Mount Frere Builders and Furniture Suppliers (Pty) Ltd v Kot Plus (Pty) Ltd and Others (Reasons) (3361/2024) [2024] ZAECMHC 96 (20 December 2024)

IN THE HIGH COURT OF SOUTH AFRICA

EASTERN CAPE DIVISION: MTHATHA

Case no: 3361/2024

In the matter between:

MOUNT FRERE BUILDERS AND FURNITUR E SUPPLIERS (Pty) Ltd Applicant And KOT PLUS (Pty) Ltd 1st Respondent SIWUNDLAMDUZULWANA SISA 2nd Respondent DEPUTY SHERIFF, MT FRERE, ZARINA CHAN 3rd Respondent ZARINA CHAN AND ASSOCIATES 4th Respondent HASSAN MOTALA 5th Respondent

REASONS FOR JUDGEMENT

MHAMBI AJ

DISCLAIMER: These are the reasons for the order that was delivered electronically by email circulation to all the parties, the date and time of delivery of the order was 20 December 2024.

Introduction

1. In this application the applicant seeks, in the main, the restoration of possession of the assets, which were sized on the 2nd August 2024, by the 2nd and 5th respondents. A declaration of unlawfulness as regards the removal of the assets without, allegedly unlawful cause is being sought. The applicant based its cause of action on mandment van spolie alternatively, rei vindicatio.

2. The application is opposed by the 1st and the 5th respondents on the basis that the 1st Respondent obtained a final order on 30th July 2023 authorizing it to obtain goods from “MT FRERE BUILDERS OR WHEREVER SUCH GOODS MAY BE FOUND…” .

3. It is common cause that the 2nd respondent upon the instructions of the1st,3rd, and the 4th respondents confiscated and seized the property belonging to the applicant on 2 August 2023, the sheriff according to him was acting

at all material times on the basis of the court order.

PROCEEDINGS UNDER CASE NO: 3199/2024

4. In this matter the applicant is KOT PLUS PTY Ltd, the 1st respondent is ABID RANA, and the 2nd respondent is WOZANI HARDWARE. On 30 July 2024, the applicant obtained an order before this Court per my sister Madyibi AJ. The effect of that order is found at paragraph 2,1 thereof, which reads as follows:

2.1 “that the Applicant is authorized that itself, together with the sheriff of the court, a security company, the South African Police Services and a locksmith appointed by the Applicant, enter upon the premises of the Respondent to forthwith uplift the goods described in the annexures “LY4”, and, from the respondents premises situated at WOZANI HARDWARE, MAIN STREET TSOLO, ALICE HARDWARE, MAIN STREET ALICE, MADIBA HARD WARE, MAIN STREET CALA, MBK HARDWARE 1 MAIN STREET KRANSKOP, AND MT FRERE BUILDERS, MT FRERE.”

5. It is on the basis of this order that the applicant’s goods were attached and seized as alleged by the applicant. The respondent is described in the aforesaid order as “Mt Frere Builders,” whom is situated at Mt Frere

6. In these proceedings, the applicant has described itself as Mount Frere Builders and Furniture Suppliers Pty Ltd, with principal address at Erf 338, Main Street Mt Frere. Its director is Mr. Abbas Amir, an adult male person of Mt Frere. This is evidenced by the CK documents of the applicant attached to the founding papers to this application.

7. Notably, is that the order relied upon by the respondents in attaching the property does not make reference to the applicant as the respondent but mentions Mt Frere builders as the party where the goods to be attached are located, for whatever reason that’s not the concern of this Court. It is worthy for me to say the few on the use of the company name.

THE USE OF THE COMPANY NAME

8. The use of the company name is provided in the Companies Act as follows:

“32 Use of company name and registration number

(1) A company or external company must-

(a) provide its full registered name or registration number to any person on demand; and

(b) not misstate its name or registration number in a manner likely to mislead or deceive any person.

(2) If the Commission has issued to a company a registration certificate with an interim name, as contemplated in section 14 (2) (b), the company must use its interim name, until its name has been amended.

(3) A person must not-

(a) use the name or registration number of a company in a manner likely to convey an impression that the person is acting or communicating on behalf of that company, unless the company has authorized that person to do so; or

(b) use a form of name for any purpose if, in the circumstances, the use of that form of name is likely to convey a false impression that the name is the name of a company.

(4) Every company must have its name and registration number mentioned in legible characters in all notices and other official publications of the company, including such notices and publications in electronic format as contemplated in the Electronic Communications and Transactions Act, and in all bills of exchange, promissory notes, cheques and orders for money or goods and in all letters, delivery notes, invoices, receipts and letters of credit of the company.

(5) Contravention of subsection (1), (2), (3) or (4) is an offence.

(6) and 7... ..”

9. The authorities have said this about the improper use of the company name.

10.

In Kirsh Industries Ltd v Vosloo and Lindeque and Others[1] the court held:

‘On behalf of the plaintiff it is contended that no new party is sought to be substituted as defendant. Plaintiff draws attention to the fact that the particulars of claim, annexed to the combined summons and served therewith, make it abundantly clear that the persons sued by the plaintiff are those persons who were partners in the firm of Vosloo and Lindeque at the date of accrual of the plaintiff's cause of action. It is contended that this appears clearly from the particulars of claim and in particular from paras 3, 4 and 7 thereof. Paragraph 3 alleges that the defendant was at all material times, and in particular during May 1978, the auditor of Marine and Trade. Paragraph 4 refers to the fact that during May 1978 the plaintiff was negotiating an agreement for the purchase of shares in Marine and Trade and para 7 alleges that on 11 May 1978 the defendant made a report to the directors of Marine and Trade in relation to a profit forecast and goes on to quote the terms of the said profit forecast. Plaintiff's counsel has quoted the remarks of HENOCHSBERG J in Goldberg and Another v Di Meo 1960 (3) SA 136 (N) at 149H which, he contends, are applicable to the facts of this application. These remarks are:

‘It is clear, as I have already said, that the summons was addressed to the old firm and, in my view, appellants ought readily to have appreciated this fact. Although the summons was served at a place where the old firm was not, at the time, actually carrying on business that does not to my mind, in the circumstances, provide a reasonable basis for appellants to think that any claim was being made against them or the partnership of which they were the members, even though they were carrying on the business of the Capri Restaurant. They were not the firm described in the summons in that they were not the 'duly registered firm 793/58'. They were well aware that the conditions of the deed of sale by which they were eventually to become the owners of the business had not yet been fulfilled and that, in particular, the bond upon which the claim for provisional sentence was based had not, when the summons was served, been cancelled. It follows, therefore, that in my view there was nothing in the form of the summons itself or the manner of its service that could afford any ground for holding that appellants were misled into thinking that the claim was being made against them. A fortiori I think the position should have been obvious to their attorneys.’

Plaintiff's counsel has submitted that the amendment is designed to eliminate contention as to the identity of the partners being sued in the action in the event of a judgment being obtained against the partnership (see eg M Rauff (Pty) Ltd v Pietersburg Coal Agency 1974 (1) SA 811 (T)’

11. The court, in Embling and Another v Two Oceans Aquarium CCW[2], said the following:

The approach in the Sentrachem case and in the other cases cited by Eksteen JA is in line with the policy consideration that “[e]xtinctive prescription should not be a blunt instrument for the rigid enforcement of a time bar: it penalises inaction on the part of the creditor rather than his legal ineptitude or practical inability to present his claim” (see Loubser op cit 134 and 135).

In my view, the existence of a cause of action is as much a basic component of an action as the existence in law and in fact of a defendant. This being so, an application of the test formulated by Eksteen JA in the Sentrachem case leads me to the conclusion that, provided the defendant as described in the amended summons is clearly recognisable from the original summons, the amendment sought by the plaintiffs amounts to no more than the “clarification of a defective pleading” and not the introduction of a new legal entity as the defendant.

South African courts have repeatedly pointed out that, in considering whether the provisions of section 15(1) of the Prescription Act have been complied with, what must be considered is the substance of the process in question and not merely its form (see, for example, Neon and Cold Cathode Illuminations (Pty) Ltd v Ephron 1978 (1) SA 463 (A) at 470F–471C and the other cases cited in Loubser op cit 129–134 and in Saner op cit 3–51 – 3–55).

From an analysis of the substance of the original particulars of claim, it is clear that the entity which the plaintiffs intended to hold liable was the legal entity owning and/or controlling and/or administering the Two Oceans Aquarium, Dock Road, Waterfront, Cape Town. Thus, in paragraph 2.2.2 of the particulars of claim, it is pleaded that:

“The Defendant owned and/or controlled and/or administered the Two Oceans Aquarium in the Cape Town Waterfront … as a tourist venue and/or a public attraction, as a result of which the Defendant, acting as aforesaid, owed a duty of care … to the First Plaintiff and the Second Plaintiff in particular, and the public in general” to take certain specified actions.

In the defendant’s plea this allegation is admitted, in so far as the contents of this paragraph refer to the Trust.

In the original summons and particulars of claim, the defendant was cited as having its place of business at Dock Road, Waterfront, Cape Town. The summons was served on a “Manager of the Defendant business” at this address.

A notice of intention to defend was entered on behalf of the Trust, the address of the Trust being given as Dock Road, Waterfront, Cape Town. Mr Saner relied on these facts to support his argument that the original citation of the defendant as a close corporation was a mere misdescription or misnomer which could be corrected by the amendment sought.

Mr Goddard did not deny that the Trust knew at all relevant times that it was potentially liable for the loss flowing from the first

plaintiff’s fall at the Two Oceans Aquarium, and that the summons was actually intended for it and not for a non-existent close corporation. He nevertheless argued that the amendment now sought by the plaintiffs went much further than the correction of a misnomer, amounting to an attempt to substitute one legal entity for another

(non-existent) legal entity as defendant at a stage when any claim against the first entity had prescribed. In pursuing this line of argument Mr Goddard relied heavily on the cases of Friends of the Sick Association v Commercial Properties (Pty) Ltd and another 1996 (4) SA 154 (D), L & G Cantamessa (Pty) Ltd v Reef Plumbers, 1935 TPD 56 and Hip Hop Clothing Manufacturing CC v Wagener NO and another 1996 (4) SA 222 (C).

In Friends of the Sick Association v Commercial Properties (Pty) Ltd (supra), the plaintiff had, during the course of the trial, applied for an amendment of the summons and particulars of claim in order to substitute the correct description of the plaintiff (as an association not for gain incorporated under section 21 of the Companies Act 46 of 1926) for the description which appeared in the original combined summons. In the original combined summons, the plaintiff was described as a voluntary association, but the voluntary association in question had incorporated itself under section 21 of

the Companies Act (using the same name) many years before the date of issue of the original summons. Niles-Duner AJ refused the application to amend on the following grounds:

“I similarly take the view that this is not a case of a mere misnomer and that the effect of granting the amendment would be to introduce a new persona in law as the plaintiff. This, in itself, upon the authorities to which I have referred, is not a bar to the granting of the amendment sought by the plaintiff – subject to considerations of prejudice to the first defendant. The difficulty,

however, is that the substitution sought relates to the plaintiff, and the persona described in the summons does not exist and did not exist at the date of issue of the summons. This calls into question the validity of the proceedings before me … I accordingly take the view that the summons is a nullity and that I cannot by the process of substitution revive it to the date of its issue” (at 157E–158A, my emphasis).

Insofar as the Friends of the Sick Association case dealt with the purported substitution of the plaintiff and the application to amend was brought during the course of the trial, it is distinguishable on the facts from the case before me. It is also important to point out that the Friends of the Sick Association case was not concerned with the question of whether the original combined summons had sufficed to interrupt the running of prescription in terms of section 15(1) of the Prescription Act. In any event, on a close analysis of the reported facts of that case, I am inclined to disagree with the conclusion of the learned Judge that the amendment sought went further than a rectification of a misdescription of the plaintiff’.

13. In Holdenstedt Farming v Cederberg Organic Buchu Growers (Pty) Ltd[3] the court said the following:

Despite such knowledge, she without demur continued to receive notices and documentation, the ostensible purpose whereof was the bringing about of a substitution in her husband's stead of the entity she and her husband knew was in law liable for the amount owing to the respondent, namely the Holdenstedt Farming partnership. In the light of such knowledge it is not surprising at all that the notice of intention to amend did not elicit any response. In view of Mr Potgieter's admission that he represented the Holdenstedt Farming partnership no basis upon which the proposed amendment could have been opposed is apparent to me. As is apparent from the aforegoing, at least one of the two partners of the Holdenstedt Farming partnership, namely Mr Potgieter, received notice of the intention to amend the respondent's particulars of claim, but failed to respond thereto and furthermore received the amended particulars of claim in terms whereof the partnership was substituted as the defendant.

As improbable as it is that Mr Potgieter would have exposed the partnership to an obligation of R900 564, as well as the expenditure

and effort to plant 300 000 buchu plants without any knowledge on the part of his partner, is the possibility that he and his wife would have failed to inform their father-in-law and father respectively of the respondent's attempts to hold him personally liable for a partnership obligation and the subsequent steps taken to substitute the partnership for him as the defendant. What is conspicuous by its absence on a close reading of Mr Ringelmann's affidavit is any averment that he had not been kept informed of any of the many developments in case No 10846/2004. In my view the probabilities overwhelmingly favour the conclusion that Mr Potgieter and his wife would have advised Mr Ringelmann of the attempts on the part of the respondent to bring about an amendment of the particulars of claim. I accordingly incline to the view that, on a balance of probabilities, both partners of the Holdenstedt Farming partnership had notice of the intended amendment to substitute it as a defendant and failed to object thereto despite such knowledge. Because of such failure the partnership in terms of rule 28 is deemed to have consented to the amendment as embodied in the notice of intention to amend and accordingly the respondent was fully entitled to amend its particulars of claim in accordance therewith’.

14. The circumstances of this case are distinguishable from the one in HUV Cape Spice v Hotspice Sauce CC[4] Louw J held that:

“In my view the contentions on behalf of the respondent is based on fallacy. The description of a party to a suit does not immediately

determine the nature and identity of a party. The law reports are replete with instances where the incorrect description of a party was allowed, in absence of a prejudice to other party involved, to be changed to reflect the true state of affairs”.

In Leopont 461 CC and Another v Ringane and Others[5] the court quoted Four Tower investments (Pty) Ltd v Andre’s Motors 2005 (3) SA 39 (NPD):

‘In an action in a magistrates’ court which went on appeal to the High court, the plaintiff was cited in the summons as a company.

Shortly, before the hearing of the appeal, it was established that the plaintiff was in fact a close corporation. The plaintiff then asked for an amendment on appeal to change the citation of the plaintiff from that of a company, to a close corporation. The

defendant resisted the application for the amendment on the basis that since the plaintiff as cited was a non-existent entity, the summons was a nullity and that in any event, the service of the summons, not having been issued and served at the instance of the plaintiff as a close corporation, even if the summons were not a nullity, did not

interrupt prescription. On the evidence which showed that it was a close corporation which had acted throughout, and that the citation

was in fact nothing but a misdescription of the plaintiff, the amendment was allowed’.

15. In Consolidated Transport Rigging and Logistics (Pty) Ltd v Concord Cranes (Pty) Ltd[6], the court referred to judgment by Mlyambina J:

‘… [I]n Chambi and Others v Registrar General Cause 21 of 2020, High court Republic of Tanzania a called it a ‘doctrine of finger litigation’ also held that ‘an error as to a name is nothing when there is certainty as to the person’, (page 16, my emphasis). Mlyambi J in the same judgment went on to state that the ‘doctrine of finger litigation’ involves the

determination of the ‘missing names or the correction of names where either party is improperly named in the particulars of claim. The court is then required to consider in totality whether the document as a whole and in all the circumstances would conclude that the parties are in fact the particulars of claim. The court is then required to consider in totality whether the document as a whole and in all the circumstances would conclude that the parties are in fact the parties in the litigation’, (page 17). In the context of this case, the totality of the evidence regarding the identity of the plaintiff was not clouded by the lack of comprehension by the defendant which would have made it impossible to identify the plaintiff. In essence, the plaintiff was easily identifiable by the defendant and there is no concrete and justifiable reason that could have planted a seed of doubt regarding

the identity of the plaintiff’.

17.

The facts of this case are identical to TJ Jonck BK h/a Bothaville Vlismark v Du Plessis NO[7], where the close corporation conducted business under a name other than it’s registered name without giving any indication of its real name or of the fact that it was a close corporation. Such a conduct was found to be in contravention of s 23 (provisions relating to the use and publication of names), and s 63 (a) (failure to use abbreviation “BK” or “CC”) and sufficiently serious enough to constitute a contravention of s 65, abuse of corporate juristic personality of corporation, of the Act.

18.

Under these circumstances the corporate veil is lifted, and the close corporation members can on application be declared personally liable for the debts of the corporation or jointly and severally liable together with the corporation for its debts. It follows without saying that the error on the name of the justice entity whether that is intentional or otherwise does not bar or exonerate the entity from liability as long as it’s identity is clearly identifiable.

ASSESSMENT

19.

The 1st respondent relied on a court order to attach and have the assets of the applicant removed by the sheriff, the 2nd respondent. It appears ex facie the court order relied upon by the applicant that the party mentioned therein is” Mount Frere Builders” main street Mt Frere, the applicant alleged this is not its name, its name is:” Mt Frere Builders and Furniture Suppliers (Pty) Ltd. The CK documents of the applicant are attached in the papers.

20.

The 1st respondent advances it’s case by further relying on delivery notes attached in the papers, the delivery notes concerned reflects customer name as Muhameed, Mt Frere Builders, Main street Mt Frere, next to Engine garage. It appears that the goods were received by one Hoosen on 05 June 2024. The 1st respondents answering affidavit has been deposed by Hassan Motala, who described himself as the adult male person conducting the

business as corporate recoveries and fraud investigator.

21.

Even though the deponent to the answering affidavit does not allege that he sold or delivered the goods to the applicant or to Mt Frere Builders, but it is alleged, the transaction has occurred between Wozani Hardware and Mt Frere Builders. If in motion proceedings the affidavit constitutes both pleading and evidence as it was accepted in Minister of Land Affairs and Agriculture v D and F Wevell Trust[8], the evidence by the deponent to the answering affidavit constitutes hearsay evidence until it is confirmed by the relevant

person.

22.

The 1st Respondent has filed confirmatory affidavit deposed by Abid Rana, who alleged to be the owner of Wozani Hardware.

23. Abid Rana confirms that:

“3, I confirm that I have sold hardware goods that I bought from Kot Plus to MBK Hardware in Kranskop, Mount Frere Builders in Mount Frere, Madiba Hardware in Cala and Alice Hardware in Alice”.

This accords with the confirmatory affidavit deposed by Lin Yan, that affidavit confirm that Mount Frere Builders (aka Mount Frere Builders and Furniture Suppliers (Pty) Ltd) purchased goods from Abid Rana in excess of approximately R1300 000.00.

THE APPRAOCH TO APPLICATIONS

24. It appears from National Director of Public Prosecutions v Zuma[9], that generally applications are not designed to resolve factual disputes between the parties and are decided on common cause facts.

Probabilities and onus issues are not amenable to be determined in motion proceedings.

25.

In Nohako v Nkosi[10] the court had this to say:

“It is well established under the Plascon-Evans rule that where in motion proceedings dispute of facts arise on the affidavits, a final order can be granted only if the facts averred in the applicant’s affidavits, which have been admitted by the respondent, together with the facts alleged by the latter, justify such order. It may be different if the respondent’s version consists of bald, or uncreditworthy denials, raises fictitious

dispute of fact, is palpably implausible, far-fetched or so clearly untenable that the court is justified in rejecting them merely on the papers”.

26. In this matter there are no relevant irresoluble factual disputes which are real and genuine.

27. The 1st respondent clearly identifies the person with whom the transaction was entered with, there is identification of where goods that are subject to this application were delivered, there is no dispute on who negotiated where goods were about to be removed.

On these basis, the version of the respondents ought to succeed. The orders were granted as they were in the Court Order. The application should fail with costs.

28. Consequently, the following order was issued:

ORDER

1. The application is dismissed with costs on scale A of the amended uniform rules.

M. Mhambi

Judge of the High court of South Africa (Acting)

Appearances:

Mr Zilwa Counsel for the applicant

Instructed by: Seethal Attorneys

6 Berea Road

Niravic Chambers

Portshepstone

Mr. Maharaj Counsel for the respondents

Instructed by: Zerina Chan and Associates

202 Kaliden House

118 Problem Mkhize Road

Morningside

Durban

Date of judgment: 23 January 2025

[1] 1982(3) SA 479 (W) at p 483.

[2] [2000] 2 All SA 355 (C) at pp 362-63.

[3] 2008 (2) SA 177 (C) at paras 22-3.

[4] (WCC) unreported case no 22227/2010 of 10 May 2011 at para 12.

[5] (LP) unreported case no 3633/2021 of July 2021 at para 5.

[6] (GP) unreported case no 34646/20 of 12 December 2023 at para 16.

[7] 1998 (1) SA 971 (O).

[8] 2008 (2) SA 184 (SCA) at p 200D.

[9] [2009] ZASCA 1; 2009 (2) SA 277 (SCA) at para 26.

[10] (ECM) unreported case no 5257/2022 of 21 April 2023 at para 6.