Standard Bank of South Africa (Limited) v Coetzee (8594/2020) [2021] ZAWCHC 281 (12 April 2021)

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

(WESTERN CAPE DIVISION, CAPE TOWN)

Case no: 8594/2020

In the matter between:

THE STANDARD BANK OF SOUTH AFRICA LIMITED Plaintiff

and

MARLENE COETZEE

Defendant

JUDGMENT: DELIVERED 12 APRIL 2021

NEL AJ:

1. This is an opposed application for summary judgment wherein the plaintiff seeks judgment in the sum of R 1 838 052.27, together with interest thereon, pursuant to a mortgage loan agreement, secured by a mortgage bond over the defendant’s immovable property. The plaintiff also seeks an order declaring the immovable property specially executable.

2. The defendant does not dispute the conclusion of the agreement, the registration of the mortgage bond, and that she fell into arrears with her monthly payment obligations.

3. In the affidavit filed on behalf of the defendant, opposing the summary judgment application, she raises two defences:

3.1 Firstly, she denies the amount of the arrears, claiming that legal costs which were not taxed or agreed had been added on to her account without her knowledge and/or consent;

3.2 Secondly, she alleges that the plaintiff failed to comply with the provisions of section 129 of the National Credit Act 34 of 2005 (“the NCA”).

4. For reasons which shall become apparent below, I shall first deal with the second defence.

5. The defendant alleges that in mid 2019, prior to the issuance of summons, a Mr. Bernard Gutman (“Gutman”), being a duly authorized agent, advised the plaintiff in writing of a change to the defendant’s chosen domicilium address. In support thereof the defendant attaches as annexure “MC3” to her opposing affidavit an email dated 15 July 2019, and addressed by Gutman to Mr. Andrion Gouws (“Gouws”), being the deponent to the affidavit filed by the plaintiff in support of the summary judgment application. In such email Gutman states as follows:

Marlene formally notifies you that her domicile under the agreements and address to be reflected on statements is now 2[...] S[...] Road, Saldanha Bay. Please amend your records accordingly.

6. The plaintiff addressed the section 129 notices, dated 19 March 2020, to the defendant at her former domicilium address of [...] C[...] Street, Ruyterwacht, as well as at the address of the mortgaged property, being [...] P[...] Street, Saldanha. The plaintiff concedes in its heads of argument that it had not sent the section 129 notice to the defendant at her current chosen domicilium address and therefore seeks an order postponing the application for summary judgment sine die in accordance with section 130(4)(b) of the NCA and for further directions for compliance with the provisions of section 129 read

with section 130.

7. Counsel for the defendant, Ms. Wharton, on the other hand contends that such relief is impermissible in accordance with the provisions Rule 32(4) in that the plaintiff is precluded in terms of that Rule from adducing further evidence other than the affidavit filed in support of the summary judgment application as envisaged in Rule 32(2).

8. The defendant moreover places reliance upon the matter of Rossouw v Firstrand Bank Ltd 2010 (6) SA 439 (SCA) which reiterated the provisions of Rule 32(4). The matter concerned an appeal to the Supreme Court of Appeal against summary judgment granted by the Pretoria High Court against the appellants, in favour of the respondent (the bank), based on a loan agreement and mortgage bond. The appellants raised non-compliance with the provisions of section 129 of the NCA as a defence to the plaintiff’s claim in the summary judgment proceedings. The bank had failed to state the method employed in delivering the section 129 notice to the appellants. Therefore, at the hearing of the summary judgment application the bank’s legal representative handed up proof that the notice had been sent via registered mail. The Supreme Court of Appeal found that such document was inadmissible as it contravened the provisions of Rule 32(4).

9. Counsel for the plaintiff, Mr. Jonker, on the other hand referred the Court to an unreported full bench appeal in this division of Navindran Pillay & Another v Standard Bank of South Africa Limited (appeal case no: A131/2015) where the court had to consider whether it was appropriate for an application for summary judgment to be postponed sine die in terms of section 130(4)(b) for the credit provider to comply with the NCA. The court a quo granted summary judgment, although the plaintiff failed to terminate the debt review in terms of section 86(10) prior to the institution

of action. The defendant appealed the judgment. At the hearing of the appeal, the bank conceded that it had failed to comply with the provisions of the NCA prior to the institution of action. The bank proposed that in upholding the appeal, the court should not dismiss the application for summary judgment, but instead replace the court a quo’s order with an order postponing the application for summary judgment sine die for compliance as envisaged by section 130(4)(b). Dolamo J (Gamble J and Samela J concurring) held as follows at para [29] and [30]:

[29] The respondent’s proposal that the Court should not set aside the summary judgment but employ the provisions of section 130(4)(b)(i) and (ii) to adjourn the matter and make an appropriate order setting out the steps it must complete before the matter may be resumed is the correct approach. Where there has been non-compliance with the requirements of sections 127, 129 or 130, the Court is obliged to adjourn the matter before it, in terms of section 130(4)(b)(i). This appears from the word “the Court must” used in that subsection. The Court, however, has a discretion regarding the appropriate order that it may make in order to facilitate compliance with the requirements of the NCA before the matter may be resumed. In Investec Bank Ltd t/a Investec Private Bank v Ramurunzi the SCA, following the interpretation placed by the Constitutional Court, held that:

“[23] Section 130(4) is unusual, for it requires a court to pause (adjourn) the proceedings so that the service provider gives the consumer the benefit of notice as to his or her options – a notice that should ordinarily be given before summons is issued and served. It is the consumer who might be prejudiced were he or she not to be given those options. Thus the proceedings have a life, as Cameron J has said, and are not void, despite the absence of a s 129 notice. The very fact that a court must make an order as to how the proceedings are to be continued indicates the validity of the summons rather than its nullity.”

[31] I accordingly deem it appropriate to adjourn the application for summary judgment and craft an appropriate order for the further conduct of the matter.

10. It must be assumed that three senior judges of this division were well aware of the trite provisions of Rule 32(4) when handing down this judgment.

11. Plaintiff’s counsel also referred to the matter of Standard Bank of South Africa Limited v Rockhill & Another 2010 (5) SA 252 (GSJ) where the South Gauteng High Court had to consider the further conduct of summary judgment proceedings, having concluded that the plaintiff failed to comply with section 129(1) of the NCA. In para [17] to [19] Epstein AJ held as follows:

[17] In summary judgment proceedings, a defendant who does not give security to the plaintiff must satisfy the court by affidavit that he has a bona fide defence to the action. In resisting the plaintiff's claim the defendant's contentions must be advanced with a sufficient degree of clarity to enable the court to ascertain whether he or she has deposed to a defence which, if proved at the trial, would constitute a good defence to the action. Whilst non-compliance with s 129(1)(a) is an impediment to commencing any legal proceedings to enforce a credit agreement, it does not constitute a bona fide defence of the nature envisaged by rule 32(3)(b). Once it is established at trial stage that the plaintiff has not complied with s 129(1)(a), the trial will be adjourned and an order made setting out the steps the plaintiff must complete before the trial is resumed. The fact that s 130(4)(b) envisages the resumption of the proceedings following the court having made an appropriate order, illustrates that non-compliance with s 129(1)(a) does not constitute a bona fide defence for summary judgment purposes.

[18] In the circumstances, I must respectfully disagree with the finding in Standard Bank of South Africa Ltd v Van Vuuren, namely that a defendant who establishes non-compliance with s 129 of the NCA has established a defence and is entitled to leave to defend. The court's hands are tied and it must act in accordance with s 130(4)(b).

[19] Accordingly, this matter will be adjourned sine die and an order will be made as to the steps which the plaintiff must take before it may again set down this application for summary judgment.

12. Epstein AJ proceeded to postpone the application for summary judgment sine die, with further directions for the plaintiff to send the section 129 notice to the defendant.

13. Furthermore, in Land & Agricultural Development Bank of South Africa v Chidawaya & Another 2016 (2) SA 115 (GP), the Gauteng Division was dealing with summary judgment proceedings and had to consider whether the plaintiff complied with section 129 prior to the institution of action. Baqwa J concluded in para [24] of the judgment that the plaintiff had not complied with the requirements of section 129, and held as follows in para [29] and [30]:

[29] The procedure to be followed where there is non-compliance with the requirements in serving a s 129 notice is set out in s 130(4), which reads as follows…

[30] In the circumstances I deem that an appropriate order is as follows:

[30.1] The application for summary judgment is postponed sine die.

[30.2] The plaintiff is directed to serve s 129(1)(a) notices on the defendants.

[30.3] There is no order as to costs.

14. Rossouw’s case (supra) did not concern an application for a postponement in accordance with the provisions of section 130(4)(b) of the NCA, and it is accordingly distinguishable from the facts of the present matter.

15. Ms. Wharton contends that the full bench decision in this division in Pillay (supra) is clearly wrong, and that I should therefore deviate from it. I am in respectful disagreement with this submission and find that I am bound by the decision in Pillay. Notably, the judgment in Pillay was handed down more than 5 years after that in Rossouw.

16. Section 130(4)(b) is peremptory and obliges the court to adjourn the “proceedings” once non-compliance with section 129 has been established. The section does not limit its application to only certain types of court proceedings, and must therefore include summary judgment proceedings.

17. I am accordingly inclined to grant the plaintiff the postponement which it seeks in accordance with section 130(4)(b) of the NCA. Notably the defendant relies upon an email, annexed to her opposing affidavit as annexure “MC1”, which she addressed to Gouws on 3 June 2019 wherein she simply states:

Dear Mr Gouws,

I would hereby confirm that I Marlene Coetzee gave Mr. Gutman authority to request information on my accounts, credit cards / personal account / business accounts.

Kind regards,

Marlene Coetzee

18. It is doubtful whether such an email indeed gave Gutman the authority to amend the defendant’s chosen domicilium address, as it simply provides him with authority to “request information”. The plaintiff does not have an opportunity

to file a replying affidavit in summary judgment proceedings so it is uncertain what its position is in this regard. Nevertheless, I make no finding on this aspect as the plaintiff itself has conceded non-compliance with section 129 read with section 130 of the NCA, and has requested the postponement in accordance with section 130(4)(b). Such concession was not made in the summary judgment affidavit but rather by Mr. Jonker in his heads of argument. Mr. Jonker informs the court that such concession was made by the plaintiff upon the advice of its legal representation, in order to avoid the costs which may be associated with a trial which could be avoided should non-compliance with the NCA be capable of being resolved at this early stage, thereby possibly avoiding a trial.

19. The defendant has also challenged the validity of the affidavit filed in support of the summary judgment application on the basis that Gouws purported to verify facts and a cause of action which was incorrect in that the pleaded domicilium address was not the updated domicilium address, and that had Gouws had regard to the aforementioned email which had been addressed to him he would have known that the

defendant had updated her address. For the reasons set out above, it is doubtful whether there is any merit in this submission.

Moreover, the fact that the deponent may have overlooked or ignored a single email, which could be for a number of different reasons (all of which would be speculative at this point in time) does not mean that the entire affidavit lacks veracity and that he does not have personal knowledge of the facts which he has verified. In fact, all of the emails annexed to the defendant’s opposing affidavit were addressed to Gouws, indicative of the fact that he was personally dealing with the matter, and would have had the requisite personal knowledge as envisaged in Rees & Another v Investec Bank Limited 2014 (4) SA 220 (SCA).

20. The second defence raised by the defendant, in respect of the arrear amount, shall be dealt with when the matter is again set down for hearing, and I therefore make no finding regarding the merits of such defence.

21. Accordingly, the following order is made:

1. The application for summary judgment against the defendant is postponed sine die in terms of section 130(4)(b) of the National Credit Act 34 of 2005 (“the NCA”);

2. The plaintiff is authorized, pursuant to the provisions of section 130(4)(b) of the NCA, to provide a notice to the defendant as contemplated in sections 129 and 130 thereof in any manner authorized by the Act and to the defendant’s chosen domicilium address at 2[...] S[...] Road, Saldanha Bay;

3. Such notice must, in addition to the normal contents thereof, also reflect:

a. The fact that action has been instituted against the defendant, the relevant case number and the fact that it has been postponed sine die;

b. The current amount of arrears;

c. That the defendant’s rights in terms of the NCA remain unaffected by the fact that action has already been instituted against her;

4. The plaintiff is granted leave, at least 10 (ten) court days after compliance with paragraphs 2 and 3 above, to set the application for summary judgment down on 5 (five) days notice to the defendant, provided the defendant has not within such time-frame exercised her rights in terms of the NCA, as envisaged in paragraph 3(c) above, and the plaintiff is granted leave to file a supplementary affidavit in terms of Practice Note 33(2) setting out its compliance with this order and its compliance with the provisions of the NCA;

5. Costs shall stand over for later determination.

NEL AJ