Firstrand Bank Limited t/a Wesbank v Shakgapicle Trading and Project (Pty) Ltd and Others (1471/2022; 1188/2022) [2023] ZANWHC 101 (30 June 2023)

SAFLII Note: Certain personal/private details of parties or witnesses have been redacted from this document in compliance with the law and SAFLII Policy

IN THE HIGH COURT OF SOUTH AFRICA

NORTH WEST DIVISION – MAHIKENG

Case no: 1471 / 2022 & 1188/ 2022

REPORTABLE: YES/NO

OF INTEREST TO OTHER JUDGES: YES/NO

REVISED: YES/NO

In the matter between:

FIRSTRAND BANK LIMITED T/A WESBANK Applicant And SHAKGAPICLE TRADING AND PROJECT (PTY) LTD 1st Respondent (REG NUMBER: 201[…]) GAOARABE REBECCA LESUPI 2nd Respondent (ID NUMBER: 791[…]) MOJAKI JONNY LESUPI 3rd Respondent (ID NUMBER: 740[…])

Reserved: 04 MAY 2023

Delivered: This judgment is handed down electronically by circulation to the parties through their legal representatives’ email addresses. The date for the hand-down is deemed to be 30 JUNE 2023.

ORDER

In the result, the following order is made:

1. The termination of the agreement between the Applicant and the Respondents is confirmed.

2. The first Respondent and / or whomever may be in possession of the following vehicles:

2.1 the TOYOTA FORTUNER 3. OD-4D RAISED BODY, 2007 MODEL, with engine number 1KD[…] and with chassis number AHT[…]; and

2.2 The CHEVROLET UTILITY 1.4 A/C P/U S/C, 2014 MODEL, with engine number ADM[…] (collectively referred to as “the vehicles”) is hereby ordered and directed to deliver the vehicles to the Applicant.

3. In the event of the First Respondent and / or whosoever may in possession of the vehicles failing to comply with this Order as articulated in (3) above, the Sheriff or his deputy be and is hereby ordered and directed to forthwith take possession of the said vehicles and thereafter deliver same to the Applicant.

4. The Applicant is granted leave to approach this court on the same papers, supplemented in so far as may be necessary, for judgment in respect of any damages and further expenses incurred by the Applicant in the repossession of the assets, which amounts can only be determined once the assets have been repossessed and sold by the Applicant.

5. The Respondents are ordered to pay the Applicant’s costs, jointly and severally, the one paying and the other to be absolved.

JUDGMENT

MTHIMUNYE AJ

[1] This is an opposed application for Summary Judgement against the

Respondents arising out of instalment sale agreements entered by the Applicant and the Respondents. At the onset I must mention that this is an outcome of two cases (Case Number 1471/200 and 1188/2022) that were consolidated as they both related to the same parties but two different goods as it will become apparent in this judgement. In both matters, the Applicant seeks summary judgement against the Respondents. The Respondents raised the same defences, points in limine and made the same concessions in both cases.

[2] The Applicant, who is the Plaintiff in the main actions is a company

with limited liability duly incorporated in accordance with the laws of the Republic of South Africa, with registration number 192[…] and a registered credit provider in terms of the National Credit Act 34 of 2005, with registration number NCR[…]. The Applicant carries on business as a financial institution and have its principal place of business at 1 Enterprise Road, Fairlands, Johannesburg, where it trades under the name and style of Wesbank, a division of FirstRand Bank Limited.

[3] The First Respondent is a private company duly incorporated in accordance with the laws of the Republic of South Africa with registration number 201[…] and having its registered address and domicilium et executandi at 16 Enkeldoring Street, Doringkruin, Klerksdorp, 2571. The Second and Third Respondents are directors of the First Respondent and they both signed suretyship agreements for the debts in terms of which they bound themselves to be jointly and severally liable as sureties and co- principal debtors for all payments due by the First Respondent to the Applicant.

[4] The historical origin of this matter is that on 19 May 2020, the

parties entered into an Instalment Sale Agreement in terms of which the first respondent purchased a Toyota Fortuner 3. OD-4D Raised

Body, 2007 Model, with engine number 1KD[…] and with chassis number AHT[…] (Case 1188/2022). In terms of the agreement the Applicant would advance an amount of R170 960.40 to the First Respondent who in return would pay it back in monthly instalments of R2 849.34.

[5] On 09 June 2020 the parties entered into another Instalment Sale Agreement in terms of which the first respondent purchased a Chevrolet Utility 1.4 2014 Model vehicle with engine number DXN[…] and chassis number ADM[…] for an amount of R157 083.00, which was also to be funded by the Applicant and recoverable in monthly instalment payments of R2 618.05 by the Respondents (Case Number 1471/2022).

[6] When the Respondents defaulted, the Applicant cancelled the agreements and issued summons seeking orders for the confirmation of cancellation of the agreements; the return of the vehicles, damages resulting from the valuation of the vehicles and recalculation of finance costs, interests thereon and costs.

[7] In their pleas (which were filed only after the Applicant had issued

notices of Bar), the Respondents, save for denying most of the Applicant’s aversions, raised the same defences in both cases

viz. that they did not sign any of the agreements that the Applicant is relying on but only the Cost of Credit Schedule and therefore no contract exists between the parties; that the Applicant did not comply with section 129 of the National Credit Act 34 0f 2005 (“the NCA”) in respect of notices; that the matter falls within the monetary jurisdiction of the Magistrates Court and should not be before this court; and that the suretyships agreements they signed are not valid and binding.

[8] In response to the Respondent’s pleas, the Applicant brought

this application for summary judgment on the basis that the Respondents have raised no bona fide defence or triable issue in their pleas and the pleas are simply bare denials and contain no probable or alternative version to the court. The Applicant contends that the pleas were entered just for purposes of delaying the process.

[9] In summary judgement proceedings, it is not for the court to consider

or rule on the prospects of success of the defences raised by the Respondents but to consider if such defences are bona fide and raise an issue that can be referred to trial. To make this determination I must consider the defences raised by the Respondents.

Prior to doing so, it is apposite to explain the principles governing summary judgement proceedings.

[10] The legal principles governing summary judgement proceedings were dealt with in Maharaj v Barclays National Bank Ltd 1976 (1) SA 418 (A) 426, where the Appellate Division held:

“…One of the ways in which a defendant may successfully oppose a claim for summary judgement is by satisfying the court by affidavit that he has a bona fide defence to the claim. Where the defence is based upon facts, in the sense that material facts alleged by the plaintiff in its summons, or combined summons, are disputed or new facts are alleged constituting a defence, the Court does not attempt to decide these issues or to determine whether or not there is a balance of probabilities in favour of the one party or the other. All that the Court enquired into is: (a) whether the defendant has ‘fully’ disclosed the nature and grounds of its defence and the material facts upon which it is founded, and (b) whether on the facts so disclosed the defendant appears to have, as to either the whole or part of the claim, a defence which is both bona fide and good in law. If satisfied on these matters, the Court must refuse summary judgement wholly or in part, as the case may be. The word “fully”, as used in the context of the Rule (and its predecessors), has been the cause of some judicial controversy in the past. It connotes, in my view, that, while the defendant need not deal exhaustively with the facts and the evidence relied upon to substantiate them, he must at least disclose his defence and the material facts upon which it is based with sufficient particularity and completeness to enable the court to decide whether the affidavit discloses a bona fide defence.”

[11] See also Nedbank Limited v Maredi and Another (25205/2013) [2014] ZAGPPHC 58 (28 February 2014), where Makgoka J, as he then was, confirmed the above as follows:

“[3] Before I consider the contentions on behalf of the parties, I deem it pertinent to set out the jurisprudential framework within which an application for summary judgement should be considered, which is trite and established. In order to stave off summary judgment, the defendant has to disclose a bona fide defence, which means a defence set up bona fide or honestly, which if proved at the trial, would constitute a defence to the plaintiff’s claim (Bentley Maudesley & Co. Ltd v “Carburol” (Pty) Ltd and Another 1949 (4) SA 873 (C); Lombard v Van der Westhuizen 1953 (4) SA 84 (C). The defendant must satisfy the court that he has a bona fide defence to the plaintiff’s claim and the full nature and

grounds thereof.”

[12] In Joob Investments (Pty)Ltd v Stocks Mavundla Zek Joint Venture 2009 (5) SA 1 (SCA) the Supreme Court of Appeal said the following regarding the intention of the remedy provided by summary judgment proceedings:

“…In South Africa, the summary judgement procedure was not intended to ‘shut a defendant out from defending’, unless it was very clear indeed that he had no case in the action. It was intended to prevent sham defences from defeating the rights of parties by delay, and at the same time causing great loss to plaintiffs who were endeavouring to enforce their rights.”

[13] In their affidavits resisting summary judgement, the Respondents raised four points in limine. First that the books and accounts that the deponent to the founding affidavit claims to have access to are secondary evidence and that evidence therefore is hearsay. Secondly that the deponent has no authority to represent, launch and sign any documents on behalf of the Applicant. Thirdly that the First Respondent’s business was in distress in 2020 and the Applicant did not conduct any affordability study and thus rendered itself guilty of reckless lending in violation of the

National Credit Act and lastly that this court lacks jurisdiction to hear this matter as it falls within the monetary jurisdiction of the Magistrates Court.

[14] I will now deal with each of these individually. As I do so, I must state that Counsel for the Applicant referred this court to a judgment of this Division per Djaje DJP in ABSA Limited v Shakgapicle Trading and Projects (Pty) Ltd and Others (Case No M291/2022) on 21 April 2023. In this case, the same respondents were resisting default judgment against ABSA. Interestingly, the Respondents also raised the same defences that they are raising herein and these were all rejected for the reasons I articulate hereunder. I am guided herein, to an extent, by the judgement of Djaje DJP, in respect of which Counsel for the Respondent also, in argument, conceded to the correctness thereof.

[15] On the contention that the deponent to the Applicant’s founding affidavit has no knowledge of the acts and therefore the evidence she relies on is hearsay. Counsel for the applicant correctly referred to

Barclays National Bank Ltd v Love 1975 (2) SA 514 (D) where the court held:

“although it is not necessary for the deponent to state reasons in the affidavit for his assertion that the facts are within his own knowledge he should…at least give some indication of his office or capacity which would show an opportunity to have acquired personal knowledge of the facts to which he deposes.”

[16] The above cited principle was confirmed by the Constitutional Court in President of the RSA and Others v M&G Media Ltd 2012 (2) BCLR 181 (CC) at [29] where the court said:

“The principle articulated in Love is sound. It is about how knowledge, practically speaking, is acquired, and how a deponent lay the foundation for alleging personal knowledge of certain facts. It acknowledges that laying a foundation for personal knowledge of a fact cannot practically require a deponent to produce a paper trail of every knowledge-building action he or she has undertaken.”

[17] The Applicant is a juristic person and not a ‘person’ for purposes of deposing to an affidavit. In this regard it relied on the Legal Manager: Specialised Collections to be the person with ability

to verify the facts that are essential to the effectiveness of the affidavit. In the affidavit the deponent states that:

“1.1. I am the Legal Manager for the Specialised Collections Department of the Applicant, and I am duly authorised to depose to this affidavit on behalf of the Applicant and the facts herein are within my own knowledge.

1.2. In this regard I have obtained personal knowledge of the circumstances hereof in that I have perused all of the financials of the Applicant as well as the relevant instalment sale agreement and all documentation incidental thereto.

1.3. Specifically, I confirm that I have had sight of all the documentation pertaining hereto and of relevance and I therefore bear personal knowledge of all facts in respect hereof.

1.4. I have also had sight of the Applicant’s system noted and am therefore aware of the telephonic and written communication between

the parties.”

[18] It is quite clear that the deponent, as the Legal Manager: Specialised Collections has had access to the books and accounts relating to this matter and has perused same. Undoubtedly, this gave her insight into the matter and lays a foundation for personal knowledge. In accordance with the principle in the President of the RSA v MG Media case cited above, she has laid a foundational basis for her knowledge and cannot be required to produce paper trail of every knowledge-building action he or she has undertaken In the ABSA judgement, Djaje DJP, dealing with the same issue stated:

“The deponent in her position with the applicant is better placed to have the necessary knowledge relating to this matter. Her reliance on the records and documents and her ability to swear positively thereto is sufficient.”

The Respondents’ contention that the deponent is relying on hearsay evidence must, for this reason, be rejected.

[19] The Respondents further question the authority of the deponent to depose to the affidavit and to litigate on behalf of the Applicant. The Applicant has confirmed that she is duly authorised to do so and has attached to the Affidavit a certificate of authority signed by the Applicant’s CEO, authorising the deponent to act on behalf of the Applicant. This point therefore, must also fail.

[20] On the issue of jurisdiction, the Applicant contends, which contention was also conceded to by Counsel for the Respondents that this court enjoys concurrent jurisdiction on the matter. For purposes of completeness though, I must state that the agreement which is the basis of this dispute contains the following provision in respect of jurisdiction:

“You agree that the laws of the Republic of South Africa shall apply to this Agreement and that the Magistrates Court shall have jurisdiction over any proceedings that may arise from this Agreement unless the Seller chooses the High Court”.

On the basis hereof and the concession of the Respondent’s Counsel, this point in limine is also rejected.

[21] On the issue of reckless lending, the Applicant submitted, which submission was also conceded to by the Counsel for the Respondents that the National Credit Act is not applicable to this transaction. The provisions relating to reckless lending in the National Credit Act do not apply to juristic persons such as the First Respondent nor do they apply to natural persons who sign an agreement as surety for such juristic consumers, which is the case with the second and third respondents. This court must agree with the Applicant and this contention by the Respondents must also fail.

[22] I now turn to deal with the defences that the Respondents raised in their pleas. They pleaded that there was never any contract signed by them and that what the Plaintiff refers to as a contract is a Cost of Credit. The heading of the document in full reads ‘Cost of Credit Schedule Instalment Sale Agreement Outside the NCA’. The document further contains a clear watermark which reads “Agreement entered into by Mojaki Lesupi Account Number 853[…] 2020/06/09 11:57:49”. Further it remains clearly visible on the face of the agreement that the First Respondent, represented by the Second Respondent, affixed an electronic signature to the agreement on 9 June 2020 at 11:57:49.

[23] In terms of section 13 of the Electronic Communications and Transactions Act 25 of 2002 (“ECTA”, an electronic signature is valid and binding. This section reads:

“(1) Where a signature of a person is required by law and such law does not specify the type of signature, that requirement in relation to a data message is met only if an advanced electronic signature is used…

(2) Subject to subsection (1), an electronic signature is not without legal force and effect merely on the grounds that it is in electronic

form.

(3) Where an electronic signature is required by the parties to an electronic transaction and the parties have not agreed on the type of electronic signature to be used, that requirement is met in relation to a data message if-

(a) a method is used to identify the person and to indicate the person’s approval of the information communication; and;

(b) having regard to all the relevant circumstances at the time the method was sued, the method was as reliable as was appropriate for

the purposes for which the information was communicated.

(4) Where an advanced electronic signature has been used, such signature is regarded as being a valid electronic signature and to have been applied properly, unless the contrary is proved.

(5) Where an electronic signature is not required by the parties to an electronic transaction, an expression of intent or other statement is not without legal force and effect merely on the grounds that-

(a) it is in the form of a data message: or

(b) it is not evidenced by an electronic signature but is evidenced by other means from which such person’s intent or other statement can be inferred.”

The respondent’s contention that they never signed any contract cannot be a bona fide defence in the face of the evidence that is before this court.

[24] The Respondents further pleaded that the Applicant did not comply with Section 129 of the NCA in so far as the notice is concerned. Despite the NCA not being applicable to this agreement, the Applicant has attached to its papers track and trace receipts which clearly record that section 129 notices were sent via registered post on 18

May 2022 (Case 1471/2022) and 13 April 2022 (Case 1188/2022) as per the Post office stamps thereon. It was established in Roussouw and Another v First Rand Bank Ltd 2010 6 SA 439 (SCA) at para 21-27 that the requirement of delivery of the notice is met when the notice was sent by registered post to the address chosen by the consumer, irrespective of whether or not the notice was actually received by the consumer.

[25] The Applicant further dispatched the section 29 Notices via tracked registered emails which clearly depicts that the notices were sent on 2 September 2020 at 11:00am, delivered on the same day at 11:22 and read by the Respondents at 11:27. This flies in the face of the honesty of the defences raised by the Respondents in their plea.

[26] On the argument that the surety agreements are invalid and not legally binding, the Applicant attached suretyship agreements clearly stating that the second and third respondent bound themselves as surety and co-principal debtors for all monies due to the Applicant. The relevant provision provides:

“1/We, the undersigned, hereby declare that I/We bind ourselves jointly and severally, as surety and as co-principal debtor for the punctual payment of all sums due or to become due to FirstRand Bank Limited (the Bank), by SHAKGAPICLE TRADING AND PROJECTS (PTY) LTD…”

The Respondent’s did not bother to even substantiate this argument. Be that as it may, evidence before this court suffices for the court to reject this argument as well. Consequently, I have found none of the defences raised by the Respondents to be bona fide, good in law or raising any issue that can be referred to trial.

Order

[27] In the result, the following order is made:

2.2 The CHEVROLET UTILITY 1.4 A/C P/U S/C, 2014 MODEL, with engine number ADM[…] (collectively referred to as “the vehicles”) is hereby ordered and directed to deliver the vehicles to the Applicant.

D P MTHIMUNYE

ACTING JUDGE OF THE HIGH COURT

OF SOUTH AFRICA NORTH WEST

DIVISION, MAHIKENG

On behalf of Applicant: Mr P J Oelofse Van Velden-Duffy Inc C/O CJP Oelefse Attorneys On behalf of Respondent Ms Zwiegelaar Briefed by: Theron Jordaan & Smit Inc Attorneys C/O Van Rooyen Tlhapi Wessels Attorneys

DATE OF HEARING: 04 MAY 2023

DATE OF JUDGMENT: 30 JUNE 2023