Standard Bank of South Africa Ltd v Talbot and Another (833/2014) [2015] ZANWHC 31 (23 July 2015)

IN THE HIGH COURT OF SOUTH AFRICA

NORTH WEST DIVISION, MAHIKENG

CASE NO: 833/2014

In the matter between:-

STANDARD BANK OF SOUTH AFRICA LTD

Plaintiff

and

BRIAN COLIN TALBOT

1st Defendant

BAREND JOHANNES BOTHA

2nd Defendant

DATE OF HEARING

: 11 JUNE 2015

DATE OF JUDGMENT

:

11 JUNE 2015

DATE OF REASONS FOR JUDGMENT :

23 JULY 2015

COUNSEL FOR THE PLAINTIFF

: MR. M WESSELS

COUNSEL FOR DEFENDANTS

: ADV. D SMIT

REASONS FOR JUDGMENT / ORDER

HENDRICKS J

Introduction:-

[1] On 11 June 2015, I granted an order in the following terms:-

“The Court grants summary judgment in favour of the Plaintiff against the First and Second Defendants jointly and severally, the one paying the other to be absolved;

(a) Payment of the amount of R1 523 739.53, together with interest thereon at the rate of 9.5% per annum (prime plus 0.5%), calculated daily and compounded monthly in arears from the 25th day of March 2014 to date of payment;

(b) Costs of suit.”

On 02 July 2015 a request for reasons for judgment was filed with the Registrar of this Court. Here follows the reasons for judgment.

[2] The undisputed facts of this case are uncomplicated. Dikuno Castings and Metals (Pty) Ltd (“Principal Debtor”) had a current account with Standard Bank of South Africa LTD (“Plaintiff”). From time to time Plaintiff allowed the Principal Debtor overdraft facilities on the said account on certain conditions. The First and Second Defendants together with one Jeremy Paul Tucker bound themselves generally as sureties and co-principal debtors for the Principal Debtor’s indebtedness to the Plaintiff in respect of money lent and advanced, or money overdrawn on any account to an unlimited amount.

[3] On 07 April 2014 the current account of the Principal Debtor was overdrawn. The Principal Debtor owed the Plaintiff the amount of R1 523 739.53 together with interest at the rate of 9.5% per annum. The Principal Debtor has been liquidated. Plaintiff issued summons against the First and Second Defendants as sureties. Both Defendants

filed notices of intention to defend the action. A notice of application for summary judgment was subsequently filed. Only the

Second Defendant filed an affidavit opposing summary judgment. The opposed summary judgment application was argued on the 11 June 2015 whereupon an order was granted in the terms as set out in paragraph [1] hereof.

[4] At the hearing of oral argument, two points were raised in limine by the Second Defendant namely:

(a) that the deponent to the affidavit in support of the summary judgment application does not have the required authority to depose to the affidavit on behalf of the Plaintiff;

(b) that the registered slips pertaining to the Section 129 notices were not initialled or signed by a post office official. I will deal with these two points in limine first, before dealing with the merits.

Point in limine: lack of authority

[5] In the affidavit in support of the summary judgment application, Chube Provia Mothapo (“Mothapo”), the deponent, states:-

“1

I am a Manager, Business Support, Rescue & Recoveries, Personal and Business Banking Credit, a division of the Credit Division of the Plaintiff, with a business address situated at 1st Floor Sancardia Building, Cnr of Stanza Bopape & Steve Biko Streets, Arcadia, Pretoria, Gauteng, and am duly authorised to depose to this affidavit.

2

2.1 The facts contained in this affidavit are within my personal knowledge, unless otherwise stated or appears so from the context, and are to the best of my knowledge and belief both true and correct, by virtue of:

2.1.1 my position as Manager, Business Support, Rescue & Recoveries, Personal and Business Banking Credit, a division of the credit division of the Plaintiff; and

2.1.2 the fact that the file, documents and records, electronic and physical, relating to the indebtedness of the principal debtor, Dikuno Castings and Metals (Pty) Ltd (In Liquidation), as referred to in Plaintiff’s particulars of claim herein, together with all security given for such indebtedness, is in my possession and under my control and I have full knowledge of such file and all security upon which reliance is placed in the particulars of claim.

2.2 Where such facts do not strictly speaking fall within my personal knowledge, such facts do appear from the aforesaid file, documents and records, electronic and physical, all of which I have referenced. Such facts herein stated have been obtained by perusal of the said file, documents and records, electronic and physical.

2.3 I am also competent to produce in evidence all the documentation annexed to Plaintiff’s particulars of claim and supporting the allegations made herein and to testify as to their content.

3

3.1 I hereby confirm and swear positively to the facts, verifying the cause of action and confirm further that the Defendants are truly indebted to Plaintiff the outstanding amount, interest and cost as reflected in and on the grounds stated in Plaintiff’s Summons, Particulars of Claim and the annexures thereto.

4

I truly believe that the Defendants do not have a bona fide defence to the Plaintiff’s claim and that appearance has been entered solely for the purpose of delay.

5

I accordingly pray that Summary Judgment be granted against the First and Second Defendants as prayed in the Notice of Motion.”

[6] It was contended that

“(i) The description of the deponent’s actual position is vague and embarrassing and it is not clear of what her actual position and duties are.

(ii) The deponent states that she is duly authorised to depose to the affidavit, however, she fails to state from where she obtained this authority.

(iii) Nor does the deponent state that she actually has the authority to represent the Plaintiff in these proceedings and from where such authority had been obtained.

(iv) The deponent is not a director of the Plaintiff and has not provided any resolution taken which will give her the required authority.”

[7] In my view, Mothapo does state her designated appointment within the structure of the Plaintiff and that she is duly authorised to depose to the affidavit. In a summary judgment application, the deponent need not be authorised in order to depose to such an affidavit. The authorisation of such a deponent should not be confused with the authorisation of the institution and prosecution of proceedings on behalf of another party,

See: Firstrand Bank Limited v Carl Beck Estates (Pty) Ltd and Another 2009 (3) SA 384 (E) at page 391 F to 392.

Firstrand Bank Limited v Fillis and Another 2010 (6) SA 565 (ECB) at page 569 paragraph [13].

Dean Gillian Rees v Investec Bank Limited [330/13] ZASCA 38 [20 March 2012].

[8] Rule 32(2) of the Uniform Rules of Court provides that the Plaintiff’s notice of application for summary judgment shall be accompanied by ‘an affidavit made by himself or by any other person who can swear positively to the facts verifying the cause of action and the amount, if any, claimed and stating that in his opinion there is no bona fide defence to the action and that notice of intention to defend has been delivered solely for the purpose of delay’.

Rule 32 of the Uniform Rules of Court simply does not require a

deponent to a supporting affidavit, having to proof his/her authority to act on behalf of a company to a greater extent than making the averment that he/she is duly authorised to depose to the affidavit.

[9] In Shackleton Credit Management (Pty) Ltd v Microzone Trading 88 CC & another 2010 (5) SA 112 (KZP), para 13, it was held that:

‘[F]irst-hand knowledge of every fact which goes to make up the applicant’s cause of action is not required, and that where the applicant is a corporate entity, the deponent may well legitimately rely on records in the company’s possession for their personal knowledge of at least certain of the relevant facts and the ability to swear positively to such facts.’

[10] At the end of the day, whether or not to grant summary judgment is a fact-based enquiry. Many summary judgment applications are brought by financial institutions and large corporations. First-hand knowledge of every fact cannot and should not be required of the official who deposes to the affidavit on behalf of such financial institutions and large corporations. To insist on first-hand knowledge is not consistent with the principles espoused in Maharaj v Barclays National Bank Ltd 1976 (1) SA 418 (A)

See: Dean Gillian Rees v Investec Bank Limited, supra

Point in Limine: Post Office Slip not initialled or signed.

[11] It was contended on behalf of the Second Defendant that because the post office slip that proves that a registered letter/article was send by post was not initialled or signed by a post office official, the Section 129 notices that were dispatched to the Defendants were sent irregularly because it was not properly accepted by the post office concerned.

[12] The registered post office slips contains stamps of the Garsfontein Post Office. In my view, the fact that these slips have not been signed by an official of the Garsfontein Post Office does not render the said slips illegal. The important factor for consideration is whether such a letter/parcel was received by the post office and dispatched in its registered postal system. The track-and-trace result serves as proof in this regard. The registered letters were dispatched from Garsfontein Post Office and indeed reached Rustenburg Post Office. A notification was dispatched to the Second Defendant to collect the registered letter/parcel. This second point raised in limine does not hold any water. Like in the case of the first point in limine raised, this point in limine should also be rejected.

The Merits

[13] The fact that the Second Defendant, like the first Defendant and Jeremy Paul Tucker, entered into a written deed of suretyship with the Plaintiff is undisputed.

Clause 16 of the deed of suretyship contains a non-variation clause and states as follows:-

“Geen kansellasie of wysiging van hierdie borgstelling is hoegenaamd geldig nie, tensy en totdat dit op skrif gestel en deur of namens die Bank en die Borg onderteken word.”

Clause 21 states:-

“Geen toegewing, verslapping of verlenging van tyd wat die Bank aan die Borg of die Skuldenaar verleen mag onder enige omstandighede geag word in afstanddoening van enige regte ingevolge hierdie borgstelling te wees nie en die Bank bly geregtig om tydeige en stiptelike

nakoming van elke bepaling van hierdie borgstelling van die Borg te vereis.”

Clause 22 states:-

“Hierdie akte sit die hele ooreenkoms tussen die Bank en die Borg ten opsigte van hierdie borgstelling uiteen en die Bank word nie gebind deur enige ondernemings, voorstellings of waarborge wat nie uitdruklik hierin uiteengesit word nie.”

[14] The defence raised by the Second Defendant is to the extend that there was an oral agreement reached that the Plaintiff would not proceed with any action against the sureties until the liquidation of the Principal Debtor is finalised. This contention is contrary to the non-variation clauses of the deed of surety. Furthermore, no proof exist that the parties indeed signed an amendment to the deed of suretyship.

See: Clauses 16 and 22 of the deed of suretyship.

[15] Where parties to a contract impose restrictions on their own power to vary or cancel a contract, they do so to achieve certainty and to avoid later disputes. The obligation to reduce the variation agreement to writing and have it signed was aimed at preventing

disputes regarding the variation itself:See: • Spring Forest Trading 599 CC v Wilberry (ty) Ltd t/a Ecowash and Another (725/13) [2014] ZASCA 178 (21November 2014)

• SA Sentrale Ko-op Graanmaatskappy Bpk v Shifren & andere 1964 (4) SA 760 (A)

• Brisley v Drotsky 2002 (4) SA 1 (SCA)

• Christie’s: The Law of Contract in South Africa, 6th edition at page 464-466.

[16] No other defence was raised on the merits. Summary judgment, which deprives a defendant of the opportunity to raise its defence in trial proceedings, should be granted only exceptionally: it is said to be a drastic procedure. However, as was stated by Navsa JA in Joob Joob Investments (Pty) Ltd v Stocks Mavundla Zek Joint Venture 2009 (5) SA 1 (SCA) at Paragraphs [32] and [33].

“[32] The rationale for summary judgment 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 proceedings 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 case at 425G-426E, Corbett JA was keen to ensure, first, an examination of whether there has been sufficient disclosure 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.”

[17] Having regard to the above stated and in particular the fact that

no bona fide defence was raised by the Second Defendant to the merits of this application for summary judgment, I granted the order as contained in paragraph [1] supra.

R D HENDRICKS

JUDGE OF THE HIGH COURT