Jazz Spirit 1060 CC v Diversified Properrties 2 (Pty) Ltd (831/2009) [2010] ZAECMHC 28 (21 October 2010)

IN THE HIGH COURT OF SOUTH AFRICA

(EASTERN CAPE - MTHATHA)

CASE NO: 831/2009

DATE HEARD: 19/10/10

DATE DELIVERED: 21/10/10

NOT REPORTABLE

In the matter between:

JAZZ SPIRIT 1060 CC ….............................................................................APPLICANT

and

DIVERSIFIED PROPERTIES 2 (PTY) LTD ….........................................RESPONDENT

The applicant applied to intervene in eviction proceedings between the respondent and a third party, and then to apply for the rescission of the eviction order. It claimed to have a lease with the respondent in respect of the premises that were the subject matter of the eviction order. The respondent denied that a lease was in existence and asserted that if the applicant occupied the premises in issue, it may have done so as a sub-lessee of the third party (and in the face of a provision that forbade sub-letting without the written consent of the respondent). The court held that on either version the applicant did not have a direct and substantial interest in the subject matter of the dispute between the respondent and the third party. It held further that the application was frivolous and that an attorney and client costs order was warranted. The application was dismissed with costs on the scale of attorney and client.

JUDGMENT

PLASKET J:

[1] The applicant – Jazz Spirit CC – has applied to intervene in proceedings between the respondent – Diversified Properties – and its erstwhile tenant, Chenaub Supermarket CC trading as New Didi Fashions, in which Diversified Properties applied for and was granted an order that Chenaub Supermarket and anyone occupying the premises concerned ‘by, through or under’ it be evicted from the premises. If the applicant succeeds in its application to intervene, it plans to apply for the rescission of this order.

[2] The principles applicable to an application such as this, made in terms of rule 12 of the uniform rules, were summarised as follows by White J in Minister of Local Government and Land Tenure and another v Sizwe Development and others: In re Sizwe Development v Flagstaff Municipality:1

‘The undermentioned principles apply to an application in terms of Rule 12, or the common law, for leave to intervene.

The applicant must satisfy the Court that:

he has a direct and substantial interest in the subject-matter of the litigation, which could be prejudiced by the judgment of the Court … .

the application is made seriously and is not frivolous, and that the allegations made by the applicant constitute a prima facie case or defence – it is not necessary for the applicant to satisfy the Court that he will succeed in his case or defence … .

A “direct and substantial interest” means “… an interest in the right which is the subject-matter of the litigation and … not merely a financial interest which is only an indirect interest in such litigation” … .

The fact that a judgment or final order has already been issued is not a bar to leave to intervene being granted … if the intervention is sought for some legitimate process which can be instituted subsequent to the issue of the judgement or final order … .’

[3] The deponent to the founding affidavit, one Xiao Ping Liu, is the sole member of Jazz Spirit CC. He says that he bought a business known as New Didi Fashions from Chenaub Supermarket and that he entered into an agreement with Diversified Properties to lease the premises where New Didi Fashions traded. Subsequently, Diversified Properties brought an application to evict Chenaub Supermarket from these premises.

[4] The deponent to the answering affidavit, one Sipho Majija, denies that any lease agreement was entered into between Jazz Spirit CC and Diversified Properties and states that no sub-lease or cession was permitted on the part of Chenaub Supermarket without the written consent of Diversified Properties, which consent had never been given.

[5] The issue to be decided is whether, in these circumstances, Jazz Spirit CC can be said to have a direct and substantial interest in the subject-matter of the litigation between Diversified Properties and Chenaub Supermarket.

[6] If, as Xiao Ping Liu asserts, a lease between Jazz Spirit CC and Diversified Properties entitles it to occupy the premises, its occupation cannot be said to be ‘by, through or under’ Chenaub Supermarket and the eviction order has no effect on it. It consequently, on its own version, has no direct and substantial interest in the litigation between Diversified Properties and Chenaub Supermarket.

[7] The version of Diversified Properties is that no such lease exists. No written lease was put up by Xiao Ping Liu. On the principles set out in Plascon-Evans Paints Ltd v Van Riebeeck Paints (Pty) Ltd,2 I should accept the version of Diversified Properties. In that event, the only basis upon which Jazz Spirit CC could have occupied the premises is as a sub-tenant of Chenaub Supermarket – and that in the face of the prohibition of sub-letting without the written consent of Diversified Properties.

[8] The authorities are clear in this regard. It was stated thus by Horwitz AJ in Henri Viljoen (Pty) Ltd v Awerbuch Brothers:3

‘Where, however, the lessor sues his lessee, any rights of a sub-lessee are not in any way in issue in the proceedings; the sub-lessee has no “legal” interest in the contract between the lessor and the lessee, although he may have a very substantial financial or commercial interest therein which may be prejudicially affected by the judgment.’

[9] In the result, on either the applicant’s or the respondent’s facts, Jazz Spirit CC has no direct and substantial interest in the subject-matter of the dispute between Diversified Properties and Chenaub Supermarket. The application must therefore fail.

[10] Diversified Properties seeks costs against Jazz Spirit CC on an attorney and client scale. The case for Jazz Spirit CC was so devoid of merit and brought in the face of clear authority to the effect that it had no direct and substantial interest in the subject matter of the dispute between Diversified Properties and Chenaub Supermarket that the inference is inescapable that the application was vexatious in the sense that it was brought for an ulterior purpose4 and ‘without sufficient ground, to serve solely as an annoyance’ to Diversified Properties.5 In these circumstances a costs order on the scale of attorney and client is justified.

[11] In the result, the application is dismissed with costs on an attorney and client scale.

___________________

C PLASKET

JUDGE OF THE HIGH COURT

APPEARANCES

For applicant: Mr D.C. Bothma, instructed by SPF Attorneys, Mthatha

For respondent: Mr A.C. Immerman of Hughes Chisholm & Airey Inc, Mthatha

1 1991 (1) SA 677 (Tk), 678H-679D. (References omitted.) See too Henri Viljoen (Pty) Ltd v Awerbuch Brothers 1953 (2) SA 151 (O), 167A-F; United Watch and Diamond Co (Pty) Ltd and others v Disa Hotels Ltd and another 1972 (4) SA 409 (C), 416B-C.

2[1984] ZASCA 51; 1984 (3) SA 623 (A), 634H-I.

3(Note 1), 167E-F. See too United Watch and Diamond Co (Pty) Ltd and others v Disa Hotels Ltd and another (note 1), 417A-D.

4Hudson v Hudson and another 1927 AD 259, 268.

5Fisheries Development Corporation of SA Ltd v Jorgensen and another; Fisheries Development Corporation of SA Ltd v AWJ Investments (Pty) Ltd and others 1979 (3) SA 1331 (W), 1339E-F.