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South Africa Judgment

North Gauteng High Court, Pretoria

Body Corporate Garden v Ekoere (19470/13) [2014] ZAGPPHC 586 (15 August 2014)

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Source document

01

Holding and result

Although the respondent committed acts of insolvency and default judgments were obtained, the only proved debt was R1148. The payment of R3500 was made prior to the first judgment and not considered, and the second judgment was rescinded. The respondent's conduct was recalcitrant, but the circumstances did not justify sequestration. The court exercised its discretion and found that the application for sequestration should be dismissed.

Court disposition

Application dismissed with costs.

Orders

  • The application for sequestration is dismissed with costs.

02

Material facts

Parties

THE BODY CORPORATE GARDEN

Applicant

EMANUEL TOM EKOERE

Respondent

Amounts and remedies

  • First Default Judgment Amount: ZAR 4,848.42
  • Amount Paid Prior to First Judgment: ZAR 3,500
  • Second Default Judgment Amount: ZAR 34,017.54
  • Proved Remaining Debt: ZAR 1,148

03

Procedural history

  1. Posture

    Urgent Application / Application for Sequestration

04

Questions and positions

Legal issues

Party arguments

Applicant
The applicant argued that the respondent, as an owner in the association, failed to pay outstanding levies despite repeated requests and legal action. Two default judgments were obtained for unpaid levies, and nulla bona returns were issued. The applicant submitted that the respondent's conduct demonstrated recalcitrance and justified sequestration.
Respondent
The respondent contended that the first default judgment was wrongly granted, as a payment of R3500 had been made prior to judgment but was not considered. He disputed the service of the warrant of execution and noted that the second default judgment had been rescinded. He argued that the circumstances did not warrant sequestration.

05

Court’s reasoning

  1. 01

    Insolvency Act 24 of 1936

    The court has discretionary powers in granting sequestration and must be satisfied that the circumstances justify such an order.

  2. 02

    Body Corporate Garden v Ekoere (19470/13) [2014] ZAGPPHC 586

    A sequestration order should only be granted where there is sufficient proof of insolvency and the debt is established.

06

Ratio, limits and disposition

Ratio decidendi

Although the respondent committed acts of insolvency and default judgments were obtained, the only proved debt was R1148. The payment of R3500 was made prior to the first judgment and not considered, and the second judgment was rescinded. The respondent's conduct was recalcitrant, but the circumstances did not justify sequestration. The court exercised its discretion and found that the application for sequestration should be dismissed.

Obiter and limits

  • The applicant's frustration with the respondent's conduct is understandable, but the court must apply the law and exercise discretion appropriately.
  • There appears to be no merit in the criticism levelled at the Sheriff's return of service.

Court disposition

Application dismissed with costs.

  • The application for sequestration is dismissed with costs.

Source and reliance status

North Gauteng High Court, Pretoria

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Judgment text

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Source document

North Gauteng High Court, Pretoria

Judgment

[2014] ZAGPPHC 586

IN

THE HIGH COURT OF SOUTH AFRICA

GAUTENG DIVISION, PRETORIA

Case Number: 19470/13

Date: 15 August 2014

In the matter between

THE BODY CORPORATE GARDEN.................................................................................................Applicant

and

EMANUEL TOM EKOERE..............................................................................................................Resportdent

JUDGMENT

BAM J

1. The applicant, a home owners association, applied for an order that the respondent be sequestrated. The application is opposed. The basis for the application is that the respondent, one of eleven owners of units in the applicant's association, owes certain amounts which he refuses to pay. The legal action instituted against respondent ended up with two nulla bona returns.

2. The applicant's claim is based on two default judgments, respectively in the amounts of R4 848.42 for outstanding levies, granted under case nr. 10612/12 on 25 June 2012, and R34 017.54, also for outstanding levies, granted under case nr. 75913/12 on 17 January 2013.

3. It however transpired that in respect of the first judgement the outstanding levy was R3981.96 and that an amount of R3500 was actually paid by the respondent on 2 March 2012, before the judgment was granted. The amount paid by the respondent was not taken into account when the default judgment was sought and granted. It appears that the difference in the amount of R3500 paid by the respondent and the default judgment amount, namely R1348.42, represents legal fees.

It is the respondent's case that in the circumstances default judgment should not have been sought on the basis of outstanding levies and that it was wrongly granted.

The applicant, in its replying affidavit said that the payment of the R3550 was not made to the applicant's attorneys and that the respondent failed to inform the attorneys of the payment. The warrant of execution was served by the Sheriff on 14 August 2012. It is disputed by the respondent that the said warrant as served on him as the return of service indicates.

4. The second default judgment under case number 75193/2012 was rescinded on 6 November 2023.

5. The applicant's submission in its replying affidavit is that the respondent had been recalcitrant to pay due levies. In this regard the applicant referred to its un-contradicted allegation in the founding affidavit that the respondent from October 2011 to 7 March 2013 made only two payments in respect of levies and that no payments in that regard had been made in 2013.

6. From the papers it does appear that the applicant is experiencing difficulties in collecting due levies from the respondent. However, as far as this application for the respondent's sequestration is concerned, although the respondent has committed deeds of insolvency, the factual situation remains that the only proved debt of the respondent is the remaining amount of R1148 alluded to above.

7. The applicant's frustration with the respondent's conduct is evident and appreciated. It indeed appears that the respondent may very well be recalcitrant to pay the levies due. There also seems no merit in the criticism levelled at the Sheriffs return. However, in my view the circumstances do not justify the sequestration of the respondent. In this regard it is trite that the court has discretionary powers.

8. Accordingly I make the following order:

The application is dismissed with costs.

A J BAM

JUDGE OF THE HIGH

COURT

13 August 2014

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Authorities

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Body Corporate Garden v Ekoere (19470/13) [2014] ZAGPPHC 586

Case cited

Insolvency Act 24 of 1936

Legislation

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