Ingegryn 40 CC t/a Reconstrate v ABSA Bank Limited (NCT/16162/2014/49(1)(P)NCA) [2015] ZANCT 23 (27 May 2015)

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 NATIONAL CONSUMER TRIBUNAL

HELD IN CENTURION

Case number: NCT/16162/2014/149(1) (P) NCA

In the matter between:

INGEGRYN 40 CC t/a RECONSTRATE

APPLICANT

and

ABSA BANK LIMITED

RESPONDENT

Coram:

Prof. Joseph Maseko – Presiding Member

Ms. Hazel Devraj – Tribunal Member

Prof Tanya Woker – Tribunal Member

Date of 1st Hearing – 11 November 2014

Date of 2nd Hearing – 21 May 2015

JUDGMENT AND REASONS

THE APPLICANT

1. The Applicant in this matter is Ingregyn 40 CC trading as Reconstrate, a Close Corporation incorporated in South Africa with Registration

Number 2011/035919/23, with business address in Ontdekkers Park in the Gauteng Province (“the Applicant”).

2. In the application, the Applicant, in the person of Mr. Aubrey Larkins, also stated that it represented Mr. A.M. Larkins and Ms H.H. Larkins at the hearing of 11 November 2014 as well as that of 21 May 2015. The confusion about who the Applicant or Applicants are is further

amplified upon below.

THE RESPONDENT

3. The Respondent is ABSA Bank Limited (Registration 1986/004794/06) with principal place of business in Johannesburg (“the Respondent”).

4. The Respondent (ABSA) is also a registered credit provider with the National Credit Regulator with registration number NCRCP7 (hereinafter also referred to as “the Credit Provider”).

5. At the hearing of 11 November 2014, and 21st May 2015, the Respondent was represented by Adv. Penny Bosman instructed by Èdward

Nathan Sonnenbergs (Attorneys) of Sandton.

TYPE OF APPLICATION

6. This application was lodged in terms of section 149(1) of the National Credit Act, 34 of 2005 (hereinafter referred to as “the Act”). The aim of the application was for this Tribunal to consider issuing an interim order for urgent relief pending the hearing of the principal matter described in Part C of the application.

7. The urgent interim relief sought from the Tribunal (as described in Part C of this application), was said to be that of:

“Freezing of ABSA home loan account (.......) and all associated insurance –related transactions (by virtue of insurance agreement

[.......]); including all interest, fees and capital repayments payable and all alleged obligations of the applicant’s clients

with respect this loan; until the National Credit regulator has adequately addressed and resolved the complaints (or referred these

complaints per the applicant’s requests in terms of certain sections of the Act) as outlined in Annexure “C” of this application”.

8. The Applicant averred that, in the event that its application is not granted for the said interim order, serious irreparable damage might result in:

8.1 The Applicant’s clients (elderly pensioners) facing legal action and repossession due to default on the loan unless granted an opportunity to a fair trial to argue their disputes against the conduct of the Respondent; or

8.2 The purpose of the Act may be frustrated in the form of the Applicant’s clients experiencing an impotence of the Act in so far as applicable sections (per Schedule 3 of the Act) is concerned; and its ability to address wrongful / unlawful / fraudulent conduct of credit providers.[1]

9. The main matter referred to in the abovementioned aspects of the application, consists of a list of 8 bullet points which catalogue the events, commencing with a complaint lodged in July 2010 with the National Credit Regulator (NCR).[2] For reasons which will be apparent below, there is no need to delve into the details of these catalogued events.

BACKGROUND

10. With regard to the list of complaints that the Applicant seems to wish to have resolved before the Respondent can take any further steps, including those contained in the order sought; are as follows:

10.1 A complaint regarding a mortgage bond had been lodged with the NCR (Reference Number C25646) in July 2010. Bullet two, shows that the NCR cited that it had no jurisdiction to deal with the matter, in (an unspecified date of) August 2010, as a result of the loan agreement originating before the effective date of the Act.

10.2 A subsequent insurance related complaint was lodged with the Ombudsman for Short-Term Insurance in (another unspecified date in) September 2013. This complaint related to insurance premiums that were capitalised to the home loan account. This complaint was also lodged as a separate complaint with the NCR (Reference Number C000000148).

10.3 The Ombudsman for Short-Term Insurance had, according to Applicant, reached an outrageous decision and on appeal, the Applicant referred the matter to the Financial Advisory and Intermediary Services (FAIS) Ombudsman. The latter Ombudsman had acknowledged receipt on an unspecified date in December 2013. At the time of the application, to this Tribunal, the Applicant had not received any feedback or response from the FAIS Ombudsman.

10.4 The Insurance related matter was escalated to the Financial Services Board (FSB) in (another unspecified date) in March 2014. Up to the time of lodging this application, the FSB had not provided any feedback.

10.5 In an unspecified date in June 2014, the Applicant sent a request to the NCR to reconsider the mortgage bond extension matter (Reference

Number C25646), previously denied, in the light of Schedule 3 of the Act (which had only come to the attention and awareness of the Applicant recently). The NCR had turned down this request and ignored further correspondence thereon.

Relief sought

11. The relief sought by the Applicant in this application before the Tribunal spans:

11.1 the interim urgent relief already mentioned in paragraph 8 of this judgment;

11.2 The Tribunal ordering the NCR to:

11.2.1 Reopen and resolve Complaint Number C25464.

11.2.2 Refer the complaint to the National Prosecuting Authority.

11.2.3 Issue a notice of non-referral to the National Consumer Tribunal.

11.2.4 Resolve complaint C000000148.

11.2.5 The Tribunal ordering another (unspecified) regulatory body, such as the FSB to resolve the insurance related complaint.

12. The Applicant submitted that one of its motivations for the urgent interim relief to be granted, is that continued subsistence of the status quo would result in:

“The Applicant’s clients (elderly pensioners) facing legal action and repossession due to default on the loan unless granted an opportunity to a fair trial to argue their disputes against the conduct of the Respondent.”

13. At the hearing of 11 November 2014, this Tribunal indicated to the Applicant, that it had not been clear what the business of the

Applicant was and who these people the Applicant appeared to be representing were.

13.1 This above content lead to the question whether the Applicant is an applicant or a representative of the entities it calls clients. At this point, it then transpired that the Applicant was acting on the power of attorney issued by the two complainants Mr. A.M. Larkins and Ms H.H. Larkins. It was also pointed out to the Applicant that from the information unfolding it appeared that the current Applicant, as cited, is only a representative of the Larkins, and should not have cited itself as a party.

14. During the hearing of 11 November 2014 the Applicant only indicated that the interim order sought was apparently to prevent the suffering of old pensioners who are clients of the Applicant. It was at that point that an oral admission was made that the two Larkins were actually supposed to be the Applicants and not Reconstrate. To this end, the Applicant was advised, ex tempore, to amend its application accordingly before the matter could proceed any further.

PROCESS AGREEMENT BETWEEN THE PARTIES

16. After the Tribunal had demonstrated the challenges that were found in the case during the hearing of the 11th November 2014, the parties requested a brief conference between themselves to iron out the proposed way forward to cure the discrepancies in the status of the case. At the end of that conference, the parties submitted a written and duly signed inter partes agreement in which they agreed that:

16.1 They were to hold a “without prejudice” meeting to attempt and resolve the matter by no later than 11 December 2014;

16.2 Prior to holding the without prejudice meeting, the applicant would avail to the Respondent a full record of the documents and correspondence

in its possession in relation to the complaints referred to the NCR and FSB; under references:

16.2.1 NCR 25645;

16.2.2 NCR 000000148; and

16.2.3 FSB 504435.

16.3 Should the matter not be resolved by 30 January 2015, the Applicant would deliver an amendment to its application;

16.4 Within 15 days of receipt of the amended application, the Respondent would deliver an answering affidavit.

16.5 The parties would then approach the Tribunal to enrol the matter for hearing. The Tribunal granted the joint request for postponing the matter to be dealt with along the lines agreed between the parties.

DEVELOPMENTS IN THE HEARING OF 21 MAY 2015

17. After the matter was enrolled for hearing, it was set down for 21 May 2015. And at this session, it transpired, inter alia, that, from papers submitted by the Applicant, the matter between the real would-be Applicants, mentioned above, and the Respondent in this case, had already been decided in the (North) Gauteng Division of the High Court by summary judgment being granted. This was contained in a judgment of Case No.7338/2015 dated 23 March 2015.

18. The said Court Order ordered, in summary, payment of a certain sum by the would-be Applicants in this matter, payment of a certain sum in interest at a certain rate by an effective date; that the specified property be especially executable, and an award of costs against the two individuals cited in their own names as Respondents in the High Court case.

19. At this hearing of 21 May 2015, the Applicant sought to proceed with the matter as if the High Court decision did not come into existence. The Tribunal had to bring the existence of this order to the attention of both parties on the record. The Tribunal invited submissions from the parties in the light of the new developments. After a brief adjournment, to allow the Respondent to peruse the judgment, as they had clearly not been aware of it, the matter resumed.

20. At the resumption of the matter, the Respondent moved, ex tempore, that the application be dismissed, especially, in the light of the High Court decision as it concerned the same issues that were brought to the Tribunal albeit in the rather challenged fashion described above. Both parties confirmed that the facts canvassed in the High Court were the same that had been referred to this Tribunal.

21. The Respondent submitted that the representative of the Respondent who was before the Tribunal, was not aware of the High Court Order and their instructing client was as well not aware that other proceedings by a division of the Respondent had undertaken further legal processes whilst the case before the Tribunal was pending. It submitted that the High Court case had been handled by another firm of attorneys since ABSA Bank Limited deals with dozens of matters like these through the courts and employ the services of a panel of attorneys. However, a few telephone calls made during the adjournment, had yielded that the case before the Tribunal indeed dealt with the same issues, albeit for different relief sought, which had already been adjudicated by the Pretoria High Court.

22. In response to the above motion, the Applicant attempted to brush aside the issue and proceed with the merits of the case. The Tribunal

intervened to alert the Representative of the Applicant to the issue as to whether this matter should continue to be entertained in the Tribunal or not.

23. After hearing the parties further on this latest question arising, this Tribunal ruled, ex tempore and now confirms in this ruling, that this matter was now res iudicata and could no longer be entertained by this Tribunal.

24. The Tribunal takes note of the numerous issues raised by the Applicant in this matter and the seriousness of the allegations made. The Tribunal further takes note of the clear intention of the Applicant to assist and protect his parents in any manner he can. The decision as to whether the Tribunal can grant the application however falls squarely on a consideration of the powers granted to the Tribunal as set out in the Act.

THE LAW ON THE MATTER

25. Rule 3 (2) (a)[3] states that the Tribunal has the power to grant interim relief in any matter described in Rule 3(1)(c). Rule 3(1)(c) states that the Tribunal may deal with a matter originating as a complaint to the Regulator or arising from a complaint and referred to the Tribunal in terms of s. 137 (1), s. 140 or s. 141 (1) (b) of the Act;

26. Section 149 of the NCA states the following in respect of Interim relief -

(1) At any time, whether or not a hearing has commenced into a complaint, a complainant may apply to the Tribunal for an interim order in respect of that complaint, and the Tribunal may grant such an order if-

(a) there is evidence that the allegations may be true; and

(b) an interim order is reasonably necessary to-

(i)

prevent serious, irreparable damage to that person; or

(ii) prevent the purposes of this Act from being frustrated;

(c) the respondent has been given a reasonable opportunity to be heard, having regard to the urgency of the proceedings; and

(d) the balance of convenience favours the granting of the order.

(2) An interim order in terms of this section must not extend beyond the earlier of-

(a) the conclusion of a hearing into the complaint; or

(b) the date that is six months after the date of issue of the interim order.

(3) If an interim order has been granted, and a hearing into that matter has not been concluded within six months after the date of that order, the Tribunal, on good cause shown, may extend the interim order for a further period not exceeding six months.”

26. “Complainant” is defined in the Act[4] as a person who has filed a complaint in terms of section 136(1) namely a person who lodged a complaint with the National Credit Regulator in the prescribed manner and form.

26. It has been stated in numerous previous decisions by the Tribunal that it was the clear intention of the legislature that the applicant in an application for interim relief must have an existing complaint before the National Credit Regulator[5] to qualify as a Complainant. For the Tribunal to consider an application for an interim order there must be an anticipated hearing

on the main merits of the matter. The Tribunal cannot make an interim order in a vacuum, without any indication of a future hearing on the main merits. It is clear from the facts of the matter that the Applicant in this matter (or more specifically – Mr and Mrs Larkin) do not have an existing complaint with the NCR. The NCR refused to investigate the complaint lodged by the Applicant and the matter was not taken further by the NCR. There is no ongoing investigation which may result in a hearing before the Tribunal.

Res iudicata principle

27. It is also clear that there is Summary Judgment which was delivered prior to the hearing of the matter at the Tribunal. The Respondent

proceeded to submit that the matter was now res iudicata (exceptio rei iudicatae vel litis finitae) as the matter between the parties had been litigated to finality.

28. In the case of Zietsman v Electronic Media Network (771/2010) [2011] ZASCA 169 the following was stated regarding the doctrine of res judicata:

“ [10] … The underlying ratio of the doctrine of res judicata is that where a cause of action has been litigated to finality between the same parties on a previous occasion, a subsequent attempt by one party to proceed against the other party on the same cause of action should not be permitted. The constituent elements of this defence are: (a) an earlier judicial decision, (b) which is final and definitive of the merits of the matter; (c) involving the same parties; (d) where the cause of action in both cases is the same; and (e) the same relief is sought.1

[11] Where a defendant raises the defence that the same parties are bound by a previous judgment on the same issue, it has become commonplace to refer to this defence as one of ‘issue estoppel’. The essential requirements of issue estoppel are: (a) an earlier judicial decision; (b) which is final and definitive of the merits of the matter; (c) involving the same parties; and (d) which involves an issue of fact or law which was an essential element of the judgment on which reliance is placed.2

[14] In order for the defence of res judicata to be sustained it must be shown that the earlier judicial decision on which reliance is placed was a decision on the merits. It has been said that, ‘it is not the form of the order granted but the substantive question (did it decide on the merits or merely grant absolution?) that is decisive in our law and that what is required for the defence to succeed is a decision on the merits.’3 The respondents submit that the SCA judgment was one of absolution from the instance. As indicated above they submit further that the causes of action in both applications for security for costs are not the same.”

29. In the Tribunal’s view the matter before it has been decided upon by the High Court and the Tribunal cannot grant the application.

In any event the Applicant has not laid a basis for an order as required by the Act.

ORDER

30. It is then the ruling of this Tribunal that:

(a) The application for urgent interim relief is refused; and

(b) There is no order as to costs.

Thus done and handed down in Centurion this 27th Day of May 2015.

(Signed)

Prof. Joseph M. Maseko

PRESIDING MEMBER

With Prof. Tanya Woker (Tribunal Member) and Ms. Hazel Devraj (Tribunal Member) concurring.

[1] Page 3 of the Case file

[2] Page 25 of case file.

[3] GN 789 of 28 August 2007: Regulations for matters relating to the functions of the Tribunal and Rules for the conduct of matters before the National Consumer Tribunal, 2007 (Government Gazette No. 30225)

[4] Section 1 of the Act

[5] See - Sandra McKeen and First National Bank (a division of First Rand Bank Ltd) NCT/943/2010/149(1) (P); GG Provan v First Rand Bank Limited NCT/4280/2012/149(1)(P)

[5] See - Sandra McKeen and First National Bank (a division of First Rand Bank Ltd) NCT/943/2010/149(1) (P); GG Provan v First Rand Bank Limited

NCT/4280/2012/149(1)(P)