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South Africa Judgment

South Gauteng High Court, Johannesburg

Gumede and Others v Maqubela (14201/16) [2016] ZAGPJHC 401 (24 June 2016)

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Source document

01

Holding and result

The court found that there was a material conflict between the proposal, which was made in the name of the company, and the lease agreement, which was signed by the Defendant personally. The lease agreement defined the tenant as the Defendant personally and omitted any reference to the company or supporting documents such as a resolution or suretyship. However, the Defendant provided evidence of the company's existence and argued that he acted as a director. The court held that this conflict could not be resolved without oral evidence and that the Defendant had raised a triable issue. Accordingly, summary judgment was refused and the Defendant was granted leave to defend.

Court disposition

Summary judgment refused; Defendant granted leave to defend.

Orders

  • The Defendant is granted leave to defend the Plaintiffs' action.
  • The costs of the application for summary judgment are reserved for determination by the trial court.

02

Material facts

Parties

Nyangeni Saul Gumede N.O.

Plaintiff Counsel: J G Dobie

Brigitte De Bruyn N.O.

Plaintiff Counsel: J G Dobie

Isak Smolly Petersen N.O.

Plaintiff Counsel: J G Dobie

Brian Hilton Azizollahoff N.O.

Plaintiff Counsel: J G Dobie

Sakhumzi Lungelo Maqubela

Defendant Counsel: T J Machaba

Amounts and remedies

  • Claimed Arrear Rental and Charges: ZAR 819,903.68

03

Procedural history

  1. Posture

    Summary Judgment Application / Application for Summary Judgment; Leave to Defend

04

Questions and positions

Legal issues

Party arguments

Applicant
The Plaintiffs argue that the Defendant personally signed the lease agreement and is liable for arrear rental and charges. They contend that the Defendant's assertion regarding representation by Bezuidenhout is irrelevant, as the Defendant signed the lease himself. They further submit that the use of 'trading as' in the summons and particulars of claim is consistent with the wording in the signed lease agreement.
Respondent
The Defendant contends that he did not conclude the lease agreement in his personal capacity but acted as a director of Safana Panel Beaters and Spray Painters (Pty) Ltd, a registered company. He provides a CIPC certificate showing the company's registration and directors. He refers to a proposal to reinstitute the lease in the company's name and maintains that any obligations under the lease should be attributed to the company, not to him personally.

05

Court’s reasoning

  1. 01

    Arend v Astra Furnishers (Pty) Ltd, 1974 (1) SA 298 (C) at 303H–304A

    If there is a genuine dispute of fact as to whether a defendant contracted in a personal or representative capacity, summary judgment should not be granted and the matter should proceed to trial.

06

Ratio, limits and disposition

Ratio decidendi

The court found that there was a material conflict between the proposal, which was made in the name of the company, and the lease agreement, which was signed by the Defendant personally. The lease agreement defined the tenant as the Defendant personally and omitted any reference to the company or supporting documents such as a resolution or suretyship. However, the Defendant provided evidence of the company's existence and argued that he acted as a director. The court held that this conflict could not be resolved without oral evidence and that the Defendant had raised a triable issue. Accordingly, summary judgment was refused and the Defendant was granted leave to defend.

Obiter and limits

  • The use of 'trading as' in the lease agreement and summons does not, in itself, constitute a bona fide defence.
  • The deletion of annexures relating to suretyship and resolution suggests an intention not to contract on behalf of the company.

Court disposition

Summary judgment refused; Defendant granted leave to defend.

  • The Defendant is granted leave to defend the Plaintiffs' action.
  • The costs of the application for summary judgment are reserved for determination by the trial court.

Source and reliance status

South Gauteng High Court, Johannesburg

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Judgment text

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Source document

South Gauteng High Court, Johannesburg

Judgment

[2016] ZAGPJHC 401

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

REPUBLIC

OF SOUTH AFRICA

GAUTENG LOCAL DIVISION

JOHANNESBURG

CASE NO: 14201/16

In the matter between:

GUMEDE: NYANGENI SAUL (ID NO: … ) N.O. in his capacity as Trustee of MERGENCE AFRICA PROPERTY INVESTMENT TRUST (IT 11263/2003) First Plaintiff DE BRUYN: BRIGITTE (ID NO: … ) N.O. in her capacity as Trustee of MERGENCE AFRICA PROPERTY INVESTMENT TRUST (IT 11263/2003) Second Plaintiff PETERSEN: ISAK SMOLLY (ID NO: … ) N.O. in his capacity as Trustee of MERGENCE AFRICA PROPERTY INVESTMENT TRUST (IT 11263/2003) Third Plaintiff AZIZOLLAHOFF: BRIAN HILTON (ID NO: … ) N.O. in his capacity as Trustee of MERGENCE AFRICA PROPERTY INVESTMENT

TRUST (IT 11263/2003) Fourth Plaintiff and MAQUBELA:

SAKHUMZI LUNGELO (ID NO: … ) Defendant

JUDGEMENT

CARSTENSEN AJ:

1. The Plaintiffs seek summary judgement in the amount of R819 903.68 together with interest and costs in respect of arrear monthly rental and charges which arise out of an agreement of lease concluded between, the Plaintiff states, the Plaintiff and Defendant.

2. The Defendant raises a number of defences, including:

2.1. That he never authorised Johannes Jurgens Bezuidenhout to represent him in concluding the lease. (This appears to be irrelevant as it is common cause that the Defendant signed the lease and was not represented by Bezuidenhout).

2.2. Secondly, the Plaintiff states that the Plaintiff seeks to mislead the court by using the words “trading as” in the summons and particulars of claim. (I do not believe that this constitutes a bona fide defence as the signed agreement of lease also used the words “trading as”).

3. However, the Defendant states Safana Panel Beaters and Spray Painters is not his alter ego, but is actually a legal persona and attaches the CIPC certificate indicating that there is a company registered in the name of Safana Panel Beaters and Spray Painters (Pty) Ltd with registration number 2011/136859/07 and which has three directors.

4. The Defendant states that on the 21st January 2015 he approached the Plaintiff to reopen the business which resulted in the Defendant signing a proposal to JHI in re reinstitution of the lease agreement between Safana Panel Beaters and Spray Painters (Pty) Ltd and JHI.

5. This proposal, which appears on page 70 of the papers, indeed states that it is a “re reinstitution” of a lease agreement

between “Safana Panel Beaters and Spray Painters (Pty) Ltd and JHI”. The document is also signed by the Defendant “as director”, and “duly authorised representative”, as set out in the preamble and where the Defendant signs he also signs for and “on behalf of” Safana Panel Beaters and Spray Painters (Pty) Ltd.

6. He also states, however, in paragraph 7 that he will be running Safana as a “sole proprietor”. Despite THE

CONTENTS OF paragraph 7, it is my view that the proposal is clearly made in the name of the company and to reinstate the lease in the name of the company.

7. The Defendant states that he “ … did not conclude the lease agreement in his personal capacity. I have at all times acted as a director in the company”. This is contradicted by the lease agreement which records the Defendant’s name, ID number trading as Safana Panel Beaters and Spray Painters without the designation “(Pty) Ltd”. In addition, in paragraph 3 the tenant is defined as the Defendant personally. It is also noted that annexure C, being the suretyship, annexure D being the resolution are all deleted indicating that there was no intention to conclude the lease agreement on behalf of the company.

8. Nevertheless, I must bear in mind that if it turns out that the Defendant did not conclude the lease agreement personally but in the name of the company, that would constitute a defence at the trial. Arend v Astra Furnishers (Pty) Ltd, 1974 (1) SA 298 (C) at 303 H to 304 A.

9. At present, I am faced with a conflict between the proposal and the lease agreement and I am of the view that evidence would be required to show why the proposal was made in the name of the company, but the lease agreement was purportedly signed by the Defendant personally.

10. In the premises, I am not inclined to grant summary judgement.

11. Consequently, I make the following order:

11.1. the Defendant is granted leave to defend the Plaintiffs’ action and the costs of the application for summary judgement are reserved for determination by the trial court.

_____

P

L CARSTENSEN

ACTING

JUDGE OF THE

HIGH

COURT

HEARD: ___ JUNE 2016

DELIVERED: 24 JUNE 2016

COUNSEL FOR PLAINTIFFS: J G DOBIE

INSTRUCTED BY: REAAN SWANEPOEL ATTORNEYS

COUNSEL FOR DEFENDANT: T J MACHABA

INSTRUCTED BY: JERRY NKELI & ASSOCIATES INC.

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Authorities

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

Arend v Astra Furnishers (Pty) Ltd, 1974 (1) SA 298 (C)

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