Body Corporate of Hazelhurst v Ramadzhiya (13932/2013) [2017] ZAGPPHC 1090 (27 October 2017)

IN THE HIGH COURT OF SOUTH AFRICA

(GAUTENG DIVISON, PRETORIA)

(1) NOT REPORTABLE

(2) NOT OF INTEREST TO OTHER JUDGES

(3) REVISED

Case No 13932/2013

27/10/2017

In the matter between:

The Body Corporate of Hazelhurst

Applicant

vs

Oscar Ramadzhiya

Respondent

JUDGMENT

Before: HOLLAND-MUTER A/J:

[1] This is an application for the sequestration of the Respondent's estate. This application was brought during 2013. The matter was postponed on several occasions before ending up before myself for hearing on 23 October 2017. I deem it not necessary to dwell into the history of all the previous times the application was before this Court save to say that every past postponement was visited with an appropriate cost order. It is also not necessary for this court to decide on those costs orders.

[2] The parties were also granted leave to file further supplementary affidavits and both parties filed subsequent supplementary affidavits. The matter was before Pretorius J; Prinsloo J and Meyer J according to the court file. I am also not requested to revisit any of those orders, specifically the costs orders. This court as a court of first instance does not have such jurisdiction.

[3] After hearing both Mr Van Rensburg and Coleman for the parties on 23 October 2017, the matter was postponed to 25 October 2017 and I requested the parties for short supplementary affidavits dealing with the current financial status of the respondent's account at the applicant. The reason was simple that in view of the very long time

lapse since the first appearance during 2013 when the application was lodged, the payment status of the respondent may have changed

significantly in view of later payments made by him to the applicant and in view of a new manager of the applicant's accounts. Propell Sectional Title Solutions (Pty) Ltd at first collected and administered the levies of the applicant. This duty was later taken over by the current manager Hanco Management &Service (Pty) Ltd on behalf of the applicant.

[4] The applicant avers in the founding affidavit that the respondent was indebted to the applicant on 23 February 2010 in the amount of R 28 149,06. A default judgment was obtained for this outstanding amount in the Magistrate's Court in Johannesburg on 14 April 2010.

[5] A warrant of execution followed with no success. The applicant then became aware that the respondent caused various notices of intention to surrender his estate to be published. The publication of the notices is not disputed by respondent save for stating that it was done by his man­ dated financial manager without his knowledge or

consent.

[6] The applicant's erstwhile attorney of record brought an application for the sequestration of the respondent's estate in the Gauteng Local Di vision, Johannesburg under case number 2014/40735 on behalf of another client, one Body Corporate of the Tandia Gardens during 2014. This application was dismissed with costs on 31 October 2016. The Court found that the respondent's estate was not factually insolvent. It seems a similar patten played out in that application as in this matter with regard to the difficulty execution judgments against the respondent's estate.

[7] In view of the time lapse since this application was brought to hearing hereof, I was concerned that the financial status of the respondent could well have changed and that status of the arrear levies ought to

clarified before the appropriate order could be granted. This led to the last set of supplementary affidavits filed on 25 October 2017 on behalf of the parties.

[8] The issue of mandate of the applicant's new financial manager, Hanco, was raised but in my view this was ill-founded. The application was pro perly issued and pending although the collection vehicle on behalf of the applicant was replaced by Hanco, it did not affect the locus standi of the applicant nor the validity of the pending application.

[9] In essence, the applicant relies on the following acts of insolvency allegedly committed by the respondent:

(1) that the respondent departed from his dwelling with the intent to evade or delay payment of his debts - section 8(a) of the Insolvency Act, Act 24 of 1936 ("The Act");

(2) that the respondent failed to satisfy judgments against him upon demand of payment- sec 8(b);

(3) that the respondent made or attempted to make dispositions of his property preferring one creditor above other creditors- sec 8(c) and 8 (d);

(4) that the respondent having published notices of intention to surrender his estate which has not lapsed or withdrawn in terms of the Act- sec 8 (f); and

(5) that the respondent' s estate was factually insolvent.

[10] During the course of the hearing it became clear that the applicant would only persist with the question of factual insolvency and section 8(b) and 8(e). The alleged acts as in sec 8 (b) was argued together with the alleged factual insolvency and the publishing of the notices of intention to surrender. I will deal with these aspects below.

[11] It is further clear that the respondent is no saint at all but largely contributed to his predicament. It was also clear that he never resided at the unit in the Hazelhurst complex but leased it to derive income, as was the position with the other immovable property owned by the respondent­ including the unit in the Tandia Gardens Complex, the subject of the above mentioned application for sequestration in the Johannesburg High Court. The respondent owns various immovable property for an income resulting in him being responsible for certain levies with regard to these properties.

[12] The fact that the respondent owns several properties, some probably not mortgaged at all, was why did the applicant not result with execution against such properties before bringing this application? It may have been much easier and more costs- and time efficient. After all, the applicant's ultimate goal is to collect the alleged arrear levies.

[13] The respondent is the owner of at least 14 properties as can be established from the Tandia Gardens application. See 531 to 535 of the paginated papers. The applicant avers this to be 11 properties.

[14] Although the respondent failed to indicate the values of each of the properties, it can be assumed that there is equity in the properties to satisfy outstanding judgments. It is further clear that the respondent does not reside in the Hazelhurst Unit and can therefore not hide behind the protection granted in Gundwana v Steko Development CC 2011 (2) SA 608 CC because on his own version he is not indigent nor does he run the risk of losing his security or place of residence. He utilizes this property to derive income such as with the other units he owns and leases to other people. The letter on his behalf on 31 October 2012 is clearly misplaced and without any merit on this aspect.

[15] Much was made of the certificate of balance Hanco Management on behalf of the applicant annexed to the supplementary affidavit by the respondent on page 384. On this certificate the outstanding balance due and payable towards the applicant in lieu of levies was R 5 732,82 on 2 October 2014. In it's supplementary reply after the respondent filed the certificate of balance, allegations of the certificate being forged was raised. See par 18.6 to 18.7 on pages 397 to 398. An affidavit by Me Me Pienawald from Hanco was annexed. She confirms the averments of the probable forging thereof.

[16] In the further supplementary affidavit filed by the respondent he explains how the certificate was obtained. The applicant also filed a further sup­ plementary affidavit on 25 October 2017, annexing a History Card­ Current (Detail) kept by Hanco. On page 4 of 14 of the History it is however stated that the opening balance on the history for October was in fact R 5 732,84, the exact amount reflected in the certificate of balance. The co-incidence of it being exactly what is reflected in the history is in my view peculiar. It has to favor the version of the respondent as set out in his latest supplementary affidavit.

[17] It is clear that the respondent is not factually insolvent. He owns several immovable property that executed to satisfy the alleged arrears on the levies.

[18] What is also confusing is that the monthly statements from Hanco as annexed by the respondent to his latest affidavit differs from the corresponding times in those annexed by the applicant in it's latest affidavit. The end result is different and it must be remembered the applicant bears the onus of prove. The applicant's explanation of how Hanco's first entry in the history was made is not convincing. On face value Hanco's first entry on the history clearly sets out an opening balance of R 123 442,17, with an entry of propell. Certain amounts are then subtracted leaving a closing balance at the end of the first month of R 2 117,06.

[19] There are references to propell next to the subtracted amounts justifying that these amounts are related or forthcoming from propell. The first amount of R 43 876,26 is exactly the same as the outstanding balance default judgment was taken for on 22 March 2012 when the new attorneys became involved. It was argued on behalf of the respondent that this is the payment made to the erstwhile manager propell by the respondent. This aspect is however unresolved at present but favors the respondent. No satisfactory explanation was given on the amount of R 79 565,91 also subtracted from the opening balance.

[20] Dealing with the publication of the notices of intention to surrender, these notices have lapsed because the intended applications were not brought on the date indicated in the publication or at the latest 14 days hereafter. See section 6(2) of the Act and Meskin, Insolvency Law 3-18. It does not retract that the publishing constitutes an act of insolvency. It however is still within the court's discretion as to whether, taking into account all the affidavits and arguments on behalf of the parties, to exercise it's discretion on the totality of the evidence.

[21] I am of the view that, the application coming for more than 4 years to date of hearing and the changed financial circumstances of the respondent since then, and the uncertainty as to the history card as presented, the applicant did not satisfy the court that it will be just under the prevailing circumstances to make a sequestration order against the estate of the respondent. Although the applicant has a judgment for more than R 200,00 against the respondent, such an order

will not be justified under the circumstances.

[22] Although the respondent at some stage had a substantial number of judgments against him, he avers that most are made good at the time of the hearing. Again, the hearing is some four (4) years after the application was brought and it is probable that the respondent has paid most of these as averred. This was also not updated.

[23] Turning to the issue of costs I am of the view, in exercising my discretion, that there are sufficient reason not to follow to normal rule that costs should follow the result. As already mentioned above, neither am I as court of first instance allowed to intervene in previous orders. Those orders were given then by the presiding judges after

considering the situation then.

[23] Mr Coleman conceded that the respondent is to a large extend the author of his own misgivings. He frustrated the applicant all along the way and is fortunate that the applicant was unsuccessful today. The respondent should have earlier payed the levies because he has sufficient means thereto. The respondent made it difficult for the applicant from the out set and under the circumstances in my view it would be fair that the respondent pay the costs of the application.

ORDER:

[24] The application is dismissed and the respondent is ordered to pay the costs of the application.

J HOLLAND-MUTER (A/J)

Acting Judge:

Gauteng Division, Pretoria

27 October 2017