Land and Agricultural Development Bank of South Africa v Praia Rocha 122 Investments (Pty) Ltd and Another (658/2022) [2024] ZANCHC 122 (19 November 2024)

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

NORTHERN CAPE DIVISION, KIMBERLEY

Case No: 658/2022

Heard on: 08/11/2024

Delivered electronically: 19/11/2024

Reportable: YES / NO

Circulate to Judges: YES / NO

Circulate to Magistrates: YES / NO

Circulate to Regional Magistrates: YES / NO

In the matter between:

THE LAND AND AGRICULTURAL DEVELOPMENT BANK OF SOUTH AFRICA Applicant and PRAIA ROCHA 122 INVESTMENTS (PTY) LTD (Registration No: 2007/008499/07) First Respondent GLENN GILMOUR MURDOCH (Identity No: 7[…]) Second Respondent

REASONS FOR ORDER

MAMOSEBO ADJP

[1] On 8 November 2024 I granted the applicant an order in these terms:

1. This application is heard as an urgent application, as contemplated

in Rule 6(12) of the Uniform Rules of Court and condoned the non-compliance with the rules specifically pertaining to service,

filing and time periods.

2. The late filing of the applicant’s application for leave to

appeal was found to be an abuse of court process.

3. The operation of the judgment granted by this court on 26 May 2023,

is not suspended pending the application for leave to appeal;

4. The auction scheduled to be held on 8 November 2024 at 11:00 is to

proceed as scheduled.

5. The costs of this application be paid by the first and second respondents, (the respondents) jointly and severally, the one to pay, the other to be absolved, on a scale as between attorney and client, including costs of counsel.

The order was granted without reasons. What follows are my reasons.

[2] These are the parties:

2.1 The Land and Agricultural Development Bank of South Africa (the Land Bank), is established in terms of Act 15 of 2002, and a registered credit provider with registration number NCRCP 18 and with principal

place of business at Block D, 2 Eco Glades, Witch-hazel Road, Pretoria. It is here acting in its capacity as a cessionary.

2.2 The first respondent is Praia Rocha 122 Investments (Pty) Ltd (Praia Rocha) (Registration No. 2007/008499/07), a company registered in terms of the laws of South Africa with its registered address situated at 22 Peter Place, Lyme Park, Bryanston, Gauteng Province.

2.3 The second respondent is Glenn Gilmour Murdoch (Murdoch), married out of community of property with domicilium citandi et executandi at 8[…] L[…] Street, Willow Glen, Pretoria, Gauteng Province. He is cited in his personal capacity as surety and

co-principal debtor who bound himself on behalf of the first respondent.

2.4 Mr Gideon Jacobus Koegelenberg was formerly the third respondent in this application but was not a party in this urgent application. He may be referred to where necessary for context.

[3] On 26 May 2023 judgment was granted against the respondents, jointly and severally, for payment in the amount of R10,342,167.04 (Ten Million Three Hundred and Forty Two Thousand One Hundred and Sixty Seven Rand and Four Cents) together with compounded interest at a rate of 8.50% per annum, such interest to be calculated daily and capitalised monthly from 31 October 2021 to date of payment as well as costs on a scale as between attorney and client. The following immovable properties registered in the name of Praia Rocha were declared specially executable in favour of the applicant:

3.1 Premises 55 (a portion of Premises 1) of Vaalhartsnedersetting B Agricultural Holding, Barkly West District, Northern Cape Province, held by the first respondent under Deed of Transfer T726/2015;

3.2 Premises 56 (a portion of Premises 1) of Vaalhartsnedersetting B Agricultural Holding, Barkly West District, Northern Cape Province, held by the first respondent under Deed of Transfer T726/2015;

3.3 Remaining Extent of Premises 494 of Vaalhartsnedersetting B Agricultural Holding, Barkly West District, Northern Cape Province, held by the first respondent under Deed of Transfer T[…];

3.4 Premises 495 (a portion of Premises 1) of Vaalhartsnedersetting B Agricultural Holding, Barkly West District, Northern Cape Province, held by the first respondent under Deed of Transfer T[…].

The properties were to be sold by the applicant or its appointed agent in conjunction with the sheriff of court by public auction or private treaty.

[4] Koegelenberg had launched an application for leave to appeal which was heard on 22 April 2024. Praia Rocha and Murdoch were served with the application. They made the election to file a Notice to Abide the court’s decision. On 03 May 2024 this court dismissed Koegelenberg’s application for leave. Koegelenberg filed a notice of application for leave to appeal in terms of s 17(2)(b) of the Superior Courts Act to the President of the Supreme Court of Appeal (SCA), pertaining only to the order granted against him as surety. The application was heard on 23 July 2024 and was dismissed. Despite Praia Rocha and Murdoch having been served with the application to the SCA they did not participate in that process either. Koegelenberg’s application for leave is now pending before the Constitutional Court (ConCourt). Ms Van der Merwe submitted that Praia Rocha and Murdoch have only filed a Rule 30 (irregular step) notice at the ConCourt pertaining to Koegelenberg’s

application.

[5] Following this court’s order granted on 26 May 2023, the Land Bank scheduled an auction for 8 November 2024 at 11:00. The respondents only filed an application for leave to appeal on the evening of 7 November 2024, 17 months later. It is significant that the respondents had filed a Notice to Abide the court’s decision in the application for leave to appeal the judgment and order of 26 May 2023 by Koegelenberg. It is incomprehensible why the respondents would serve an application for leave to appeal on the Land Bank less than 24 hours before this application was to be heard when they had 17 months to do so.

[6] The question is whether the purpose of the application for leave to appeal of 7 November 2024 was meant to suspend the operation of the order of this court granted on 26 May 2023 thereby preventing the auction scheduled to take place on 8 November 2024?

[7] Evidently, in the application that served before me on 10 February 2023 whose judgment was delivered on 26 May 2023, only Koegelenberg filed an answering affidavit. Praia Rocha and Murdoch chose not to

file an answering affidavit but rather filed a notice under Rule 6 (5)(d)(iii) of the Uniform Rules of Court[1] on 13 July 2022. They only argued the following points:

7.1 Whether proper service of the notice in terms of s 129 of the National Credit Act 34 of 2005 (the NCA) was effected;

7.2 Whether the Land Bank properly adhered to the provisions of Rule 46(1) of the Uniform Rules of Court; and

7.3 Whether the Land Bank properly adhered to the provisions of Rule 41A of the Uniform Rules of Court.

The main judgment has adequately dealt with these issues as follows: Ad 7.1 pertaining to s 129 notice is dealt with at paras 19, 20, 21, 22, 23, 24 and 25. Ad para 7.2 in respect of Rule 46(1) paras 26, 27, 28, 29 and 30. Ad para 7.3 pertaining to Rule 41A notice, paras 31, 32, 33, 34 and 35. There is no reason to regurgitate same in these reasons.

[8] Unterhalter AJ, writing for the majority in the ConCourt, in Villa Crop Protection (Pty) Ltd v Bayer Intellectual Property GMBH[2] dealt with the aspect of the abuse of process and remarked:

‘[77] This binary position fails to appreciate the true juridical nature of the power enjoyed by the courts to prevent an abuse of process, of which the doctrine of unclean hands is a species. An abuse of process can occur in a variety of ways. The litigation may be frivolous or vexatious. A litigant may seek to use the legal process for an ulterior purpose or by recourse to conduct that subverts fundamental values of the rule of law. The behaviour of the litigant may be so tainted with turpitude that the court will not come to such a litigant's aid. The unclean hands doctrine references this latter

type of abuse. It is the abusive conduct of the litigant that, in a proper case, may warrant the exercise of the court's power to non-suit such a litigant. The court does so, even though the litigant claims a right that they would vindicate in the court proceedings. For this reason, the power is to be exercised with great caution. Put simply, the court enjoys the power to safeguard the integrity of its process. The court will only exercise this power upon a careful consideration of the prejudice that this may cause to the abusive litigant, and, in particular, the harm that may be occasioned to a litigant whose claim of right will not be decided by the court. But the court's power to prevent the abuse of its process is not determined by the right that the abusive litigant claims.’

See also PFC Properties (Pty) Ltd v Commissioner, South African Revenue Service and Others 2024 (1) SA 400 (SCA) para 28.

[9] The objective of the application for leave to appeal as evinced in para 8 of the application was to thwart the auction sale. This emanates from the fact that the respondents are tendering reasonable costs that the auctioneers would incur for the auction for the day. In that way, so the submission went, there would be no prejudice to the auctioneers and the Land Bank. Of significance, the respondents do not deal with the three points in law that they raised when the matter was argued on 10 February 2023 as per para 7 (above). The grounds raised in their application for leave to appeal attached to the Land Bank’s application marked “FA2” comprise new facts and opposition on the merits. The respondents have not made any payment since 2018. This, in itself, spells prejudice.

[10] For the respondents to further contend that the application for leave to appeal is launched now because they have engaged a new set of attorneys is also clutching at straws, considering the lapsed 17-month period since the granting of the order. The new attorneys, as argued by Ms van der Merwe, have been on record since at least 21 August 2024 when the ConCourt papers were filed. This fact, without more, cannot be used by the respondents to prejudice the applicant in substantiation for an appeal on new grounds.

[11] The respondents approached this court purportedly on an urgent basis two weeks before the hearing on 8 November 2024 in an effort to stop the auction, but the application was dismissed for self-devised urgency. The fact that when the main application was heard the respondents only raised technical arguments in the Rule 6(5)(d)(iii) notice and failed to file an answering affidavit renders this belated opposition devoid of any merit.

[12] Ms Katz, for the respondents, conceded that a period of 17 months has lapsed since the court declared the property executable but contends that the respondents are open to mediation in this regard. Counsel further urged this court to stay the order granted on 26 May 2023 until the ConCourt makes its decision. Ms Katz agreed that the respondents are not joined in that application and have only filed a Rule 30 notice challenging the purported irregular step taken by Koegelenberg. Ms Katz conceded that the respondents were inactive since May 2023 but tender costs of the application and the auction. Ms Katz further submitted that the respondents stand to suffer irreparable harm because of the asset value at stake.

[13] Section 18 of the Superior Courts act 10 0f 2013, under the head ‘suspension of decision pending appeal’, provides:

‘(1) Subject to subsections (2) and (3), and unless the court under exceptional circumstances orders otherwise, the operation and execution of a decision which is the subject of an application for leave to appeal or of an appeal, is suspended pending the decision of the application or appeal.

(2) Subject to subsection (3), unless the court under exceptional circumstances orders otherwise, the operation and execution of a decision that is an interlocutory order not having the effect of a final judgment, which is the subject of an application for leave to appeal or of an appeal, is not suspended pending the decision of the application or appeal.

(3) A court may only order otherwise as contemplated in subsection (1) or (2), if the party who applied to the court to order otherwise, in addition proves on a balance of probabilities that he or she will suffer irreparable harm if the court does not so order and that the other party will not suffer irreparable harm if the court so orders.’

[14] The illuminating remarks by Wallis JA in Knoop NO and Another v Gupta (Execution)[3] bear repeating:

‘[2] At common law, unless the court in the exercise of a discretion ordered otherwise, an application for leave to appeal and an appeal pursuant to leave being granted suspended the operation of the order. It was not open to the successful party to execute on, or otherwise act pursuant to, that order. This common-law rule and the power to grant an execution order are now expressly embodied in s 18(1), read with s 18(3), of the Superior Courts Act 10 of 2013 (the SC Act). The grant of leave to execute is constrained by the requirements that it may only be granted if there are exceptional circumstances; if the applicant will suffer irreparable harm if it is not granted; and if the grant will not cause the respondent to suffer irreparable harm. A further safeguard against the risk of harm being caused by an execution order is the automatic right to an urgent appeal given by s 18(4). Pending such an appeal, the statute expressly provides in s 18(4)(iv) that the operation of the suspension order is itself suspended. This case illustrates what can go awry when a court attempts to override that statutory provision.’

[15] In granting the order in favour of the applicant and supporting the execution of the order, I relied on the following:

1. The Land Bank was granted a money judgment and a declaration for specified immovable properties to be declared specially executable. This relief was sought after a judgment debt of R10,342,167.04 with compounded interest remained unpaid.

2. Seventeen (17) months have lapsed without any action by the respondents despite being aware of the order against them.

3. The respondents were legally represented by an experienced counsel when they made the choice not to file an answering affidavit but to base their case on limited issues as outlined in their notice filed in terms of Rule 6(5)(iii)(d).

4. In their application for leave to appeal, which was only filed the evening before this application was heard, they failed to deal with the three aspects that they then relied on but introduced new aspects which were not part of their opposition. They erroneously contend that because they have instructed a new firm of attorneys they are at liberty to argue the case afresh.

5. Despite having been served with the application for leave to appeal in the 26 May 2023 application and the SCA leave application, they filed a notice to abide the decision of this court and did nothing in respect of the SCA application.

6. To now seek that this court stay the execution of its order pending the ConCourt application is unfathomable because the respondents have not been joined as parties. Praia Rocha and Murdoch have only filed a Rule 30 notice of an alleged irregular step taken by Koegelenberg in his approach to the ConCourt. The pending matter in the ConCourt has no bearing on the execution of the court order.

7. Despite the late filing of the application for leave to appeal (17 months later), there is no condonation application filed with the papers.

8. Regard being had to the evidence and argument presented and the authorities referred to I was satisfied that the applicant has raised exceptional circumstances and would suffer irreparable harm if the application was not granted. I was accordingly persuaded that granting the order would not cause irreparable harm to the respondents.

NORTHERN CAPE DIVISION

For the Applicant:

Adv A Van der Merwe

Instructed by:

Leahy Attorneys Inc

c/o Van de Wall Inc.

For 1st & 2nd Respondents: Adv. A Katz

Instructed by:

Engelbrecht Attorneys

c/o Majiedt Swart Inc

[1] Rule 6(5)(d)(iii) stipulates: (d) Any person opposing the grant of an order sought in the notice of motion must — (iii) if such person intends to raise any question of law only, such person must deliver notice of intention to do so, within the time stated in the preceding sub-paragraph, setting forth such question.

[1] Rule 6(5)(d)(iii) stipulates:

(d) Any person opposing the grant of an order sought in the notice of motion must —

(iii) if such person intends to raise any question of law only, such person must deliver notice of intention to do so, within the time stated in the preceding sub-paragraph, setting forth such question.

[2] Villa Crop Protection (Pty) Ltd v Bayer Intellectual Property GMBH 2024 (1) SA 331 (CC) para 77

[3] Knoop NO and Another v Gupta (Execution) 2021 (3) SA 135 (SCA) para 2