length is not affected by the provisions
of the NCA.
[17]
24.
The
NCA also does not apply in respect of agreements where the consumer
is a juristic person whose asset value or annual turnover,
together
with that of all its related juristic persons equals or exceeds R1
million.
[18]
25.
In the definitions section to the NCA a
juristic person is defined as, including a partnership, association
or other party of persons
corporate or unincorporated, or a trust.
26.
In
Absa
Bank Ltd v Mkhize and two similar cases
[19]
the Supreme Court of Appeal provided the following guidelines to a
credit provider in complying with Section 129 of the NCA:
“
[51]
I do not think it necessary to go so far. The purpose of s
130(4)
(b)
is
to require the court, where a credit provider has not complied with
any provision of the NCA (in this instance it would
be non-compliance
with s 129(1), as interpreted in
Sebola
),
to adjourn the matter and 'make an appropriate order setting out the
steps the credit provider must complete before the matter
may be
resumed'. Once the credit provider complies with the court
order, when the matter is set down again the court will
doubtless be
able to grant judgment. As Alkema J pointed out, the adjournment
will increase the burden on the credit provider
and on the courts,
and will of course increase the cost of providing credit. But that is
the consequence of the poorly drafted
NCA and the interpretation of
its provisions by the Constitutional Court. That court appreciated
that consumers would bear the
additional costs of obtaining credit by
requiring proof of receipt of notices sent by registered mail at post
offices. But that
was warranted by the importance of ensuring that s
129(1) notices be provided to consumers. Cameron J said:
'I
accept that this judgment may heighten the cost of credit and that
this will affect the pockets of not only credit institutions
but
also consumers, particularly those new to the credit market. That is
a social burden the legislation imposes. The alternative
would be to
underplay the importance of the notice, and under-weigh the impact of
the wording of s 129.'
[52]
The costs of adjourning matters so that credit providers can
take further steps and give evidence by way of affidavit
to
establish 'to the best of the plaintiff's ability that the notice was
provided to' the consumer and explaining the credit provider's
choice
of mode of delivery, will add to that which would have been foreseen
by the Constitutional Court. But that does not make
the order of the
high court incorrect.”
27.
Section 8(5) of the NCA provides that an
agreement constitutes a credit guarantee if, in terms of that
agreement, a person undertakes
or promises to satisfy, upon demand,
any obligation of another consumer in terms of a credit facility or a
credit transaction to
which the NCA applies. An ordinary
common-law suretyship where one person provides security for another
one’s debts
constitutes a credit guarantee for purposes of the
NCA.
28.
It is clear that the NCA applies to a
credit guarantee only to the extent that it applies to the primary
debt secured by the guarantee.
If the NCA does not apply to the
credit facility or credit transaction in respect of which the
guarantee is granted, it does not
apply to the credit guarantee.
The NCA therefore does not apply to a suretyship granted by a person
for the debts of a juristic
person which is a large juristic person
or which has concluded a large agreement for purposes of the NCA.
DISCUSSION
29.
In
the Appellant’s
[20]
heads of argument it is submitted that all of the special pleas filed
by the Respondents which were set down to be determined on
9 April
2014, save for the first special plea, were abandoned, when the
matter was argued before the Magistrate, without any evidence
being
presented. If one has regard to the judgment it appears that
the Magistrate upheld the first special plea and did not
deal with
the remaining special pleas. Accordingly all that this Court is
capable of adjudicating is the order upholding
the first special
plea.
30.
At the hearing in the Magistrate’s
Court, the parties seem to have agreed that the
onus
to prove the first special plea rested on the Respondents. The
Respondents appear not to have elected to lead any evidence
in
support of the first special plea, the first special plea was
accordingly argued on the pleadings before the Magistrate. It
is
however common cause that the Appellant and Respondents held
diametrically opposed views whether the Appellant had to comply
with
the NCA and whether the requisite jurisdictional facts existed
compelling the Appellant to comply with the NCA.
31.
The first special plea was thus argued
without any evidence being led. It is also unclear, as to
whether any of the allegations
contained in the first special plea
and replies to the requests for further particulars, were considered
to be correct or not,
or even conceded. All questions
pertaining to compliance with the NCA or not, thus remained alive.
32.
This Court cannot be called upon to
reconstruct what took place in the Magistrate’s Court when the
first special plea was
argued. The parties’ legal
representatives only have themselves to blame, given the limited
extent of the judgment, and I
cannot go beyond the contents of such
judgment.
33.
The
order against which this appeal lies, only deals with the first
special plea which in a nutshell is aimed at both the Appellant’s
claims A and B. This special plea is premised on the fact that
the Appellant’s claims are subject to Sections 129 and
130 of
the NCA, in that “QFP1” and “QFP4” are credit
agreements and “QFP2” and “QFP5”
are credit
guarantees. In addition, the appeal lies against the finding
that the Appellant failed to comply with Section
129(1)(a) of the
NCA
[21]
by drawing the default
to the Respondents’ attention, therefore the Appellant was not
empowered to commence any legal proceedings
to enforce the bridging
finance agreements and the letters of guarantee.
34.
In the first special plea, the Respondents
claimed that both claims of the Appellant had to be dismissed on the
grounds that:
34.1.
Their obligations in terms of clauses 6.6
of the bridging finance agreement annexed to the Appellant’s
Particulars of Claim,
marked “QPF1” and “QPF4”,
constitute credit guarantees within the meaning of Section 8(12) of
the NCA.
34.2.
The Appellant failed to comply with the
provisions of Section 129, as read with Section 130 of the NCA, prior
to instituting the
action.
35.
The Appellant submits that the letters of
undertaking by the Respondents do not constitute credit guarantees,
let alone credit transactions.
I cannot agree with this submission as
it is clear that the tenor of “QPF1” and “QPF4”
is that a credit
agreement is constituted together with an
undertaking or guarantee that certain steps and actions will be
undertaken by the Respondents
dependant on certain events, and that
payment would be made to the Appellant in such circumstances.
36.
It thus follows that the Magistrate was
correct in finding that the bridging finance agreement and the
letters of undertaking were
credit agreements in terms of the NCA,
but failed to consider whether:
36.1.
the Respondent was a juristic person;
36.2.
the threshold requirement in Section
4(1)(a)(i) of the NCA had been met;
36.3.
the Appellant to proceed with claims A and
B had to comply with the NCA;
36.4.
the Appellant was to have given notice in
terms of Section 129 of the NCA to the Respondents;
36.5.
in the event of the Appellant not having
given the requisite notice in terms of Section 129 of the Act, what
the Appellant ought
to have done in such circumstance.
37.
If the Respondents had presented evidence
regarding the threshold requirements, then in that event this appeal
could have been dealt
with in a more cost effective and effective
manner. The Respondents however did not present any evidence in
this regard,
and for this reason the Appellant, in my view, is only
partly successful with this appeal, which clearly impacts upon the
issue
of costs. I have a wide discretion in this regard and
intend to exercise such discretion in consideration of fairness and
justice.
38.
It
was the Respondents who raised the special pleas and who, in the
circumstances, ought to have presented their case in accordance
with
the law, and on a proper basis, given the disputes as they
materialised at the time of the hearing. On the other hand,
the
Appellant has only been partly successful, therefore in the
circumstances the costs should not follow the result, but each
party
should be ordered to pay their own costs. In any event, the
general rule that costs follow the event is not applied
as rigidly on
appeal.
[22]
FINDING
39.
The following findings are made on appeal:
39.1.
Only the first special plea was adjudicated
before the Magistrate.
39.2.
The bridging finance agreement and the
letter of undertaking are credit agreements in terms of the NCA.
39.3.
The Magistrate did not determine:
39.3.1.
whether the Respondent was a juristic
person;
39.3.2.
whether there had been compliance with
Section 129 of the Act;
39.3.3.
what steps the Appellant was to take if
there was non-compliance with Section 129 of the Act.
ORDER
40.
I would make the following order.
41.
The appeal is upheld to the extent set out
below with the costs order being set aside, the matter is referred
back to the Magistrate,
to determine, in respect of the first special
plea:
41.1.
whether the Respondent was a juristic
person;
41.2.
whether there had been compliance with
Section 129 of the Act;
41.3.
whether the Appellant is entitled to the
respite provided in terms of Section 130(4)(b)(i) and (ii) of the
NCA;
41.4.
what steps are to be undertaken by the
Appellant if the NCA applies and the Appellant is to give notice in
terms of Section 129
of the Act;
41.5.
the issue of costs in adjudicating the
Respondents’ first special plea.
42.
Each party is to pay their own costs in
respect of this appeal.
FERREIRA,
AJ
I
concur and it is so ordered.
HLOPHE,
JP
[1]
“
(8)
(a) Upon the delivery of a notice of appeal the relevant judicial
officer shall within 15 days thereafter hand to the registrar
or
clerk of the court a statement in writing showing (so far as may be
necessary having regard to any judgment in writing already
handed in
by him or her) (i) the facts he or she found to be proved; (ii)
the grounds upon which he or she arrived at any
finding of fact
specified in the notice of appeal as appealed against; and (iii) his
or her reasons for any ruling of law or
for the admission or
rejection of any evidence so specified as appealed against.”
[2]
Record,
pp 71 to 73
[3]
Section
84 does not have a sub-section (f), and relates specifically to the
effect of the suspension of a credit agreement.
[4]
“
(4)
An agreement, irrespective of its form but not including an
agreement contemplated in subsection (2), constitutes a credit
transaction if it is-
(a)
a
pawn transaction or discount transaction;
(b)
an
incidental credit agreement, subject to section 5 (2);
(c)
an
instalment agreement;
(d)
a
mortgage agreement or secured loan;
(e)
a
lease; or
(f)
any
other agreement, other than a credit facility or credit guarantee,
in terms of which payment of an amount
owed by one person to another
is deferred, and any charge, fee or interest is payable to the
credit provider in respect of-
(I)
the agreement; or
(ii)
the amount that has been deferred.”
[5]
“
(4)
In any proceedings contemplated in this section, if the court
determines that-
(a)
…
(b)
the
credit provider has not complied with the relevant provisions of
this Act, as contemplated in subsection (3)
(a)
,
or has approached the court in circumstances contemplated in
subsection (3)
(c)
the
court must-
(I)
…
(ii)
make an appropriate order setting out the steps the credit provider
must complete before the matter may be resumed;”
[6]
The
Appellant’s counsel also takes this point in paragraphs 50 and
51 of his heads of argument.
[7]
Rule
11(6):
“
(6)
When a defendant has consented to judgment, the registrar or clerk
of the court shall, subject to section 58 of the Act and
rule 12(5),
(6) and (7), enter judgment in terms of the defendant's consent:
Provided that where such consent to judgment is
contained in
defendant's plea, the registrar or clerk of the court shall refer
the matter to the court and the court may thereupon
exercise its
powers under rule 12(7).”
[8]
Footnote
21
[9]
Read
with the definition in respect of a juristic person.
[10]
Record,
p 11
[11]
Record,
p 72, paragraph 1.6
[12]
Record,
p 107
[13]
Record,
p 11
[14]
Record,
pp 105 and 106
[15]
Record,
pp 88 and 89
[16]
Evans
v Smith
2011(4)
SA 472 (WCC) at paras [16] to [19]
[17]
Section
4(2)(b)
[18]
Section
4(1)(a)(i)
[19]
2014(5)
SA 16 (SCA) at [51] and 52]
[20]
Footnote
18
[21]
“
(3)
Despite any provision of law or contract to the contrary, in any
proceedings commenced in a court in respect of a credit agreement
to
which this Act applies, the court may determine the matter only if
the court is satisfied that-
(a)
in the case of
proceedings to which sections 127, 129 or 131 apply, the procedures
required by those sections have been complied
with;
(b)
there is no
matter arising under that credit agreement, and pending before the
Tribunal, that could result in an order affecting
the issues to be
determined by the court; and
(c)
that
the credit provider has not approached the court-
(i)
during the time that the matter was before a debt counsellor,
alternative dispute resolution agent, consumer court or the
ombud
with jurisdiction; or
(ii)
despite the consumer having-
(aa)
surrendered
property to the credit provider, and before that property has been
sold;
(bb)
agreed
to a proposal made in terms of section 129 (1)
(a)
and
acted in good faith in fulfilment of that agreement;
(cc)
complied
with an agreed plan as contemplated in section 129 (1)
(a)
;
or
(dd)
brought
the payments under the credit agreement up to date, as contemplated
in section 129 (1)
(a)
.
(4)
In any proceedings contemplated in this section, if the court
determines that-
(a)
the credit agreement was
reckless as described in section 80, the court must make an order
contemplated in section 83;
(b)
the
credit provider has not complied with the relevant provisions of
this Act, as contemplated in subsection (3)
(a)
,
or has approached the court in circumstances contemplated in
subsection (3)
(c)
the
court must-
(i)
adjourn the matter before it; and
(ii)
make an appropriate order setting out the steps the credit provider
must complete before the matter may be resumed;
(c)
the
credit agreement is subject to a pending debt review in terms of
Part D of Chapter 4, the court may-
(i)
adjourn the matter, pending a final determination of the debt review
proceedings;
(ii)
order the debt counsellor to report directly to the court, and
thereafter make an order contemplated in section 85
(b)
; or
(iii)
if the credit agreement is the only credit agreement to which the
consumer is a party, order the debt counsellor to discontinue
the
debt review proceedings, and make an order contemplated in section
85
(b)
;
(d)
there
is a matter pending before the Tribunal, as contemplated in
subsection (3)
(b)
,
the court may-
(i)
adjourn the matter before it, pending a determination of the
proceedings before the Tribunal; or
(ii)
order the Tribunal to adjourn the proceedings before it, and refer
the matter to the court for determination; or
(e)
the
credit agreement is either suspended or subject to a debt
re-arrangement order or agreement, and the consumer has complied
with that order or agreement, the court must dismiss the matter.”
[22]
Law
of Costs
:
AC Cilliers: Butterworths, paragraph 14-09