Nompozolo v Law Society of the Cape Good Hope and Another (1338/2016) [2016] ZAECGHC 35 (26 May 2016)

IN THE HIGH COURT OF SOUTH AFRICA

EASTERN CAPE DIVISION, GRAHAMSTOWN

CASE NO. 1338/2016

In the matter between:

LINDILE BRIAN NOMPOZOLO

Plaintiff

and

LAW SOCIETY OF THE CAPE OF GOOD HOPE

First Defendant

THE DIRECTOR OF THE LAW SOCIETY OF THE CAPE OF

GOOD HOPE

Second Defendant

JUDGMENT

Bloem J.

[1] This is an application for summary judgment for payment of the sum of R2 614 461.45. On 10 March 2016 the plaintiff issued summons for an order, inter alia, that the first, alternatively the second defendant, pay the above sum into his trust account. The plaintiff, within 4 days after the delivery of the defendants’ notice of intention to defend, delivered a notice of application for summary judgment, together with his verifying affidavit. In that notice he set the matter down for hearing on 19 May 2016, a day reserved for opposed applications. The defendants delivered their opposing affidavits before 12h00 on 17 May 2016. At the commencement of the hearing of the application for summary judgment I was informed that the parties had agreed that an order should be granted giving the defendants leave to defend the plaintiff’s action. However, the parties could not reach agreement on the costs occasioned by the application for summary judgment and a postponement of the action. They accordingly requested me to make an order in respect thereof.

[2] On 21 October 2010 the plaintiff was struck off the roll of attorneys by order of this court. The first defendant is the Law Society of the Cape of Good Hope and the second defendant is the first defendant’s director. In terms of paragraph 10 of the order striking the plaintiff off the roll (the order) the second defendant was appointed as curator to administer and control the plaintiff’s trust accounts. The plaintiff’s claim is that between 26 February 2010 and 15 March 2011 the first, alternatively second defendant, caused the above sum to be transferred from his trust account to another trust account. The plaintiff claims that he has no interest in or control over the latter trust account. He accordingly claims payment of the above sum into his trust account.

[3] The defendants deny that they do not have a bona fide defence to the plaintiff’s claim. They raised various defences. It is unnecessary to deal with those defences because the parties agreed that the defendants be granted leave to defend the action. In my view that agreement is an acknowledgment on the part of the plaintiff that the defendants appear to have a defence or defences which is or are bona fide and good in law.[1]

[4] The following factors need to be taken into account when considering the issue of costs. By letter dated 25 February 2016 the plaintiff complained to the defendants that the re-direction of funds from his trust account was a violation of the court order, was unlawful and prejudicial to him. He gave notice of his intention to issue summons from this court against them. He attached a draft set of the summons and particulars of claim which he intended issuing to his letter. By letter dated 14 March 2016 the defendants’ attorneys informed the plaintiff that the defendants denied being liable to him and that any action instituted against them would be defended. The plaintiff was furthermore informed that this court does not have jurisdiction to entertain his contemplated action, that, on the basis of the documents that he sent to the defendants, any claim that he may have had against them became prescribed and that the defendants would raise the issue of lis pendens because, according to the defendants, there is litigation pending between them and the plaintiff on the same cause of action.

[5] In the circumstances, when the plaintiff issued summons on 10 March 2016 he knew that the defendants would deny liability on the merits of his claim and would, in addition, raise special pleas of jurisdiction, prescription and lis pendens. The defendants’ promise to defend the plaintiff’s action became a reality on 14 April 2016 when they delivered their notice of intention to defend. The plaintiff must have realised at that stage, if not earlier, that if the defendants alleged in their answering affidavit that his claim had become prescribed, the court hearing the application for summary judgment would be unable to grant summary judgment in view of the fact that, on the plaintiff’s case, the first alternatively second defendant took the above sum from his trust account between 26 February 2010 and 15 March 2011. The plaintiff instituted action against the defendants only during March 2016, more than three years[2] after the first alternatively second defendant took money from his trust account. It appears that the defendants have a valid defence of prescription against the plaintiff’s claim.

[6] I should not be understood to have made a finding that the plaintiff’s claim against the defendants has in fact become prescribed. It is for the trial court to determine that issue after the hearing of evidence in that regard. I merely point out that the plaintiff must have realised from the time that he received the letter dated 14 March 2016 from the defendants’ attorneys that an application for summary judgment would not be successful. He nevertheless made such an application.

[7] Ms Watt, counsel for the defendants, relying on the provisions of rule 32 (9) (a) of the Uniform Rules of Court submitted that, because the plaintiff knew that the defendants relied on contentions which would entitle them to leave to defend, this court should order that the action be stayed until the plaintiff has paid the defendants’ costs of the application for summary judgment, such costs to be taxed as between attorney and client. Mr Jikwana, counsel for the plaintiff, submitted that those costs should be reserved, to be determined by the trial court, alternatively that they be costs in the cause.

[8] Ms Watt submitted that the defendants entertain a fear that, should those costs be reserved and should the plaintiff thereafter withdraw his action, even with a tender to pay the defendants’ costs of the action, the plaintiff is unlikely to pay those costs. That fear is based on the following. Since 2014 the plaintiff instituted at least six set of proceedings against the first defendant and in some instances the second defendant, those proceedings arising from broadly the same causes of action. In one action in the Western Cape Division of the High Court, after the first defendant delivered a notice in terms of rule 30 (2) pointing out the various irregularities in the plaintiff’s summons and particulars of claim, the plaintiff withdrew his action on 25 July 2015 and tendered the first defendants’ costs which have not been paid. On 27 May 2015 the plaintiff withdrew another action in this court after the second defendant’s attorneys had served a notice in terms of rule 23 (1) on him. The plaintiff tendered the second defendant’s costs. The second defendant’s bill of costs was thereafter taxed and, after demand for payment had been directed to the plaintiff, execution proceedings are underway. In my view the defendants’ fear is, in the circumstances of this case, a reasonable one.

[9] The letter dated 14 March 2016 from the defendants’ attorneys should have discouraged the plaintiff from applying for summary judgment.[3] There is a price to be paid for such irresponsible litigation. The price that the plaintiff must pay is that he must pay the defendants’ costs of the application for summary judgment before he prosecutes his claim any further. The fact that the plaintiff must first pay the costs of this application before he can prosecute his claim any further is sufficient, in the circumstances of this case. An order that the plaintiff pay the costs on the scale as between attorney and client, in addition to the above measure, is not warranted. Mr Jikwana’s submission, that the costs of the application for summary judgment be reserved or ordered to be costs in the cause, would not be appropriate in the circumstances of this case and can accordingly not be sustained.

[10] In the circumstances, it is ordered that:

1. by agreement, the defendants are granted leave to defend the action;

2. the plaintiff pay the defendants’ costs of the application for summary judgment, such costs to include the costs occasioned by the hearing on 19 May 2016;

3. the action is stayed until the plaintiff has paid the defendants’ costs referred to in paragraph 2 above.

________________________

G H BLOEM

Judge of the High Court

For the plaintiff:

Adv T M Jikwana, instructed by Mzwai Mqanto and Associates, East London and N N Dullabh and Co, Grahamstown.

For the defendants:

Adv K L Watt, instructed by Bisset Boemke McBlain, Cape Town and Neville Borman and Botha, Grahamstown.

Date heard:

19 May 2016

Date of delivery of the judgment: 26 May 2016

[1] Maharaj v Barclays National Bank Ltd 1976 (1) SA 418 (A) at 426B-C.

[2] In terms of section 11 (d) of the Prescription Act, 1969 (Act No. 68 of 1969) a claim becomes prescribed after three years from the date when it arose.

[3] South African Bureau of Standards v GGS/AU (Pty) Ltd 2003 (6) SA 588 (T) at 592J-593C.