Standard Bank of SA Ltd v Stander and Others (1294/2016) [2024] ZANWHC 186 (11 July 2024)

IN THE HIGH COURT OF SOUTH AFRICA

NORTH WEST DIVISION, MAHIKENG

CASE NO: 1294/2016

Reportable: YES

/ NO

Circulate to Judges: YES

/ NO

Circulate to Magistrates:

YES / NO

Circulate to Regional Magistrates: YES / NO

In the matter between:

STANDARD BANK OF SA LTD

PLAINTIFF

AND

I STANDER

1ST DEFENDANT

E S STANDER

2ND DEFENDANT

J F OOSTHUIZEN

3RD DEFENDANT

W C J OOSTHUIZEN

4TH DEFENDANT

A P OOSTHUIZEN

5TH DEFENDANT

Heard: 10 MAY 2024

Delivered: This judgment is handed down electronically by circulation to the parties through their legal representatives’ email addresses.

The date for the hand-down is deemed to be 11 JULY 2024

ORDER

I make the following order:

1. The exception by the first and second defendant is dismissed.

2. The first and second defendants are ordered to pay the costs of the application on scale B.

JUDGMENT

DJAJE DJP

[1] The plaintiff instituted an action against all the defendants based on a written home loan agreement in terms of which monies were lent and advanced to the defendants. The home loan agreement was attached to the particulars of claim. In the particulars of claim the plaintiff alleges that in terms of the agreement entered into by the plaintiff and the defendants an amount of two million three hundred and fourteen thousand nine hundred and eight rand nineteen cents (R2 314 908.19) was advanced to the defendants. The home loan agreement would be for a period of two hundred and forty (240) months with the initial minimum monthly repayment of twenty-three thousand two hundred and fifty-three rand ninety-three cents (R23 253.93). The said monthly payment was due thirty (30) days after registration of the mortgage bond in favour of the plaintiff and thereafter on the same day each month thereafter. It is the plaintiff's case that the defendants have failed to repay the instalments as agreed and are in arrears.

[2] Only the first and second defendants raised an exception and for the sake of convenience they will be referred to as the excipients. The exception raised is that the particulars of claim lack averments which are necessary to sustain an action on the following grounds:

“1. Plaintiff’s cause of action against the first and second defendant is based upon an alleged written home loan agreement concluded between the plaintiff and the defendant.

2. Plaintiff attached an alleged copy of the written home loan agreement between the parties as Annexure “X” to the particulars of claim.

3. The copy of the written home loan between the parties is not signed by the first and second defendant.

4. In the premises the written agreement attached is not a signed written agreement between the plaintiff and the first and second defendant as alleged in the particulars of claim.

5. Therefore, the particulars of claim lacks the necessary averments to sustain a cause of action, based upon an alleged written home loan agreement, against the first and second defendant.”

[3] In the main the excipients argued that the agreement relied on by the plaintiff and attached to the particulars of claim was not signed by them but was only signed by the other defendants.

[4] It was argued that there is no basis why the unsigned agreement would be enforceable against the excipients when clearly, they did not sign the agreement and the facility letter. As a result, the excipients cannot be deemed to be parties to the agreement which they did not sign. The argument advanced for the excipients was that it was evident from the agreement that an acknowledgment was required by the lenders and therefore the other defendants did sign the agreement. This is based on what appears on the last page of the agreement as follows:

“Aanvaarding: Ek/Ons, die Lener/s, verstaan en aanvaar die bepalings en voorwardes wat in hierdie document vervat is”

which was then followed by a section of the agreement where the parties must sign.

[5] It was further submitted that the excipients cannot be expected to deliver a plea where the alleged cause of action is not pleaded in the particulars of claim.

[6] In contention the plaintiff argued that the cause of action has been established in that it has been pleaded in the particulars of claim that the agreement was concluded between the plaintiff and the excipients. Further that the argument of the agreement being unsigned does not sustain a conclusion that the agreement is not enforceable. The plaintiff submitted that in terms of Rule 18(6) of the Uniform Rules of Court a party who relies on a contract needs to state if it was a written contract or oral, where it was concluded and attach a copy thereof to the pleading. This is what the plaintiff in

this matter did. During argument it was highlighted that the agreement does not contain a clause that requires the agreement to be signed for it to be valid. It is the plaintiff’s case that the issue of the agreement not being signed by the excipients is a defence that should be raised at trial and not at this stage.

[7] An exception is defined as a pleading in which a party states his objection to the contents of a pleading of the opposite party on the grounds that the contents are vague and embarrassing or lack averments which are necessary to sustain the specific cause of action, or the specific defence relied upon. See: Herbstein and Van Winsen- The Civil Practice of the High Courts and the Supreme Court of Appeal of South Africa 5th Ed,2009 Chapter 22 at pg630.

[8] In Vermeulen v Goose Valley Investments (Pty) Ltd 2001(3) SA 986 (SCA) it was held that:

“It is trite law that an exception that a cause of action is not disclosed by a pleading cannot succeed unless it can be shown that ex facie the allegations made by the plaintiff and any other document upon which his cause of action may be based the claim is (not may be) bad in law.”

[9] The court in Colonial Industries Ltd v Provincial Insurance Co Ltd 1920 CPD 627 at 630 stated as follows in relation to exception that:

“Now the form of pleading known as an exception is a valuable part of our system of procedure if legitimately employed: its principal use is to raise and obtain a speedy and economical decision of questions of law which are apparent on the face of the pleadings: it also serves as a means of taking objection to pleadings which are not sufficiently detailed or otherwise lack lucidity and are thus embarrassing.”

[10] The onus rests on the excipient to show that the particulars of claim disclose no cause of action. See: Amalgamated Footwear & Leather Industries v Jordan & Co Ltd 1948 (2) SA 891 (C).

[11] The issue in this matter is whether the unsigned agreement relied upon by the plaintiff discloses no cause of action and renders the particulars of claim excipiable.

[12] If there is evidence that can be led to disclose a cause of action as alleged in the pleadings, then the exception should not succeed. A pleading is excipiable only if there is no possible evidence that can be led to disclose a cause of action. See: McKelvey v Cowan NO 1980(4) SA 525 (Z) at 526.

[13] In this matter the plaintiff’s claim is based on a contract with the excipients. During argument the excipients argued that the contract was intended to be signed and if not signed it does not disclose a cause of action. The Supreme Court of Appeal in Pillay and Another v Shaik and Others 2009(4) SA 74 at par 50 stated as follows:

[50] I do not agree with the court a quo's conclusion that there could be no binding contracts between the parties unless each was signed by or on behalf of the buyers and the sellers. In my opinion it is clear from Goldblatt v Freemantle, supra, and the authorities cited therein that, in the absence of a statute which prescribes writing signed by the parties or their authorised representatives as an essential requisite for the creation of a contractual obligation (something that does not apply here), an agreement between parties which satisfies all the other requirements for contractual validity will be held not to have given rise to contractual obligations only if there is a pre-existing contract between the parties which prescribes compliance with a formality or formalities before a binding contract can come into existence. That this is so is clear, for example, from C W Decker's annotation on Van Leeuwen's Roman Dutch Law 4.2 sec 1 (not sec 2 as Innes CJ says at 129) where he pointed out (Kotzé's translation, 2 ed, vol 2, p 12) that we no longer uphold the distinction drawn in Roman law between real, verbal, literal and consensual contracts because all contracts with us are made with consent. With regard to written contracts he referred to an observation by Samuel Strykius (Modern Pandect 2.14.7) as follows:

‘we must regard the written contracts as distinct, in so far as we should bear in mind that although the writing does not constitute the essentiality of the contract, which is contained in the mutual consent of the parties, they may nevertheless agree that their verbal agreement shall be of no effect until reduced to writing, in which case the agreement cannot before signature have any binding force, although there exists mutual consent; and it cannot be said that the writing served not in perfecting the transaction, but only as proof thereof, since here it is agreed that the consent should not operate without the writing, which must be observed as a legitimate condition.'

[14] The excipients did not argue that the agreement herein does contain a clause prescribing that the contract will be binding if signed by all the parties. After the loan agreement was concluded, there was a Mortgage bond registered where the excipients are mentioned with their identity numbers. It is clear what the intention of the parties was when entering into the loan agreement. There is also the facility letter which is addressed to the excipients as well.

[15] At this stage the Court is required to determine whether the particulars of claim and the agreement relied on, discloses a cause of action. The plaintiff referred to the judgment of Investec Bank Limited v Isinda 154(Pty) Ltd and Others (42079/2012)[2016] ZAGPJHC 257 (23 August 2016) where the Court in dealing with unsigned agreements stated as follows at paragraph 13:

“13. Defendants relied upon Meter Motors (Pty) Ltd v Cohen 1966 (2) SA 735 (T) for this argument and sought to distinguish the later judgment of the Supreme Court of Appeal in Pillay & Another v Shaik & Others 2009 (4) SA 74 (SCA). Pillay supra is, of course, both a later judgment and one of the Supreme Court of Appeal. I propose therefore to first have regard to Pillay supra in which case there was a dispute whether or not a standard-form agreement headed “Agreement for the Purchase of a Members Interest in a Close Corporation” was binding on the parties only when both parties had signed the document. Defendants argued that Pillay supra was distinguishable because the document in question did not provide that it would not be binding unless and until signed by both parties whereas defendants maintain that the loan agreement in the present matter can only be read to that effect. As I have indicated, I do not need to decide the correct reading of the loan agreement between the litigants in this matter. The principle clearly enunciated in Pillay supra is not dependant upon the facts.”

[16] I agree with matter of Investec that at this stage of exception the Court is not called upon to interpret the agreement between the parties. What is required is whether the pleadings as they stand disclose a cause of action. The issue of interpretation should be left of the Court during trial. Rule 18 (6) of the Uniform Rules of Court has been complied with as the agreement relied on by the plaintiff had been attached to the particulars of claim. The particulars of claim disclose a cause of action and the exception stands to be dismissed with costs.

Order

[17] Consequently, I make the following order:

J T DJAJE

DEPUTY JUDGE PRESIDENT OF THE HIGH COURT

NORTH WEST DIVISION, MAHIKENG

APPEARANCES

DATE OF HEARING: 10 MAY 2024 RESERVED DATE: 15 MAY 2024 DATE OF JUDGMENT: 11 JULY 2024 COUNSEL FOR THE EXCIPIENT: ADV D SMIT COUNSEL FOR THE RESPONDENT: ADV SEVENSTER