Standard Bank of South Africa Limited v TNBH (Proprietary) Ltd and Another (2021-28819) [2024] ZAGPPHC 1347 (19 December 2024)

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

GAUTENG DIVISION, PRETORIA

CASE NO: 2021-28819

(1) REPORTABLE: NO

(2) OF INTEREST TO OTHER JUDGES: NO

(3) REVISED.

DATE 19/12/2024

LENYAI J

In the matter of:

THE STANDARD BANK OF SOUT AFRICA LIMITED

Applicant

And

TNBH (PROPRIETARY) LTD

First Respondent

MARIUS STRYDOM

Second Respondent

Delivered: This judgment is handed down electronically by circulation to the Parties/their legal representatives by email and by uploading to Caselines. The date and time of hand-down is deemed to be 14:00 on 19 December 2024

JUDGMENT

[1] This is an application for summary judgment based on an installment sale agreement entered into by the applicant and the first respondent duly represented by the second respondent on the 11th February 2020.

[2] In terms of the agreement the applicant sold a 2018 Mercedes-Benz Vito 116 2.2CDi to the first respondent, with engine number 6[...] and chassis number W[...] (the goods). The principal debt advanced to the first respondent under the agreement was an amount of R593 685.60.

[3] The claim against the second respondent is based on a suretyship agreement which was executed on the 11th February 2020, wherein the second respondent bound himself as Co-Principal Debtor in solidum unto and in favour of the applicant in respect of any amounts then or thereafter due and payable by the first respondent to the applicant. The second respondent expressly renounced the benefits available in relation to sureties, including, inter alia of excussion, division of cession of action, as well as all other legal exceptions which may be raised or pleaded by a surety. The second respondent also agreed to be liable for all costs incurred by the applicant in the institution of legal action pursuant to the suretyship agreement and such costs to be calculated on the scale as between attorney and client.

[4] The applicant avers that in describing the first respondent the word “Natural” was typed instead of “juristic” in the particulars of claim. The attached instalment sale agreement clearly states juristic. The applicant avers that this was a clear clerical mistake which does not invalidate the agreement.

[5] The applicant further avers that a guarantee which is a direct link to the instalment sale agreement clearly indicated that the debtor’s full name is TNBH (PTY) LTD with registration number 2017/287206/07.

[6] The applicant contends that the deponent to the respondent’s answering affidavit was not a party to the instalment sale agreement and there is no resolution authorizing the deponent to sign documents on behalf of the first respondent. The applicant avers that the Company search it conducted, revealed that the second respondent is the sole director of the first respondent.

[7] The applicant avers that the second respondent further signed a declaration form on behalf of the first respondent which provides as follows:

7.1 “1. Declarations made by the Customer

We confirm that:

…

1.4 We accept the offer of the agreement contained in Part A and the related terms and conditions in Part B and further confirm that the Bank has giving us copies of these documents;”

[8] The applicant further avers that Part B of the agreement provides as follows:

8.1 “ Part B – Terms and conditions granted to a juristic person,

1.3 Agreement means the cost of credit section ( Part A) of this agreement, attached to and read together with these terms and conditions (Part B) and all letters and notices relating to same.”

[9] The applicant submits that the respondents took possession of the goods and started making payments as per the instalment sale agreement. The applicant further avers that in due course the respondents failed to make regular payments in terms of the agreement. On the 6th May 2021 the applicants submits that it sent a letter of demand to the respondents, at their chosen addresses, by way of registered post, informing them of the default and requesting the first respondent to remedy its breach of the agreement. The applicant further attached the proofs of postage and track and trace reports of the postages to the founding affidavit.

[10] The applicant avers that the respondents were indebted to it as at the 8th February 2023 in the amount of R620 636.78 together with interest thereon at the rate of 12.32% from 08 February 2023 to date of payment. The applicant submits that a cancellation letter dated the 27th May 2021 was sent to the respondents, confirming the applicant’s election to cancel the instalment sale agreement and claim repossession of the goods, arrears, interest, costs and damages as it is entitled to in terms of the instalment agreement.

[11] The applicant avers that the instalment sale agreement is exempt from the National Credit Act 34 of 2005 (NCA) by virtue of the fact that the first respondent is a juristic person with an annual turnover of asset value exceeding R1 000 000.00 as provided for in Section 4(1)(a)(i) of the NCA, alternatively exempt by virtue of Section 4(1)(b) of the NCA in that the agreement is a large agreement as defined in Section 7(1) of the NCA, despite the first respondent ‘s turnover or asset value being less than R 1 000 000.00. The applicant further avers that the NCA is also not applicable to the suretyship agreement in terms of section 4(2)(c) and section 8(5) of the NCA.

[12] The applicant contends that the respondents did not raise the issue of the liquid document in their pleadings and should not be allowed to do so in argument. The applicant further contends that the respondents’ plea does not raise any triable issues let alone a bona fide defense and the summary judgement application should be granted.

[13] The respondents oppose the application for summary judgement as they are of the view that they have a defense to the applicant’s claim. The respondents deny that they entered into an instalment sale agreement with the applicant. They submit that what the applicant attached to its particulars of claim as “Annexure A” is a pre-agreement quotation and not an instalment agreement as alleged by the applicant.

[14] The respondents contend that in the absence of the instalment sale agreement, the court cannot grant summary judgement as the claim is not based on a liquid document.

[15] The respondents aver that the applicant admits that it made a mistake in its particulars of claim as the word natural instead of a juristic was typed when the description of the agreement was typed.

[16] The respondents in their opposing affidavit admitted that the second respondent signed Part A and B of the agreement as well as the suretyship agreement. They however deny that there are any obligations in respect of which the first respondent can be in default of or in breach of as there is no agreement that can be cancelled.

[17] The respondents submit that they are not disputing that the second respondent signed the quotation, they are simply not accepting that the quotation is an instalment sale agreement as alleged by the applicant.

[18] The respondents argued in court as well as in their heads of argument that there is no liquid document that was attached to the pleadings by the applicant and as a result, the applicant has not satisfied the requirements for the granting of a summary judgement.

[19] The respondents contend that the applicant should have brought a Rule 7 application if they have a challenge to Mr Slabbert’s claims that he is authorised to depose to an affidavit on behalf of the first respondent.

[20] The respondents insist that the NCA is applicable to the agreement.

[21] The principles governing summary judgement are provided for in Rule 32 of the Uniform Rules of Court and have become trite.

21.1 Rule 32(1) enables a plaintiff to apply to court for summary judgement in respect of four categories of claims namely:

(a) on a liquid document;

(b) for a liquidated amount in money;

(c) for delivery of specified movable property; or

(d) for ejectment,

together with any claim for interest for interest and costs.

21.2 In terms of Rule 32(2)(b), the plaintiff (applicant) is required to:

(a) verify the cause of action and the amount claimed;

(b) identify any point of law relied upon;

(c) identify the facts upon which the plaintiff’s claim is based and

(d) explain briefly why the defence as pleaded does not raise any triable issue for trial.

[22] For a respondent to succeed in resisting an application for summary judgment, it must be shown that there is a bona fide defence to the applicant’s claim which raises a triable issue. The respondent must fully disclose the nature and grounds of the defence, and the material facts relied upon therefor. In the matter of Breitenbach v Fiat SA (Edms) Bpk 1976 (2) SA 226 (T) at 229F-H, the court held that bald, vague and sketchy defences should not be tolerated.

[23] In the matter of Joob Joob Investments (Pty) Ltd v Stocks Mavundla Zek Joints Venture (161/08) [2009] ZASCA 23; 2009 (5) SA 1 (SCA); [2009] All SA 407 (SCA) (27 March 2009), the court held that:

“[31] So too in South Africa, the summary judgement procedure was not intended to ‘shut (a defendant) out from defending’, unless it was very clear indeed that he had no case in the action. It was intended to prevent sham defences from defeating the rights of parties by delay, and at the same time causing great loss to plaintiffs who were endeavoring to enforce their rights.

[32] The rationale for summary judgement proceedings is impeccable. The procedure is not intended to deprive a defendant with a triable issue or a sustainable defence of her/his day in court. After almost a century of successful application in our courts, summary judgment applications can hardly continue to be described as extraordinary. Our Courts, both of first instance and at appellate level, have during that time rightly been trusted to ensure that a defendant with a triable issue is not shut out. In the Maharaj v Barclays National Bank Ltd 1976 (1) SA 418 (A) case at 425G – 426E, Corbett JA, was keen to ensure first, an examination of whether there has been sufficient disclosures by a defendant of the nature and grounds of his defence and the facts upon which it is founded. The second consideration is that the defence so disclosed must be both bona fide and good in law. A court which is satisfied that this threshold has been crossed is then bound to refuse summary judgment. Corbett JA also warned against requiring of a defendant the precision apposite to pleadings. However, the learned judge was equally astute to ensure that recalcitrant debtors pay what is due to a creditor.

[33] Having regard to its purpose and its proper application, summary judgment proceedings only hold terrors and are ‘drastic’ for a defendant who has no defence. Perhaps the time has come to discard these labels and to concentrate rather on the proper application of the rule, as set out with customary clarity and elegance by Corbett JA in the Maharaj case at 425G – 426E,”

[24] In the matter of NPGS Protection and Security Services CC and Another v FirstRand Bank Ltd (314/2018) [2019] ZASCA 94; [2019] 3 All SA 391 (SCA); 2020 (1) SA 494 (SCA) (6 June 2019) at paragraph 11, the court held as follows in relation to denials in pleadings:

“Rule 32(3) of the Uniform Rules requires an opposing affidavit to disclose fully the nature and grounds of the defense, and the material facts relied upon therefor. To stave off summary judgment, a defendant cannot content him or herself with bald denials, for example, that it is not clear how the amount claimed was made up. Something more is required. If a defendant disputes the amount claimed, he or she should say so and set out a factual basis for such denial. This could be done by giving examples of payments made by them which have not been credited to their account”

[25] It is trite that a suretyship is, by its nature, an accessory to a contract. See the matter of Kloe-Daley v Barclays National Bank Limited [1984] ZASCA 90; 1984 (4) SA 609 (A) at 623I-624G. For there to be a valid suretyship there must be a valid principal agreement or contract.

[26] It is also trite that the exercise of interpreting a deed of suretyship invokes the application of the same principles relating to the interpretation of contracts. These principles were well established in the matter of Bekker NO v Total South Africa (Pty) Ltd 1990 (3) SA 159 (T) at 170G-H by Kriegler J, which was quoted by the Supreme Court of Appeals in the matter of Moss & Another v KMSA Distributions (673/2018) [2019] ZASCA 81 (31 May 2019) at paragraph 8 where Kriegler J stated as follows:

“The interpretation of a written document is not an exercise in the arcane. It is a logical process in which the interpreter seeks the intention of the draftsman as embodied in the instrument. The mutual intention of the parties to a bilateral contract is, of course, an abstraction. The primary method to find out what the abstract was is to ask: What did the parties say ? That does not mean picking away at words like a guineafowl down a row of maize seeds. One looks at the language used with both sense and perceptive.”

[27] In the same matter of Moss & Another v KMSA Distributions at paragraph 10, the court stated as follows:

“In Privest Employees Solutions (Pty) Ltd v Vital Distribution Solutions (Pty) Ltd 2005 (5) SA 276 (SCA) paras 22 and 23, this court held that when construing an agreement comprising more than one document, one must consider all the terms used by the

parties in all the documents to determine the meaning thereof. Terms in a subsidiary document can prescribe how the terms in the main document are to be construed. In this case, that principle was embodied in the dealer agreement under clause 2.1.7 in the following terms :

‘Annexures to this agreement [form] part of the agreement and will not be interpreted in a separate manner or be separated from this agreement for construction of a different meaning.’

[28] Turning to the matter before me, the hurdle that the applicant must jump is whether it has complied with the requirements of Rule 32(2) of the Uniform Rules of Court. The respondents contends that they have not complied as there is no instalment sale agreement to speak of as the document that was signed is a quotation and therefore the applicant has not made out a cause of action.

[29] As the court has stated in the matter of Moss & Another v KMSA Distributions, wherein the court referred to the matter of Privest Employees Solutions (Pty) Ltd v Vital Distribution Solutions (Pty) Ltd, the SCA held that when construing an agreement comprising of more than one document, one must consider all the terms used in all the documents to determine the meaning thereof. I would go as far as to say, by scrutinizing all the documents carefully, the true intention of the parties will become clear. A party cannot simply rely on technicalities to escape liability based on an agreement.

[30] On careful consideration of the documents signed by the parties, Part A of the document bears the following descriptions:

(a) On the top left hand side of the document the following words appear:

Part A, Pre-Agreement Quotation/Cost of Credit.

(b) On the top right hand side of the same document the following words appear:

Type of Agreement – Credit Transaction, Instalment Sale Agreement (Juristic).

[31] In this case there are several documents that are linked Part A that have been signed by the second respondent: on behalf of the first respondent

(a) Authority for mandate and payment instruction;

(b) Declaration made by customer, where under clause 1.4 it is stated that: “we accept the offer of the agreement contained in Part A and the related Part B and further confirm that the Bank has given us copies of these document;”

(c) Part B – Terms and Conditions granted to a Juristic person. I have observed that the heading of this document is “Type of Agreement – Credit Transaction Instalment Sale Agreement (Juristic Person).

Clause 1.3 clearly prescribes as follows:

(1) “Agreement means the cost of credit section (Part A) of this agreement, attached to and read together with these terms and conditions (Part B) and all letters and notices relating to same”

(2) Furthermore Clause 1.23 of Part B provides as follows:

“Guarantor(s) means a person(s) who undertake(s) to pay, in full or in part, the amount owing in terms of this agreement in the event of a default by you under this agreement”

(3) Clause 1.45 of Part B provides as follows:

“Surety(ies) means a person(s) who undertake(s) to pay in full or in part, the amount owing in terms of this agreement in the event of a default by you under this agreement”

(d) Acknowledgement of freedom of choice

(e) Insurance Details and Proposals

(f) Statutory disclosures in terms of the Financial Advisory and Intermediary Services Act, 2002 (FAIS Act) and Data Privacy

(g) Standard Insurance Limited, Commercial Asset Shortfall, Top-Up Policy Summary of Material Terms

(h) Insurance Discussion Form

[32] The respondents at paragraph 5 of its amended plea admitted that the second respondent signed the suretyship marked “B”. The second respondent has bound himself to paying the outstanding amount due to the applicant.

[33] I am satisfied that there is a valid instalment agreement and a valid suretyship in place. The applicants are also claiming for the return and delivery of the goods which have been in the possession of the first respondent since the 12th February 2020.

[34] The applicant has explained the clerical mistake of typing the word natural instead of juristic in its particulars of claim. I have scrutinized the documents, and the mistake is not material, and, in my view, it is a minor error which does not detract from the intent of the parties to the contract.

[35] The respondents on the other hand have made bald and sketchy denials in their plea without substantiating with clear reasons. The respondents’ main defence was that there is no instalment sale agreement as they only singed a quotation. I have already ruled that there is a valid instalment sale agreement together with a suretyship.

[36] The respondents further made arguments in their heads of argument as well as in court, which are not in their pleadings. This kind of conduct is not acceptable as it is trite that a litigant must set out its case in its pleadings and not in argument.

[37] I am of the view that the applicant has satisfied the requirements for summary judgment and the respondents have not convinced the court that they have a bona fide defence which raises a triable issue.

[38] Under the circumstances I make the following order:

1. The cancellation of the instalment sale agreement is confirmed;

2. The first respondent is directed to restore to the applicant possession of the Goods, being a 2018 MERCEDES BENZ VITO 116 2.2CDi with Chassis Number: W[...] and Engine Number: 6[...];

3. The applicant is entitled to retain all monies paid to it by the first respondent pursuant to the instalment sale agreement;

4. Leave is granted to the applicant to apply on the same papers, duly supplemented where necessary for;

4.1 damages, if any, in an amount to be calculated by subtracting the current market value of the Goods (as well as a rebate on unearned finance charges from the balance outstanding, if applicable);

4.2 interest on the said damages at the rate of 08.385% per annum from 24 July 2020 to date of payment; and

5. Costs of suit on an attorney and client scale.

LENYAI J

JUDGE OF THE HIGH COURT

Appearances

Counsel for Applicant: Adv C Nkosi Instructed by: Findlay & Niemeyer Attorneys Counsel for the Respondents: Adv E Coleman Instructed by: McCarthy Cruywagen Date of hearing: 07 August 2024 Date of Judgement: 19 December 2024