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South Africa Judgment

South Gauteng High Court, Johannesburg

Engen Petroleum Limited v DAV Distribution CC t/a Willowcrest Convenience Centre (39461-2020) [2024] ZAGPJHC 207 (1 February 2024)

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01

Holding and result

The court found that the respondent's arguments regarding the nature of the section 18(3) application were unsustainable and unsupported by authority. The application for costs was triggered by the respondent's own conduct in launching and then withdrawing the application for leave to appeal without explanation. The withdrawal, coupled with the absence of any justification, indicated that the application for leave to appeal lacked merit and was intended to frustrate the applicant's rights. The general principle that costs follow the result applied, and there was no reason to depart from awarding costs on an attorney and client scale as provided for in the lease agreement. The respondent was ordered to pay the applicant's legal costs for the section 18(3) application on the attorney and client scale.

Court disposition

Respondent ordered to pay applicant's legal costs for the section 18(3) application on attorney and client scale.

Orders

  • The respondent is ordered to pay the applicant’s legal costs in respect of the section 18(3) application on attorney and client scale.

02

Material facts

Parties

Engen Petroleum Limited

Applicant Counsel: S Aucamp

DAV Distribution CC t/a Willowcrest Convenience Centre

Respondent Counsel: JM Butler

03

Procedural history

  1. Posture

    Leave to Appeal / Costs Determination Following Withdrawal of Leave to Appeal

04

Questions and positions

Legal issues

Party arguments

Applicant
The applicant argued that the section 18(3) application was necessitated by the respondent's application for leave to appeal. As the respondent withdrew its application without explanation, the applicant is out of pocket and should be allowed to recover legal costs. The applicant further contended that the withdrawal evidences malice and confirms the leave to appeal was without merit, intended only to frustrate execution of the eviction order. The applicant relied on authorities supporting the principle that a party who incurs costs due to another's conduct should be compensated.
Respondent
The respondent argued that the section 18(3) application is about the creation of rights, not the exercise of existing rights, and thus constitutes an indulgence or condonation. The respondent submitted that, as with applications to uplift the bar under rule 27, the applicant should tender costs. The respondent claimed this argument is novel and precedent-setting, and that costs should only be awarded against it if the opposition was vexatious or frivolous.

05

Court’s reasoning

  1. 01

    In re: Alluvial Create 1929 CPD 532

    Costs should follow the result unless there are compelling reasons to depart from this principle.

  2. 02

    Boost Sports v South African Breweries 2015 (5) SA 38 (SCA)

    A party who is out of pocket due to another's conduct should be allowed to recoup the loss.

  3. 03

    Mers v Abramson 1951 (3) SA 438 (C)

    Costs may be ordered against a party where opposition is frivolous.

06

Ratio, limits and disposition

Ratio decidendi

The court found that the respondent's arguments regarding the nature of the section 18(3) application were unsustainable and unsupported by authority. The application for costs was triggered by the respondent's own conduct in launching and then withdrawing the application for leave to appeal without explanation. The withdrawal, coupled with the absence of any justification, indicated that the application for leave to appeal lacked merit and was intended to frustrate the applicant's rights. The general principle that costs follow the result applied, and there was no reason to depart from awarding costs on an attorney and client scale as provided for in the lease agreement. The respondent was ordered to pay the applicant's legal costs for the section 18(3) application on the attorney and client scale.

Obiter and limits

  • The court noted that procedural rights established by section 18(3) of the Superior Court Practice Act should not be viewed differently from other rights created by the rules.
  • The respondent's argument that the section 18(3) application is akin to an indulgence under rule 27 was not substantiated and could not form the basis for a costs order against the applicant.

Court disposition

Respondent ordered to pay applicant's legal costs for the section 18(3) application on attorney and client scale.

  • The respondent is ordered to pay the applicant’s legal costs in respect of the section 18(3) application on attorney and client scale.

Source and reliance status

South Gauteng High Court, Johannesburg

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Judgment reading view

Judgment text

The complete available source text.

Source document

South Gauteng High Court, Johannesburg

Judgment

[2024] ZAGPJHC 207

IN THE HIGH COURT OF SOUTH AFRICA,

GAUTENG LOCAL DIVISION, JOHANNESBURG

Case No:39461/2020

1.REPORTABLE: YES / NO

2.OF INTEREST TO OTHER JUDGES: YES/NO

3.REVISED: NO

1 March 2024

In the matter between:

ENGEN PETROLEUM LIMITED Applicant

And

DAV DISTRIBUTION CC t/a WILLOWCREST CONVENIENCE CENTRE

(registration No.: 1995/020132/23) Respondent

In re:

ENGEN PETROLEUM

LIMITED Applicant

DAV DISTRIBUTION CC t/a WILLOWCREST

CONVENIENCE CENTRE Respondent

JUDGMENT

NOKO J

Introduction

[1] The respondent launched an application for leave to appeal the judgment and order I granted for the eviction of the applicant from the applicant’s immovable property, to wit, Erf 59, Cresta Ext 1 Township, situated at cnr Judges street and Republic Avenue, Cresta, Randburg. The applicant in turn launched an application in terms of section 18(3) of the Superior Court Practice Act (“the Act”) to execute the eviction order pending leave to appeal and/or appeal.

[2] The respondent has subsequent to receiving section 18(3) application decided to withdraw its application for leave to appeal and tendered costs. As a result of the withdrawal the application in terms of section 18(3) of the Act becomes superfluous. The respondent refused to make a tender for legal costs in respect of the section 18(3) application and the parties appeared before me to argue the question of costs.

[3] The respondent contends that the application in terms of section 18(3) is about the creation of rights and not necessarily to exercise the existing rights. In such an instance, so the respondent’s counsel continues, the applicant is therefore asking for an

indulgence or condonation and such an applicant must as a matter of course make a tender for costs. The counsel contended further that the argument she is advancing is novel and is therefore precedent setting. Further that it is akin to application to uplift the bar in terms of rule 27 where a party is seeking an indulgence from court. The respondent argued that it would justifiably be mulcted with an order for costs where the court held that the application was opposed vexatiously or frivolously.[1]

[4] The applicant in retort contended that section 18(3) application was triggered by the respondent’s application for leave to appeal. The applicant is now out of pocket and the respondent should be ordered to pay the legal costs associated with the application for section 18(3).[2] In addition, the withdrawal of the application for leave to appeal without any explanation being proffered is evidence of malice on the part of the respondent and a confirmation that the application for leave was without merits and only launched with the sole purpose of frustrating the applicant in executing the eviction order.

[5] The respondent’s counsel contended that the section 18 (3) application just like the application for leave to appeal brought by the applicant creates procedural rights which must be exercised by a party who satisfies the requirements set out in the relevant rules. If the respondent can satisfy the court that the requirements set out in 18(3) are met, then the respondent would therefore be entitled to be exercise those rights.

[6] I struggled to fathom the raison d’tre underpinning the contention that the provisions of section 18(3) of the Act do not provide for a procedural right[3] which a party would exercise if such a party satisfies the requirements. This applies to all other provisions of the rules which

makes provision for a party to approach court for a specific remedy.

[7] The respondent’s argument could not be substantiated with any authority or the argument advanced could not lay good basis for me to conclude that the time has come that procedural rights established by section 18(3) of the Act should be viewed differently to other rights created by the rules.

[8] The arguments by the respondent are unsustainable and bound to fail.

Costs

[9] The applicant contends that the legal costs in terms of the lease agreement between the parties should be on attorney and client scale. There are no reasons presented to unsettle the general principle that the costs should follow the results.

Order

[10] In the premises I grant the following order:

That respondent is ordered to pay the applicant’s legal costs in respect of section

18(3) application on attorneys and client scale.

Mokate Victor Noko

Judge of the High Court

This judgement was prepared and authored by Noko J is handed down electronically by circulation to the Parties / their legal representatives by email and by uploading it to the electronic file of this matter on CaseLines. The date of the judgment is deemed to be 1 March 2024.

Date of hearing: 15

February 2024

Written submissions

20 February 2024

Date of judgment:

1 March 2024

Appearances

For the Applicant: Adv

S Aucamp

Attorneys for the Applicant:

DM5 Incorporated Attorneys.

For the Respondent:

Adv JM Butler

Attorneys for the Respondent

Des and Naidoo Attorneys

[1] The parties were requested, and they submitted written submission to guide the court with relevant authorities and respondent referred to Mers v Abramson 1951 (3) SA 438 (C) which confirmed cost would be ordered where opposition was frivolous.

[2] Applicant referred to In re: Alluvial Create 1929 CPD 532 and Boost Sports v South African Breweries 2015 (5) SA 38 (SCA) to buttress the argument that a party who is out of pocket should be allowed to recoup the loss.

[3] The word right is being used loosely.

Source wording is retained. Consult the source document for its original formatting and pagination.

Authorities

Authorities used by the court

Cases, legislation, regulations, and constitutional provisions identified in the available record.

Mers v Abramson 1951 (3) SA 438 (C)

Case cited

In re: Alluvial Create 1929 CPD 532

Case cited

Boost Sports v South African Breweries 2015 (5) SA 38 (SCA)

Case cited

Superior Court Practice Act

Legislation

Legislation referenced in the available case record.

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