Roucomm Systems CC v Minister of National Treasury and Another (551/14) [2020] ZANWHC 28 (30 April 2020)

IN THE HIGH COURT OF SOUTH AFRICA

NORTH WEST DIVISION, MAHIKENG

CASE NO. 551/14

In the matter between:

ROUCOMM SYSTEMS CC Applicant

and

MINISTER OF NATIONAL TREASURY

1st Respondent

MEMBER OF THE EXECUTIVE COUNCIL FOR 2nd Respondent

THE NORTH WEST PROVINCIAL DEPARTMENT

OF TRANSPORT AND COMMUNITY SAFETY

OPPOSED MOTION

GURA J

DATE OF HEARING

: 11 OCTOBER 2019

DATE OF JUDGMENT

: 30 APRIL 2020

FOR THE APPLICANT : Adv. J.A KLOPPER

FOR THE 2ND RESPONDENT : Adv. F.J NALANE

JUDGMENT

GURA J.

Introduction.

[1] The is an application for leave to appeal against the whole judgment an order of this Court which was handed down on 18 July 2019. The application is opposed by the second respondent (“the respondent”).

Grounds for the current application.

[2] The applicant has raised the following grounds in support of its application:

2.1 In paragraph 13 of the judgment, the Honourable Court found that there is a potential that the Respondent may not be able to call all the witnesses which it would have called had the case been heard within a reasonable time after the tender was awarded to Tau. The Honourable Court erred in taking the mere potential that the Respondent may not be able to call all the witnesses which it would have called into account in its judgment, in the absence of any details submitted by the Respondent relating to the identity of such witnesses, the nature and extent of their testimony and the relevance of such evidence to the subject matter of the Applicant’s claim for damages.

2.2 The Honourable Court erred in finding in paragraph 17 of the judgment that the Applicant has no reasonable acceptable explanation why it delayed for four years.

2.3 The Honourable Court erred in finding in paragraph 17 of the judgment that the Applicant acted in absolute disregard of the rules and the provision of section 3 of Act 40 of 2002.

2.4 The Honourable Court erred in paragraph 17 of the judgment in holding that the Applicant’s

attorney was grossly negligent for which the Applicant cannot be excused. In this regard:

2.4.1 The Honourable Court was informed and directed to the Applicant’s notice, dated 19 November 2013, addressed to the Respondent’s attorneys of record at that time, giving notice of the Applicant’s attention to pursue a claim for damages against the Respondents prior to instituting action proceedings;

2.4.2 The Honorable Court was further informed that the application for condonation, was brought primarily, to err on

the side of caution and to avoid any further delay in pursuing the action, should the Honourable Court find that the aforementioned notice is not compliant with the provisions of section 3 of Act 40 of 2002;

2.4.3 That the Respondent (sic) in these circumstances and on the bona fide belief that there has been due compliance with the provisions of section 3 of the Act, proceeded with legal action.

2.5 The Honourable Court erred in dismissing the Applicant’s application for condonation with costs. With regard to the costs, it is common cause that the Respondent was at all relevant times and in particular at the hearing of the application on 8 March 2019 represented by one counsel only.

2.6 The Honourable Court erred in paragraph 19 of the judgment in holding that there are no reasonable prospects of success in the Applicant’s application.

Legal principles.

[3] Section 17 (1) of the Superior Courts Act[1] (“the Act”), regulates applications for leave to appeal. I quote the said provisions:

“Leave to appeal may only be given where the judge or judges concerned are of the opinion that:

(a) (i) the appeal would have a reasonable prospect of success; or

(ii) there is some other compelling reason why the appeal should be heard, including conflicting judgments on the matter under consideration.

(b) the decision sought on appeal does not fall within the ambit of section 16(2)(a); and

(c) where the decision sought to be appealed does not dispose of all the issues in the case, the appeal would lead to a just and prompt resolution of the real issues between the parties.”

[4] In Fourouclas and Another v Pretorius[2], Hughes J dealt with the test to be applied in line with the current spirit of section 17 (1) as follows:

“[3] The test which was applied previously in applications of this nature was whether there were reasonable prospects that another court may come to a different conclusion. See Commissioner of Inland Revenue v Tuck 1989 (4) SA 888 (T) at 8908. What emerges from Section 17 (1) is that the threshold to grant a party leave to appeal has been raised. It is now only granted in the circumstances set out and is deduced from the words ‘only’ used in the section. See The Mont Chevaux Trust v Tina Goosen & 18 Others 2014 JDR 2325 (LCC) at para [6], Bertelsmann J held as follows:

“It is clear that the threshold for granting leave to appeal against a judgment of a High Court has been raised in the new

Act. The former test whether leave to appeal should be granted was a reasonable prospect that the other court might come to a different

conclusion. See Van Heerden v Cronwright & Others 1985 (2) SA 342 (T) at 343H. The use of the word “would” in the new statute indicates a measure of certainty that another court will differ from the court whose judgment is sought to be appealed against.”

[5] It is therefore clear that post the coming into operation of section 17 of the Superior Courts Act, it is no longer business as usual for any applicant who approaches the court with an application for leave to appeal. The barometer has been upped. It therefore follows that reasons which may have surmounted the previous test “reasonable prospects of success” may not necessarily pass the current test “would have a reasonable prospect of success”. Currently, the applicant (for eave to appeal) has to do more to persuade the Judge to grant leave to appeal. The intention of the legislature is crystal clear in section 17 (1). I am saying this also mindful of what the court said in the Dexgroup[3] case:

“The need to obtain leave to appeal is a valuable tool in ensuring that scarce judicial resources are not spent on appeals that lack

merit._ _ _”

Submissions.

[6] In his heads of argument, counsel for the applicant attacked the finding of the Court under three main headings:

6.1 There is a potential that the respondent may not be able to call all witnesses which it would have called had this case been heard within a reasonable time after the tender was awarded to Tau (ad para 13 of my judgment).

6.2 Applicant’s lack of bona fides and failure to submit any reasonable acceptable explanation for the delay in bringing the application for condonation (ad para 17 of my judgment).

6.3 Prospects of success (ad para 18 of my judgment).

[7] In support of his argument that the respondent failed to submit any evidence to show that the delay in bringing this application would lead to its prejudice because witnesses may disappear, counsel for the applicant referred the Court to Madinda v Minister of Safety and Security[4], where the Court stated:

“… The approach to the existence of unreasonable prejudice (not simply any level of prejudice, an aspect which the judgment of the court a quo blurs) requires a common sense analysis of the facts, bearing in mind that whether the grounds of prejudice exist often lies peculiarly within the knowledge of the respondent. Although the onus is on an applicant to bring the application within the terms of the statute, a court should be slow to assume prejudice for which the respondent itself does not lay a basis.”

Analysis by Court.

[8] In paragraph 12 of the judgment of 18 July 2019, the Court stated that in dealing with prejudice, the respondent categorically stated that some of its witnesses in the civil action are no longer in its employment. To me that suffices to show that there is a likelihood of prejudice in that when the time for the trial in the action comes, the respondent may not be able to locate some or all of these witnesses

[9] For a proper understanding of the context in which the Court found that the applicant had failed to give a reasonable explanation for the delay in bringing the section 3 application; and the basis on which the court questioned his bona fides it is apposite to quote a few relevant paragraphs in my judgment:

The delay.

[14] The applicant instituted its action against the respondent on 5 May 2014. A special plea was served on the applicant on 4 November 2014 drawing its attention to the provisions of section 3 of the Act. The applicant waited for at least four years until it brought the application for condonation.

[15] On 4 September 2017 the applicant filed an amendment to its particulars of claim. It sought to introduce a new paragraph 8 with this heading:

“Compliance with the provisions of Act 40 of 2002.”

The proposed amendment reads:

“Plaintiff complied substantially with the provisions of Act 40 of 2002 by giving notice of its intention to institute legal proceedings against the defendants.”

[16] Notice of this proposed amendment was filed almost 34 months after the special plea was served on the applicant. There is no reasonable explanation for that delay. As it later turned out, the said notice in terms of section 3 was not mailed to the respondent in this case. Incidentally, the very same notice in terms of section 3 is dated 29 June 2017 (Annexure FA6), contrary to what the applicant states in the founding affidavit that the notice was issued on 29 June 2016.

[17] In brief, from the filing of the special plea on 4 November 2014, the applicant waited about four years until it brought the current application on 17 August 2018. There is no explanation from the applicant which covers the whole four years delay. I have serious reservations about the applicant’s bona fides in bringing this application. First, he sent a section 3 notice to a wrong institution. That very same section 3 notice was not accompanied by an application for condonation. As if that was not enough, the applicant brings this application after a long time. I am not convinced that the applicant has any reasonable acceptable explanation why it delayed for four years. Applicant seems to have adopted an attitude of indifference against the submission of a section 3 notice. This laxity and absolute disregard of the rules and section 3, is inexcusable. How could the section 3 notice be issued and dispatched to the national department of public works, when the applicant and the respondent had been negotiating with a view to settlement long before the section 3 was issued? If the alleged section 3 notice was sent as aforesaid, then the applicant’s attorney, by directing the notice to the national – instead of the provincial office of the department of public works was grossly negligent for which the applicant cannot be excused.

[10] The Court made a finding that section 3 is mandatory and that protracted negotiations between the parties towards a possible settlement is not a valid ground to disregard the provisions of section 3. In this application (for leave to appeal), the applicant does not attack this finding. In my view, the applicant has to show that the Court was wrong in making such a finding. This is the main hurdle against the applicant in the current application.

[11] With regard to prospects of success of the applicant in its civil action for damages against the respondent, the applicant (as plaintiff) will have to show or prove fault at the trial on the part of the respondent in alleged fraudulent activities which Hendricks J foundwere perpetrated by Tau. It is Tau and not the respondent who submitted fraudulent documentation in its tender bid. I reiterate, Hendricks J found no fraudulent conduct against the respondent.

Conclusion.

[12] The applicant has a duty to persuade this Court that if leave to appeal is granted, “the appeal would have a reasonable

prospect of success.”[5] Largely, the attack on the judgment of this Court is directed to factual findings. It is my view therefore that there are no reasonable prospects of success in this case.

Costs.

[13] In my judgment of 18 July 2019, the Court ordered the applicant to pay costs including costs consequent upon the appointment of two counsel. In paragraph 2.5 of this judgment, the applicant avers that the respondent was at all times represented by one counsel but not two. The applicant suggests therefore (by implication) that the Court order relating to costs is irregular.

[14] The applicant’s legal team is surely aware that one set of heads of argument was filed with the registrar on behalf of the respondent. On page 8 of the heads of argument dated 7 March 2019, it appears clearly that the respondent’s heads were prepared by two advocates: M. Sikhakhane SC and F.J. Nalane. The fact that only Advocate Nalane argued the case before me alone, not with his Senior, does not disentitle the respondent of an order of costs involving two counsel. The spadework was done by at least two legal minds.

Order.

[15] The application for leave to appeal is dismissed with costs.

_________________________

SAMKELO GURA

JUDGE OF THE HIGH COURT

ATTORNEYS

For the Applicant : LVP ATTORNEYS

C/o MAREE & MAREE ATTORNEYS

11 Agaat Avenue

Riviera Park

Mafikeng

2745

Tel: 018 381 7495

Ref: GJ MAREE/YW/AA5215

For the Respondent : WERKSMANS ATTORNEYS

C/o M E TLOU ATTORNEYS

43 Baden Powel & Visser Streets

Golf View

Ref: MR TLOU/M1252/CIV

[1] Act 10 of 2013.

[2] (10619/10) [2017] ZAGPPHC 843 (16 November 2017).

[3] Dexgroup (Pty) Ltd v Trustco Group International (Pty) Ltd & Others 2013 (6) SA 520 (SCA) at page 528.

[4] [2008] ZASCA 34; 2008 (4) SA 312 (SCA) at para 21.

[5] Sect 17 (1) (a) of the Act.