Cole v Kallie; In re: Kallie v Cole and Others (03863/2014) [2016] ZAGPJHC 206 (29 July 2016)

REPUBLIC OF SOUTH AFRICA

IN THE HIGH COURT OF SOUTH AFRICA,

GAUTENG LOCAL DIVISION, JOHANNESBURG

DATE: 29 July 2016

CASE NO: 03863/2014

In the matter between:-

COLE, ALLISTER GORDON Applicant

and

KALLIE, JARED PETER JOHN Respondent

In re:

KALLIE, JARED PETER JOHN Applicant

COLE, ALLISTER GORDON First Respondent

WE DO IT (PT) LIMITED Second Respondent

SPRING AIR INVESTMENTS 106 (PTY) LTD Third Respondent

ABSA BANK Fourth Respondent

JUDGMENT

NGOMANE AJ:

INTRODUCTION

[1] This is an application in terms of Rule 42(1)(a) of the Uniform Rules of court instituted by the Applicant in respect of an order or judgment granted in favour of the Respondent on the 16th of July 2014. The Applicant in this rescission application seeks an order to rescind and/or vary an order or judgment granted by His Lordship Mr Justice Wright (“Wright”)[1], in the main application on the aforesaid date.

[2] I shall for purpose of convenience refer to the Applicant in this application as “Cole” and the Respondent as “Kallie” respectively.

PRELIMINARIES

[3] At the commencement of the hearing of this application the parties put on record that they were no longer proceeding to argue the points in limine raised by the respondents in their heads of argument filed on the 21st January 2016, this matter is also dealt with in the applicants practice note.[2]

[4] The parties have put on record during the commencement of the hearing that the affidavits, together with the annexures, are no longer a point of contention and that it was placed on record that there will not be an issue regarding points in limine[3]. The points in limine raised by the respondent are contained in the respondent’s heads of argument[4] and have been responded thereto by the applicant on the heads of argument dated 30 October 2015. Therefore, I need not pronounce on the above points in limine save to deal with merits of the rescission application.

[5] THE FACTS

The rescission application arose due to Cole challenging the granting of the aforesaid order in the main application in favour of Kallie on the basis firstly ,that he was not served with the application and secondly, that the court was not legally competent to have granted the aforesaid order in the first place or had no jurisdiction over him as he is a peregrine of the Republic.

[6] ISSUES FOR DETERMINATION

6.1 Whether the court has jurisdiction over Cole? This matter has been raised for the first time during the filing of practice note and Heads of argument by both parties and is not raised in the Rescission application filed on behalf of Cole.

6.1.1 Whether the main application served by the Sheriff in terms of Rule 4(1)(a)(iv) to Cole’s chosen domicilium citandi et [5]executandi address at Unit Number 5, Protea Place, Bedfordview, constitutes proper service?

6.2 According to Cole, the order or judgment that had been granted in favour of Kallie, was “erroneously sought or erroneously[6] granted” by the court without service being properly effected upon him. This is contested by Kallie who contends that service was effected at Cole`s domicilium citandi address as per their agreement[7] as it was unnecessary as advised to proceed with service through edictal citation.

6.3 Counsel on behalf of Cole argued that although Cole was aware of the application, he was waiting for the application to be served by edictal citation as he is resident overseas. Cole refers to a letter of the 27th of March 2014[8] from which he assumed that the application will be served by edictal citation. I could not find anything in the afore-mentioned letter that creates the impression that the application will be served by edictal citation and I am of the view that this was merely an assumption on the part of Cole.

6.4 The application was served on Cole’s chosen domicilium citandi et executandi in terms of the shareholders agreement and therefore I find that proper service has been effected of the application on Cole. I deem it necessary to traverse on this issue by referring to authorities.

6.5 In Amcoal Collieries Ltd v Truter[9] the Court held:

“It is a matter of frequent occurrence that a domicilium citandi et executandi is chosen in a contract by one or more of the parties to it. Translated, this expression means a home for the purpose of serving summons and levying execution. (If a man chooses domicilium citandi the domicilium he chooses is taken to be his place of abode).”[10]

6.6 It is a well-established practice (which is recognised by Rule 4(1)(a(iv) of the Uniform Rules of Court) that, if a defendant has chosen a domicilium citandi et executandi, service of process at such place will be good, even though it be a vacant piece of ground, or the defendant is known to be resident abroad or has abandoned the property or cannot be found. It is generally accepted in our practice that the choice without more of a domicilium citandi et executandi is applicable only to the service of legal process in legal proceedings.

6.7 Parties to a contract may, however, choose an address for service of notices under the contract. The consequences of such a choice must in principle be the same of the choice of a domicilium citandi et executandi, (cf the Ficksburg Transpo case ubi cit), namely that service at the address chosen is good whether or not the addressee is present at the time.

6.8 Based on the above, I am satisfied that there was no basis for service to be effected in the form of edictal citation. Put differently, the Court was aware of this fact at the time the main application was heard and was not mistaken that Cole was not properly served in terms of the Rules of Court and therefore, on that ground, I reject out of hand the submission made that there was not proper service effected upon Cole, which induced the Court to erroneously grant an order under the circumstances.

6.9 In Hollard’s Estate v Kruger[11] it is held:

“Defendant the debtor under a bond chose therein domicilium citandi at the hypothecated farm. In proceedings for provisional sentence on the bond service was effected at such farm, described in the deputy-sheriff's return as the last known residence of the defendant

in the Union. The return further stated that to the deputy-sheriff's knowledge the defendant had left the country, and was reported to be living in British East Africa.”

“The choice of domicilium citandi is for the benefit of the mortgagor. It would be in his interest not to incur the additional costs of an edictal citation.”

LEGAL FRAMEWORK

[7] Section 19(1)(a) provides the following,[12]

“a provincial or local division shall have jurisdiction over all persons residing or being in and in relation to all causes arising and all offences triable within its area of jurisdiction and all other matters of which it may according to law take cognizance, and shall, subject to the provisions of subsection (2), in addition to any powers or jurisdiction which may be vested in it by law, have power”.

7.1 The new section now reads as follows:-

“A Division has jurisdiction over all persons residing in, or living in, and in relation to all causes arising … within its area of jurisdiction”.[13]

7.2 The word “jurisdiction” is capable of a number of meanings. Here it is used to denote the power or competence that a particular South African superior court has to hear and determine an issue brought before it.

7.2.1 It can appropriately be described as meaning the power vested in a division of the High Court to hear, adjudicate upon, determine and dispose of disputes between parties in a matter brought before it. It has been held that the time to determine jurisdiction is at the commencement of the action. An action commences when the summons has been issued and duly served[14]. It was held that the time of issue of the summons is the relevant time to determine jurisdiction[15]. It was held that the time at which to determine whether the Court before which the defendant is summoned is a court of competent

jurisdiction, is the date of the service of summons and not the date of its issue. It is submitted that in motion proceedings the relevant time to determine jurisdiction is the time of filing of the notice of motion at the time of delivery thereof (in cases where service has to be effected)[16].

[8] In Estate Agents Board v Lek,[17] where the issue of jurisdiction arose and the court took into account the valid consideration of convenience and common sense as relied upon this factors to found jurisdiction namely:

8.1 the applicant was resident within its area of jurisdiction;

8.2 the decision of the Board taken in Johannesburg, adversely affected his legal capacity or right to practice in Cape town as an estate agent;

8.3 the respondent did not claim any mandatory order on the Board;

8.4 every consideration of convenience and common sense indicated that the court a quo was an appropriate court to grant declaratory or empowering relief that respondent claimed;

8.5 any process, judgment or order of the court a quo would run throughout the Republic and if necessary ,could be served and have legal effect on the Board in Johannesburg

8.6 the present cause, i.e respondent`s appeal proceedings under Section 31(b) of the Estate Agents Act[18], can be said to have duly arisen or originated within the area of jurisdiction of the court a quo, which therefore had jurisdiction under Section 19(1)(a) of the Superior Court Act 59 of 1959 to hear and determine it.

[9] In casu, the respondent is resident within the area of jurisdiction of the court, namely Greenside and he selected the above court in which he should proceed as he is dominus litis;

9.1 the second Respondent, is a domesticated company, is also resident and carries business within area of the court jurisdiction;

9.2 the third Respondent ,is a domesticated company where the business of the second Respondent was carried out within area of this court;

9.3 the immovable property acquired for the carrying out of the second Respondent, is located within territorial of the court`s jurisdiction and this court always enjoys jurisdiction over where property is situated;

9.4 the grounds upon which jurisdiction can be exercised is the shareholders agreement(“agreement”) entered into by Cole and Kallie on the 15 October 2010;

9.5 the nominated domicile addresses of both Cole and Kallie on the shareholders agreement;

9.6 the performance and or running of the business relationship relating to shareholders agreement was within area of court`s jurisdiction;

9.7 the governing laws of the Republic regulating the shareholders agreement in respect of legal proceedings and any dispute arising;

9.8 the Witwatersrand local Division being selected as the non-exclusive jurisdiction for any urgent relief arising relating to shareholders agreement;

9.9 the Gauteng local Division has inherent power in terms of section 173 of the Constitution and has jurisdiction with regard to a specific territory within the Republic of SA;

[10] Accordingly, I am of the view without being exhaustive of all the jurisdictional facts, that without a shadow of doubt, the Gauteng Local Division, has power vested upon it to dispose and hear the matter and am satisfied that this court is the appropriate and convenient forum as the present cause arose within this Division.

ANALYSIS OF THE LEGAL PRINCILES INVOLVED

RULE 42

11. I now turn to discuss the relief sought in the present application. It is trite that there are ways to rescind or vary an order or judgment; inter-alia : under Rule 42(1(a) to (c), Rule 31(2)(b) and under the common law. The application is in terms of Rule 42(1)(a) and Rule 31(2)(b) and common law should be ruled out immediately and I shall deal with the application as premised below.

11.1 Before I can exercise a discretion in favour of Cole, I have taken into consideration that he was absent when the order was moved and granted , due to his failure to file a notice to oppose together with his answering affidavit. The submission on his behalf is that he is affected by the order as granted.

11.2 The rule provides that an applicant need not show good cause and that at the proof of the jurisdictional facts contained above, to rescind an order which has been “erroneously sought or erroneously granted”.

11.3 the difficulty with the present facts is that Cole admits that he was aware of the application served at his domicilium citandi et executandi as far back as on 27 March 2014. Nevertheless, he chose not to oppose the pending application set in motion by Kallie despite his contention that he wanted to exercise his right to defend the proceedings and be heard until it was too late and order or judgment granted as such.

11.4 The conduct demonstrated above does not show that Cole contemplated to resist and oppose the main application three (3) months earlier prior to the granting of the order. The aforesaid letter came to his attorney`s attention and warned of a pending application by Kallie`s. The probabilities are that his attorneys communicated to him the contents of the e-mail enclosing the notice of motion and it is apparent that such notice invites the other party to furnish a notice to oppose application and file an answering affidavit, if any within a stipulated time. Unfortunately that was not done by Cole and he still maintains that service should be proceeded with through edictal citation.

11.5 Suffice to state that the service of the application was served at his nominated domicilium citandi et executandi by virtue of a contract entered into or shareholders agreement entered between Cole and Kallie, for the purpose of regulating their business relationship.

11.6 In Van der Merwe supra, in provisional sentence proceedings where an acknowledgement of debt provided for domicilium citandi et executandi and no provision therein for change of domicilium, the application was granted against the defendant (applicant) eight (8) days after service of the summons. The defendant received the notice of the order after it had become final. The summons was served on the defendant`s domicilium and he had not personally obtained notice thereof prior to the order becoming final. It was common cause that the provisional sentence was “erroneously sought or erroneously granted in the absence of the defendant, as intended in Rule 42(1)(a).

11.7 the Court held that in terms of Rule 42(1) it had a discretion to allow an order erroneously sought or granted to stand. In casu, Cole argued that Kallie promised to serve him the application through edictal citation when the afore-said letter was dispatched to his attorneys. As I have made my finding that service was complied with and was proper at his place of abode, which was nominated on the shareholders agreement as well as the latest agreement of sale of shares, I therefore conclude that the applicant did not make out a case to set aside the prior order and no facts supporting variation or rescission has been made out. Put differently, I find that the application was not in accordance with one of the jurisdictional facts contained in Rule 42(1)(a).

CONCLUSION

[12] In the light thereof, I am not persuaded that there were any errors made, irregularities in the proceedings or facts which the court was unaware of that support that the order was “erroneously sought or granted.

ORDER

I accordingly make the following order:

1. The application is dismissed.

2. The Applicant is ordered to pay the Respondent’s costs in the application.

________________________

H NGOMANE

Acting Judge of the High Court,

Gauteng Local Division,

Johannesburg

FOR THE APPLICANT: Ms C de Villiers-Golding

INSTRUCTED BY:

RADEMEYER ATTORNEYS

FOR RESPONDENT: Mr AC Mckenzie

NATALIE LUBBE & ASSOCIATES INC

DATE OF HEARING: 10TH JUNE 2016

DATE OF JUDGMENT: 29TH JULY 2016

[1] Court order dated 16 July 2016

[2] Page 3 paragraph 5.1 to paragraph 6, 7 of the practice note

[3] paragraph 16 31, page 6 – 11

[4] paragraph 5 – 7.4

[5] Annexure WA, page 98

[6] Cole`s affidavit, paragraph14; page 7

[7] Kallie`s affidavit; paragraph 8;page 44

[8] Cole`s replying affidavit;paragraph8;page 103

[9] 1990 (1) SA 1 (A) at 5 J

[10] Pretoria Hypotheek Maatschappij v Groenewald 1916 TPD 170; Mushwana & Another v Bondev Midrand (Pty) Ltd (1415/14) [2016] ZAGPPHC 43 [15]; Van der Merwe v Bonaero Park (Edms) Bpk 1998 (1) SA 697 (T)

[11] 1932 TPD 134

[12] Supreme Court Act 59 of 1959(“Act”)

[13] Superior Courts Act 10 of 2013

[14] Mayne v Main 2001 v2 SA1239 (SCA) at 1243 under letter B-C

[15] Glen v Glen 1971 v3 SA238 (R)

[16] Terblanche nominee officio v Damiji 2003 v5) SA489(C) 498 E-F

[17] 1979(3) SA 1048(A),page 1066B-C,page 1067

[18] Act 112 of 1976