Avtel (Pty) Limited v Rich Rewards Distributors (Pty) Limited and Another (64830/2016) [2018] ZAGPPHC 585 (22 June 2018)

IN THE HIGH COURT OF SOUTH AFRICA

GAUTENG DIVISION, PRETORIA

CASE NO: 64830/2016

In the matter between:

AVTEL (PTY) LIMITED

Plaintiff

And

RICH REWARDS DISTRIBUTORS (PTY) LIMITED First Defendant

WEIMAR, ROBERT PAUL

Second Defendant

REASONS FOR JUDGMENT

RAULINGA J,

[1] On 26 October 2017, I granted an order dismissing the defendants' applications for rescission of summary judgement which was granted by Van Der Westhuizen J on 11 October 2016. The defendants now request for reasons for the order so made.

[2] The defendant sought to rescind the summary judgment in terms of Rule 31(2)

(b) of the Uniform Rules of this Court, or common law.

[3] The defendant at the hearing of the rescission application contended that the parties had concluded a joint venture agreement where they each contributed to the venture sharing in the profit and loss. The second defendant states that the National Credit Act ("NCA") is applicable to the acknowledgement of debt raised against him personally.

[4] The plaintiff opposed the application on the basis that no joint venture was entered into, and that the NCA is not applicable in this case.

[5] As the plaintiff correctly states, it is common cause that the loan agreement provides repayment in the form of credits passed for the sale of Samsung S7 Edge 32 gigabyte mobile phone units. It is further common cause that the plaintiff lent and advanced, by way of payment to MTN, the amount of R1 500 000, 00. It is further not disputed that the defendants had failed to deliver any mobile phone units to the plaintiff.

[6] The defendants contend that they delivered SIM cards to the plaintiff to a value just under 50% of what was due, owing and deliverable to the plaintiff in terms of the loan agreement. However, with the defendants failing to comply with their obligations in the agreements in in forma specifica, they were in breach of and advanced. Even on the defendants' own version, they have not repaid all the money owed.

[7] The papers reveal that the first defendant is a juristic entity with a monetary asset value or annual turnover of more than R1 million as envisaged in terms of section 7, read with section 4(1) (a) (i) of the NCA, and that the second defendant is a credit grantee as envisaged in terms of section 4(2) (c) read with section 8(5) of the NCA. In the instance, the plaintiff applied to be registered as a credit provider in terms of section 40 of the NCA within 30 days from the date of conclusion of the agreements, and accordingly, such agreements are not unlawful in terms of section 89(4) (a) of the NCA. The papers reveal that the NCA is not applicable to the agreements.

[8] The powers referred to in Rule 32(2) (b) and the common law, are that the Court itself has no authority to correct, alter or supplement its final judgment or order, it becomes functus officio. The inherent jurisdiction of the High Court does not include the right to interfere with the principles of finality of judgment, other than in the circumstances specifically provided for in the rule, or the common law.

[9] In the common law a judgment can be set aside on the following grounds:

9.1 a fraud;

9.2 justus error;

9.3 exceptional circumstances when new documents have been discovered;

9.4 when judgment has been granted by default; and

9.5 In the absence between the parties of a valid agreement to support the judgment on the grounds of Justus causa.

[10] In order to succeed, an applicant for rescission of a judgment taken against him must show good cause. This generally entails that the applicant must:

10.1 give a reasonable explanation for his default;

10.2 show that his application is made bona fide; and

10.3 Show that on the merits he has a bona fide defence which prima facie carries some prospects of success.[1]

[11] In Colyn v Tiger Food Industries (Pty) Ltd t/a Meadow Feeds Mills (Cape)[2], the Court held that "in order to succeed, an applicant for rescission of a judgment taken against him by the court must show

good cause."

[12] In my view, the defendants have failed to make a proper case because all the required grounds are not present. This because the agreements themselves do not constitute a joint venture agreement. As such, no defence has been disclosed in this regard. Further, there is lack of bona tides on the part of the defendants, in that the agreements cannot constitute both a joint venture agreement and a credit agreement. The contention of the defendants is therefore vague and contradictory. Last, as I have already intimated above, the NCA is not applicable to this agreement for the reasons already stated in paragraph [7].

[13] In the result, the defendants have failed to give a reasonable explanation for the default, and further that there is no valid bona fide defence which prima facie carries some prospects of success.

[14] I make the following order

14.1 The application is dismissed with costs.

APPEARANCES

For Applicant: Adv. HP van Nieuwenhuizen

Instructed by: Tshabalala Attorneys

For Respondent: Adv G Naude, SC

Instructed by: S C Vercueil Attorneys

[1] Chetty v Law Society of Transvaal 1958 (2) SA 756 at 765B-C

[2] 2003 (6) SA (SCA)