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South Africa Judgment

South Gauteng High Court, Johannesburg

Sasfin Bank Ltd and Another vs Melamed and Hurwitz Incorporated and Anothers (31948/19) [2022] ZAGPJHC 1039 (21 November 2022)

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Professional case brief

Research organized from the available case record

Source document

01

Holding and result

The court found that the Second Applicant failed to demonstrate reasonable prospects of success on appeal, particularly regarding the refusal of condonation for the late rescission application. The deficiencies alleged in the suretyship agreement did not amount to a bona fide defense sufficient to warrant rescission. The standard for granting condonation is stringent, and the Second Applicant did not meet the requirements. Consequently, the application for leave to appeal was dismissed.

Court disposition

Application for leave to appeal dismissed with costs.

Orders

  • The application for leave to appeal is dismissed.
  • The Second Applicant is ordered to pay the costs of the application.

02

Material facts

Parties

Sasfin Bank Ltd

Respondent Counsel: Adv. S Aucamp

Sunlyn (Pty) Ltd

Respondent Counsel: Adv. S Aucamp

Melamed and Hurwitz Incorporated

Applicant Counsel: Adv. V Vergano

Stephen Melamed

Applicant Counsel: Adv. V Vergano

03

Procedural history

  1. Posture

    Leave to Appeal / Application for Leave to Appeal Following Refusal of Rescission

04

Questions and positions

Legal issues

Party arguments

Applicant
The Second Applicant argued that there are reasonable prospects of success on appeal, as he provided a reasonable explanation for his default, acted bona fide, and presented a bona fide defense based on deficiencies in the wording of the suretyship agreement. He also sought condonation for filing the rescission application outside the prescribed 20-day period, contending that another court may find good cause for granting rescission.
Respondent
The Respondents maintained that the Second Applicant failed to meet the requirements for rescission under Rule 31(2)(b), particularly regarding the explanation for default and the lateness of the application. They argued that the court correctly refused condonation and that the alleged deficiencies in the suretyship agreement did not constitute a bona fide defense.

05

Court’s reasoning

  1. 01

    Section 17(1)(a)(i) of the Superior Courts Act

    The test for granting leave to appeal is whether there is a reasonable prospect that another court would come to a different conclusion.

  2. 02

    Ex parte Neethling and others 1951 (4) SA 331 (A) at 335D-E

    Condonation for non-compliance with time periods in the Rules is only granted on limited grounds.

  3. 03

    [2021] ZASCA 31 at para 10

    The approach to prospects of success in leave to appeal applications is set out in Ramakatsa and others v African National Congress and Another.

  4. 04

    Trencon Construction (Pty) Ltd v Industrial Development Corporation of South Africa Limited 2015 (5) SA 245 (CC) at [88]

    The standard for interference on appeal regarding condonation is restrictive.

06

Ratio, limits and disposition

Ratio decidendi

The court found that the Second Applicant failed to demonstrate reasonable prospects of success on appeal, particularly regarding the refusal of condonation for the late rescission application. The deficiencies alleged in the suretyship agreement did not amount to a bona fide defense sufficient to warrant rescission. The standard for granting condonation is stringent, and the Second Applicant did not meet the requirements. Consequently, the application for leave to appeal was dismissed.

Obiter and limits

  • The court noted that condonation for late filing is not lightly granted and requires compelling justification.
  • The evidence regarding the wording of the suretyship agreement was insufficient to establish a bona fide defense.

Court disposition

Application for leave to appeal dismissed with costs.

  • The application for leave to appeal is dismissed.
  • The Second Applicant is ordered to pay the costs of the application.

Source and reliance status

South Gauteng High Court, Johannesburg

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Judgment reading view

Judgment text

The complete available source text.

Source document

South Gauteng High Court, Johannesburg

Judgment

[2022] ZAGPJHC 1039

IN

THE HIGH COURT OF SOUTH AFRICA

(GAUTENG DIVISION, JOHANNESBURG)

Case No: 31948/19

REPORTABLE: NO.

OF INTEREST TO OTHER JUDGES: NO.

REVISED

In the matter between:

SASFIN

BANK LTD

First Plaintiff/ Respondent

SUNLYN (PTY) LTD Second

Plaintiff/ Respondent

and

MELAMED AND HURWITZ INCOPRORATED First Applicant/ Defendant

STEPHEN

MELAMED Second

Applicant/ Defendant

JUDGMENT

Todd AJ

1. This is an application for leave to appeal against a judgment that I handed down on 24 August 2022.

2. The Second Applicant seeks leave to appeal on the ground that an appeal would have a reasonable prospect of success as contemplated in section 17(1)(a)(i) of the Superior Courts Act. In assessing prospects of success I follow the approach described in Ramakatsa and others v African National Congress and Another [2021] ZA SCA 31 at para 10.

3. The focus of the application was this court’s decision to refuse the application for rescission brought under the provisions of Rule 31(2)(b). Ms Vergano, who appeared for the Second Applicant, submitted that there were reasonable prospects of persuading another court that the Second Applicant had shown good cause as contemplated in that provision, specifically that he had given a reasonable explanation for his default, that the application had been made bona fide and not for the purpose of delaying the matter, and that he had a bona fide defense to the claim. As regards the defense, Ms Vergano pointed primarily to the evidence of deficiencies in the wording of the suretyship agreement which had formed the basis for the claim against the Second Applicant.

4. A significant obstacle to the Second Applicant in the proceedings below was the need to seek condonation for the fact that rescission had been sought several months outside the 20 day period provided for in Rule 31(2)(b). That aspect of the matter was dealt with in paragraphs 20 to 22 of this court’s judgment. The standard for interference on appeal against a decision on a matter of that kind, involving condonation for failure to comply with a time period in the Rules, is limited to the grounds set out in Ex parte Neethling and others 1951 (4) SA 331 (A) at 335D-E. (See also Trencon Construction (Pty) Ltd v Industrial Development Corporation of South Africa Limited 2015 (5) SA 245 (CC) at [88].)

5. It seems to me that there is little prospect of success on appeal on this aspect of the matter, and that this is fatal to the present

application.

6. For those reasons, the application for leave to appeal is dismissed, with costs.

C Todd

Acting Judge of the High Court of South Africa

REFERENCES

For the Second Applicant: Adv.

V Vergano

Instructed by:

Howard

S Woolf Attorneys

For Respondents:

Adv. S Aucamp

Instructed by:

Smit Jones & Prat

Hearing date:

17 November 2022

Judgment delivered:

21 November 2022

Source wording is retained. Consult the source document for its original formatting and pagination.

Authorities

Authorities used by the court

Cases, legislation, regulations, and constitutional provisions identified in the available record.

Ramakatsa and others v African National Congress and Another [2021] ZASCA 31

Case cited

Ex parte Neethling and others 1951 (4) SA 331 (A)

Case cited

Trencon Construction (Pty) Ltd v Industrial Development Corporation of South Africa Limited 2015 (5) SA 245 (CC)

Case cited

Superior Courts Act

Legislation

Legislation referenced in the available case record.

Uniform Rules of Court, Rule 31(2)(b)

Legislation

Legislation referenced in the available case record.

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