Case Law[2024] ZAGPJHC 451South Africa
Hamze Trading (Pty) Ltd v Alf's Tippers CC (20955/2022) [2024] ZAGPJHC 451; [2024] 3 All SA 248 (GJ) (6 May 2024)
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# South Africa: South Gauteng High Court, Johannesburg
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## Hamze Trading (Pty) Ltd v Alf's Tippers CC (20955/2022) [2024] ZAGPJHC 451; [2024] 3 All SA 248 (GJ) (6 May 2024)
Hamze Trading (Pty) Ltd v Alf's Tippers CC (20955/2022) [2024] ZAGPJHC 451; [2024] 3 All SA 248 (GJ) (6 May 2024)
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sino date 6 May 2024
SAFLII
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Certain
personal/private details of parties or witnesses have been
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REPUBLIC
OF SOUTH AFRICA
IN
THE HIGH COURT OF SOUTH AFRICA
GAUTENG
DIVISION, JOHANNESBURG
CASE NO.: 20955/2022
1.
REPORTABLE:
YES.
2.
OF
INTEREST TO OTHER JUDGES: YES.
3.
REVISED:
NO.
6 May
2024
In
the matter between:
HAMZE
TRADING (PTY)
LTD
Applicant
and
ALF’S
TIPPERS
CC
Respondent
This judgment was
handed down electronically by circulation to the parties’
representatives via e-mail, by being uploaded
to CaseLines and by
release to SAFLII. The date and time for hand-down is deemed to be
10:00 on 6 May 2024.
JUDGMENT
MEIRING, AJ:
INTRODUCTION
[1]
This is an application for the rescission
of a judgment granted by default in the respondent’s favour on
20 October 2022.
[2]
The
applicant seeks this relief on two alternative grounds, namely under
rule 31(2)(b) of the Uniform Rules of Court or, otherwise,
at common
law.
[1]
FACTS
[3]
Both the applicant’s affidavits are
thin. Contrariwise, in the answering affidavit, over 159 paragraphs
and 30 pages, the
respondent puts up a wealth of granular detail.
Oddly, while in the replying affidavit repeatedly asserting its
utmost good faith,
the applicant makes no general denial of the
averments in the answering affidavit. Also unhelpfully, saying that
it was so advised,
it pointedly refrains from responding
seriatim
or point-by-point to the contents of the answer. Accordingly, despite
the ample rhetoric of denial in the reply, the bulk of the
specific
factual averments in the answering affidavit must be taken to be
admitted. The heft of the applicant’s position
came to the fore
only in its heads of argument.
[4]
Fairly considered, then, the central facts
forming the backdrop to this application are these.
[5]
On or shortly after 14 December 2021, the
applicant, Hamze Trading, and the respondent, Alf’s Tippers,
both duly represented,
concluded a written agreement of
locatio
conductio
, comprised of a quotation of
Alf’s Tippers, dated 14 December 2021, and its standard
terms and conditions, both with
the name Alf’s Tippers printed
at the top.
[6]
The
object of the agreement was that the respondent would provide to the
applicant tipper trucks with drivers at an hourly rate
of R245, fuel
and VAT excluded, and calculated on a minimum of nine hours per
shift.
[2]
The applicant was to
use them at its mine site at Vioolsdrift, a village in the Northern
Cape, on the Orange River – named
it
seems
for
Jan
Viool, a Nama fiddler, who sometime in the nineteenth century was
wont musically to guide ox wagons across the ford.
[7]
On 16 January 2022, four trucks left
Elsburg, to Vioolsdrift. On 21 January 2022, another one set off.
Upon arrival, after the 15-hour
trek, they were put into service.
[8]
On 7 February 2022, Tanya Lourenco of the
applicant sent an e-mail message to Sarie Horn of the respondent,
saying: “
The 5 tippers have been
assisting so nicely at the site and therefore we require them for
another 252 hours. … Please send
us a quote for the 5 tippers
for 252 hours each.
”
[9]
The applicant thus wanted each tipper to
work two shifts a day, which proved to be too onerous in the light of
the extreme conditions
at the site. Accordingly, the parties agreed
that a further five trucks should be delivered to the applicant’s
site. Thus,
the written agreement was amended orally – despite
the whole-agreement clause in the terms and conditions and the
provision
there precluding variation or amendment other than in
writing signed by both parties.
[10]
On 28 February 2022, another four trucks
left Gauteng to the Orange River. On 3 March 2022, the last of the
team of ten set off.
[11]
While in the founding affidavit the
applicant alleges generally that the trucks performed poorly and were
already mechanically faulty
once they arrived – a position
contradicted by Ms Lourenco’s e-mail message to Ms Horn, quoted
above – the respondent
denies this, averring that the root
cause of whatever difficulties arose was that the site at Vioolsdrift
is “
extremely challenging
”,
the heat sweltering and the roads poorly maintained, causing
considerable wear and tear.
[12]
Soon, the contractual relationship between
the parties fizzled out. On the respondent’s version, which I
am enjoined to accept,
it terminated the contract on 6 April 2022, in
the light of the applicant’s failure to make proper payment. In
March 2022,
the applicant had started querying the number of hours
during which work had been done for which it was being charged,
despite,
as the respondent says, the hours having been based “
upon
time sheets signed off by [the applicant’s] supervisor
”.
[13]
On 6 April 2022, Alf’s Tippers
collected the full cohort of ten trucks for the long trip back to
Germiston.
[14]
After various e-mail exchanges between the
parties in the following weeks over the amount due and outstanding,
on 27 May 2022, under
section 345(1)(a)(i) of the Companies Act,
1973, the respondent directed to the applicant a demand for payment
of R350,075.54.
[15]
On 2 June 2022, the applicant’s
attorneys responded, contesting the suggestion of Hamze Trading’s
insolvency, and requesting
a debatement of the account (oddly,
perhaps, since recordkeeping at the coalface, so to speak, was
partially in its hands). The
applicant did not accede to the demand
for payment.
[16]
On 15 June 2022, the respondent issued
summons against the applicant for payment of R292,575.54. (The
difference between the amounts
in the section 345(1)(a) notice and
the summons is accounted for by the fact that the holding deposit for
the ten trucks came to
be credited to Alf’s Tippers.)
[17]
On 29 June 2022, the sheriff served the
summons on the applicant at its registered office, namely 3[...]
P[...] C[....], in Royldene,
Kimberley. That, as will appear
below, is a secure residential complex. On 6 October 2022, under rule
31(5)(b)(iv), a notice
of set-down was served at the same address.
[18]
In both cases, having made a diligent
search, the sheriff decided that there was no other means of
effecting service and indeed
effected service by affixing the
document to the post box of the unit of the applicant. As is borne
out by a photograph enclosed
with the answering affidavit, the post
boxes are located outside the main gate of the complex in a covered
space past which cars
entering the complex would have to drive. The
affixed documents, so the respondent avers, would have been clearly
visible to anyone
entering the complex. In the light of the approach
the applicant has taken to its replying affidavit, it does not deny
this. Indeed,
the picture bears this out.
[19]
On 22 October 2022, this court (
per
Wright J) granted default judgment against the applicant in an
application brought under rule 31(5)(a). On 7 February 2023, a writ
of execution was issued against the moveable and incorporeal property
of the applicant.
[20]
Only on 8 March 2023 did the applicant
learn of the default judgment. On 3 April 2023, the applicant brought
this application.
THE LAW ON RESCISSION
Introduction
[21]
The applicant seeks an order of rescission
on two alternative grounds, namely rule 31(2)(b) or at common law.
[22]
Rule
31 is one of the Uniform Rules of Court. It is no source of
substantive rights. In
Colyn
v Tiger Foods
Industries
Ltd t/a Meadow Feed Mills (Cape)
,
[3]
the
Supreme Court of Appeal dealt with the similar interplay between rule
42 and the common law, which by parity applies here too:
[4]
“
[Rule
42(1)(a)] is, for the most part at any rate, a restatement of the
common law. It does not purport to amend or extend the common
law.
That is why the common law is the proper context for its
interpretation. Because it is a Rule of Court its ambit is entirely
procedural.
”
[23]
At common law, there are various grounds
upon which a judgment might be set aside. One such case is where
judgment was granted by
default of appearance on the part of the
defendant, provided that good or sufficient cause for the rescission
is shown.
[24]
Rule 31(2)(b) restates that common-law
position, adding the limitation that it applies only to claims that
are not for a debt or
a liquidated amount (sub-rule 2(a)) and the
requirement that the application be brought within 20 days of the
applicant obtaining
knowledge of the default judgment (sub-rule
2(b)).
[25]
Rule 31(2) provides:
“
(2)(a)
Whenever in an action the claim or, if there is more than one
claim, any of the claims is not for a debt or liquidated
demand and a
defendant is in default of delivery of notice of intention to defend
or of a plea, the plaintiff may set the action
down as provided in
subrule (4) for default judgment and the court may, after hearing
evidence, grant judgment against the defendant
or make such order as
to it seems meet.
(b)
A defendant may within 20 days
after he has knowledge of such judgment apply to court upon notice to
the plaintiff to set aside
such judgment and the court may, upon good
cause shown, set aside the default judgment on such terms as it deems
fit
.
”
[emphasis added]
[26]
I turn then to consider what good or
sufficient cause is.
Good or sufficient
cause
[27]
In a series of judgments, our courts have
grappled with the meaning of the synonymous notions of “
good
cause
” and “
sufficient
cause
”. The following
dicta
,
marshalled chronologically, encapsulate the considerations of which
our courts have taken account. Having them serried sequentially,
as
below, allows one to appreciate how the framing of the test has
undergone some changes of emphasis and nuance. It is not uncommon
for
counsel to alight upon the three requirements stated in
Grant
(see below) or the two in
Chetty
(see below) as if a box-ticking exercise is both necessary and
sufficient. The inevitable result is some measure of confusion:
are
there two or are there three requirements (and are they
requirements)?
[28]
A
good place to start is the eloquent
locus
classicus
of
Cairns’
Executors v Gaarn
,
[5]
a decision of the Appellate Division in its infancy, in 1912. In
dealing with the meaning of “
sufficient
cause
”
as used in rule 12 in the Appellate Division Rules, Innes JA said
this:
[6]
“
It
would be quite impossible to frame an exhaustive definition of what
would constitute sufficient cause to justify the grant of
indulgence.
Any attempt to do so would merely hamper the exercise of a discretion
which the Rules have purposely made very extensive
and which it is
highly desirable not to abridge. All that can be said is that the
applicant must show … ‘something
which entitles him to
ask for the indulgence of the Court’. What that something is
must be decided upon the circumstances
of each particular
application
.”
[29]
On
the eve of the Second World War, in 1938, in
Scott
v Trustee, Insolvent Estate Comerma
,
[7]
the Witwatersrand Local Division (
per
Murray J) observed:
[8]
“
If
the defendant’s conduct is
mala
fide
and the Court is convinced that he
has no belief in the justice of his case but is merely alleging a
defence to delay enforcement
of the plaintiff’s just claim, he
is naturally not entitled to any relief for his default. But where he
has never clearly
acquiesced in the plaintiff’s claim, but
actually persisted in disputing it, it seems to me that the Court
should be slow
to refuse him entirely the opportunity of having his
defence heard
.”
[30]
In
1949, having surveyed among others those two
dicta
,
in
Grant
v Plumbers (Pty) Ltd
,
[9]
the Orange Free State Provincial Division (
per
Brink J) said:
[10]
“
Having
regard to the decisions above referred to, I am of opinion that an
applicant who claims relief under Rule 43 should comply
with the
following requirements:
(a)
He must give a reasonable
explanation of his default. If it appears that his default was wilful
or that it was due to gross negligence
the Court should not come to
his assistance.
(b)
His application must be
bona
fide
and not made with the intention of
merely delaying plaintiff’s claim.
(c)
He must show that he has a
bona
fide
defence to plaintiff’s claim.
It is sufficient if he makes out a
prima
facie
defence in the sense of setting
out averments which if established at the trial, would entitle him to
the relief asked for. He need
not deal fully with the merits of the
case and produce evidence that the probabilities are actually in his
favour.
”
[31]
Then,
in 1979, in
HDS
Construction (Pty) Ltd v Wait
,
[11]
the Eastern Cape Division (
per
Smalberger J) observed:
[12]
“
In
determining whether or not good cause has been shown, and more
particularly in the present matter, whether the defendant has
given a
reasonable explanation for his default, the Court is given a wide
discretion in terms of Rule 31(2)(b). When dealing with
words such as
‘good cause’ and ‘sufficient cause’ in other
Rules and enactments the Appellate Division
has refrained from
attempting an exhaustive definition of their meaning in order not to
abridge of fetter in any way the wide discretion
implied by these
words … The Court’s discretion must be exercised after a
proper consideration of all the relevant
circumstances. While it was
said in
Grant’s
case
that a Court should not come to the assistance of a defendant whose
default was wilful or due to gross negligence, I agree
with the view
… that while a Court may well decline to grant relief where
the default had been wilful or due to gross negligence
it cannot be
accepted ‘that the absence of gross negligence in relation to
the default is an essential criterion, or an absolute
prerequisite,
for the granting of relief under Rule 31(2)(b)’
.
It
is but a factor to be considered in the overall determination of
whether good cause has been shown although it will obviously
weigh
heavily against the applicant for relief
.”
[32]
Less
than a decade later, in 1985, in
Chetty
v Law Society, Transvaal
,
[13]
the
Appellate Division (
per
Miller
JA) again turned its attention to the question:
[14]
“
The
term ‘sufficient cause’ (or ‘good cause’)
defies precise or comprehensive definition, for many and various
factors require to be considered. (See
Cairn’s
Executors v Gaarn
1912 AD 181
at 186
per
Innes JA.) But it is clear that in principle
and in the long-standing practice of our Courts two essential
elements of ‘sufficient
cause’ for rescission of a
judgment by default are:
(i)
that the party seeking relief must
present a reasonable and acceptable explanation for his default; and
(ii)
that on the merits such party has a
bona fide
defence
which,
prima facie
,
carries some prospect of success …
It
is not sufficient if only one of these two requirements is met; for
obvious reasons a party showing no prospect of success on
the merits
will fail in an application for rescission of a default judgment
against him, no matter how reasonable and convincing
the explanation
of his default
. And ordered
judicial process would be negated if, on the other hand, a party who
could offer no explanation of his default other
than his disdain of
the Rules was nevertheless permitted to have a judgment against him
rescinded on the ground that he had reasonable
prospects of success
on the merits.
”
[emphasis added]
[33]
In
2003, in
Colyn
v Tiger Foods
,
the Supreme Court of Appeal (per Jones AJA) said this:
[15]
“
I
turn now to the relief under the common law. In order to succeed an
applicant for rescission of a judgment taken against him by
default
must show good cause (
De Wet and others
v Western Bank Ltd supra
). The
authorities emphasize that it is unwise to give a precise meaning to
the term good cause. As Smalberger J put it in
HDS
Construction (Pty) Ltd v Wait
:
‘
When
dealing with words such as “good cause” and “sufficient
cause” in other Rules and enactments the Appellate
Division has
refrained from attempting an exhaustive definition of their meaning
in order not to abridge or fetter in any way the
wide discretion
implied by these words (
Cairns’
Executors
v
Gaarn
1912 AD 181
at 186;
Silber
v
Ozen Wholesalers (Pty) Ltd
1954 (2) SA 345
(A) at 352–3). The Court’s discretion
must be exercised after a proper consideration of all the relevant
circumstances.’
With
that as the underlying approach the courts generally expect an
applicant to show good cause (a) by giving a reasonable explanation
of his default; (b) by showing that his application is made
bona
fide
; and (c) by showing that he
has a
bona
fide
defence to the plaintiff’s
claim which
prima facie
has
some prospect of success
(
Grant
v Plumbers (Pty) Ltd
,
HDS Construction (Pty) Ltd v Wait
supra
,
Chetty
v Law Society, Transvaal
.)
”
[emphasis added]
[34]
Accordingly, while the Supreme Court of
Appeal in
Colyn v Tiger Foods
rests its statement of the law partially upon the authority of
Chetty
, it
unsettles the apparently firm position in that decision, underlined
in the quotation above, which came close to doing exactly
that
against which Innes JA had cautioned in 1912, namely of abridging the
wide discretion of the court. In the wake of
Colyn
v Tiger Foods
, the correct position is
that the court’s discretion is wide and that it will generally
expect that, in endeavouring to show
good cause, an applicant will
give a reasonable explanation of default, show that the application
is made
bona fide
and that it has a
bona fide
defence to the plaintiff’s claim that
prima
facie
has some prospect of success. It
is not necessary for the applicant to demonstrate both of the
Chetty
legs, on pain of dismissal of the application if both are not
satisfied. Rather, it should try to make out a case under each of
the
three rubrics in
Colyn v Tiger Foods
.
While it would be a peculiar case where an applicant for rescission
succeeds without, for example, giving a proper explanation
for
default, it is at least theoretically possible.
[35]
In sum, then, to prevail in an application
under rule 31(2)(b), an applicant must show that the application was
brought within 20
days of its gaining knowledge of the judgment.
Next, it must show good cause. To prevail at common law, the
applicant must only
show good cause.
Debt or liquidated
demand
[36]
As
was the case in
Ellis
v Eden; Eden v Ellis
,
[16]
heard in the Western Cape High Court, I was not addressed on whether
the claim in the action was one for a “
debt
or liquidated demand
”.
At first blush, this affects whether the relief is cognisable under
rule 31(2)(b) or only at common law. In the action,
the respondent
indeed claimed a debt or liquidated demand. With the particulars of
claim was enclosed a certificate of balance
dated 9 June 2022.
[37]
In
Ellis
v Eden
,
the court observed:
[17]
“
The
cases are not harmonious as to whether, in the case of a claim for a
debt or liquidated demand, a plaintiff may seek default
judgment from
the Court rather than the registrar. In this Division, it was held
in
Snyders
that
rule 31 in its current form does not remove the Court’s
jurisdiction to grant default judgment in such cases, and
in my
experience this is often done.
”
[38]
The
court continued:
[18]
“
The
learned authors of
Erasmus
Superior Court Practice
submit that
if a Court, rather than the registrar, grants default judgment on a
claim for a debt or liquidated demand, neither rule
31(2)(b) nor rule
31(5)(d) applies, and that a defendant must seek rescission in terms
of the common law or rule 42(1
).
In
my opinion, however, there is no rational basis for excluding such a
case from the scope of rule 31. The relevant parts
of the rule were
no doubt drafted on the assumption that, in the case of a debt or
liquidated demand, the plaintiff would follow
the less expensive
procedure laid down in rule 31(5). But where, on such a claim,
default judgment is instead granted by the Court,
there is no reason
to deprive a defendant of the benefit of rule 31(2)(b) and,
conversely, there is no reason why such a defendant
should not be
bound by the 20-day time limit specified in rules 31(2)(b), as would
have been the position in terms of 31(5)(d)
had the default judgment
been granted by the registrar. Reading rule 31 purposively, I
consider it to be necessarily implied that
rule 31(2)(b) applies
where, for any reason, the Court rather than the registrar has
granted default judgment on a claim for a
debt or liquidated demand
.”
[39]
I agree with this exposition. The fact that
this is a claim for a debt or a liquidated amount, but the court
granted default judgment
in an application under rule 31(5)(a),
should not deprive an applicant of access to the machinery of rule
31(2)(b).
[40]
The applicant says that it became aware of
the judgment on 8 March 2023, when its attorney advised it that
default judgment had
been obtained on 22 October 2022. This
application was delivered on 3 April 2023, within the 20-day window.
In the answering affidavit,
the respondent does not contest this.
[41]
Accordingly, both as far as rule 31(2)(b)
and the common law go, this application turns on whether the
applicant has shown good
cause in the sense described above.
[42]
In the debate between the parties over good
cause, two questions predominated, namely whether there was a proper
explanation for
the applicant’s default – which centred
upon the facts surrounding service of the summons – and whether
the applicant
had put up a
bona fide
defence with at least
prima facie
prospects of success. At various junctures, the respondent also
directed at the applicant aspersions of a lack of general
bona
fides
.
[43]
To determine the question of good cause, I
turn to consider the arguments mounted over the service of the
summons and the defence
that the applicant has described.
SERVICE
The purpose of service
[44]
It
is a fundamental principle of our legal system that someone is
entitled to get notice of legal proceedings against them.
The
purpose of a summons or a notice of motion is to implicate or involve
a defendant or respondent in a suit. Although an action
is commenced
when summons is issued, the defendant is not involved until there has
been service. It is only then that a formal
claim is made upon it.
Only once service has been effected of the summons or notice of
motion, is the defendant or respondent implicated.
[19]
[45]
Rule 4(1)(a) provides that service of any
process of the court directed to the sheriff “
shall
be effected by the sheriff in one or other of the following manners
”.
Across paragraphs (i) to (ix) follows a list of modes of service,
each of which is framed in the alternative to the others
(and some of
which are specific to certain types of defendants).
[46]
Rule 4(1)(a)(iv) says that, if the person
to be served has chosen a
domicilium
citandi et executandi
, the sheriff
might effect service “
by
delivering or leaving a copy
” of
the document at that chosen
domicilium
.
[47]
In turn, rule 4(1)(a)(v) provides that, for
a corporation or company, the sheriff might deliver “
a
copy [of the document] to a responsible employee thereof at its
registered office or its principal place of business within the
court’s jurisdiction, or if there be no such employee willing
to accept service, by affixing a copy to the main door of such
office
or place of business, or in any manner provided by law …
”.
[48]
Upon a survey of the cases, a tension
appears between two opposing goals. On the one hand, there is the
understanding that the notion
of service denotes a document being
“
legally delivered
”.
In other words, as long as service has been effected in compliance
with one of rules 4(1)(a)(i) to (ix), that should suffice.
The
drafters of the Uniform Rules considered that each of those would be
effective service. On the other hand, over and above compliance
with
one of the above subparagraphs of rule 4(1)(a), there is an
overriding concern that service should be effective. In other
words,
the defendant or respondent should obtain actual notice.
[49]
So,
for instance, in the context of service at a
domicilium
address, in
Amcoal
Collieries Ltd v Truter
,
[20]
the court held:
[21]
“
It
is a well-established practice … that, if a defendant has
chosen a
domicilium citandi
,
service of process at such place will be good, even though it be a
vacant piece of ground, or the defendant is known to be resident
abroad, or has abandoned the property, or cannot be found
.
”
[50]
Amcoal
Collieries
was
referred to in
Absa
Bank Limited v Mare and Others
,
[22]
in which this court observed thus:
[23]
“
The
delivery requirement at a
domicilium
citandi
, as was said by Margo J in
Loryan (Pty) Ltd v Solarsh Tea and
Coffee (Pty) Ltd
1984 (3) SA 834
(W) at
849A–B,
‘…
presupposes delivery in any manner by which in the ordinary course
the notice would come to the attention of and
be received by the
lessor. The obvious method would be by handing the notice to a
responsible employee, or by pushing it under
the front door, or by
placing it in the mailbox.’”
[51]
The question of effective service will
always be a contextual and fact-specific one, tested against the
principle that defendants
and respondents are implicated only once
they have been served and thus have notice.
The parties’
contentions on service
[52]
The applicant assails the service effected
at the post box in Royldene. Its main complaints over service fall
under three heads.
I deal with those first.
[53]
First, the applicant says that in the lease
agreement the parties chose a
domicilium
citandi et executandi
for the
applicant. Accordingly, the respondent was obliged to use that
address. Second, it argues that, since there was no employee
at its
registered address, service of the summons there was not effective
service. Third, the applicant contends that the respondent
ought to
have effected service upon the attorneys representing it.
Domicilium citandi
et executandi
[54]
In the
locatio
conductio
, the parties chose a
domicilium
address for the applicant.
Clauses 68–70
of the respondent’s terms and conditions read:
“
The
Hirer chooses the address of the Site and the email address and
facsimile number set out in the quotation and tax invoice as
its
addresses or facsimile number at which all notice, legal processes
and other communications must be delivered for the purpose
of this
agreement.
The Hirer may by
written notice to Alf’s Tippers CC change its chosen address to
another physical or email address or
change its facsimile
number, provided that the change shall become effective on receipt of
the notice by Alf’s Tippers CC.
Any
notice to the Hirer (a) delivered by hand to a responsible person
during ordinary business hours at its chosen address;
or (b)
faxed to its chosen facsimile number; or (c) mailed electronically
shall be deemed to have been received in the case of
delivery by
hand, faxing or emailing, on the day of delivery, faxing or emailing
thereof.
”
[55]
Accordingly, the
locatio
conductio
came about a bit like a
contract of adhesion might have done: that the site is the
applicant’s
domicilium
address appears among the respondent’s pre-printed terms and
conditions. Yet, clause 69, quoted above, provides that, had
the
applicant been dissatisfied with that arrangement, it could have
changed its
domicilium
address by written notice. It did not exercise its right under clause
69, and the pre-printed
domicilium
address remained in place.
[56]
The question then arises as to the meaning
and effect of that agreement: whether it obliged the parties to use
the
domicilium
address to the exclusion of other modes of service provided for in
rule 4. Certainly, clause 68 is framed in peremptory language:
“
at
which all notice, legal processes and other communications must be
delivered for the purpose of this agreement
”.
[57]
In the light of how the agreement came
about, and the terms of clause 68, it is surprising that in the
answering affidavit the respondent
goes as far as to say this: “
It
would not make any sense for the respondent to serve summons at
the site, given that the applicant’s registered address
is
in Kimberley and address of its principal place of business in
Bedfordview, a distance of 900km and 1300km from Vioolsdrift,
respectively.
” One wonders why a
contracting party would propose and agree to a
domicilium
address for the other party – indeed have it printed among its
terms and conditions, for general use – if it was minded
that
the use as such of that address (at a mining site) “
would
not make any sense
”.
[58]
Be that as it may, the respondent sets out
no facts, other than the distance between the site and the
applicant’s registered
office and principal place of business,
respectively, to bear out its contention that service at the site
“
would not make any sense
”.
Accordingly, I cannot find that, because service at the site was an
impossibility, the respondent was for that specific
reason permitted,
despite clause 68, to use one of the other modes of service provided
for in rule 4(1). That would have been an
easy way out of the
quandary.
[59]
Yet, accepting that – contrary to the
respondent’s suggestion – effective service could be
made at the site,
the question is whether the respondent might
nevertheless have elected to serve at the registered office of the
applicant.
[60]
The
applicant relied on the decision of this court in
Sandton
Square Finance (Pty) Ltd and others v Biagi, Bertola and Vasco and
another
,
[24]
which held:
[25]
“
The
mere fact that a domiciliary address has been chosen does not
preclude effective service through one of the other methods
prescribed
under the Uniform Rules of Court
.”
This
dictum
,
it contended, was approved of and elaborated upon in
Motloung
v Meyersdal Nature Estate Homeowners Association
,
[26]
where this court held that “
the
choice of a
domicilium
address
by a defendant does not preclude or prevent a plaintiff from invoking
an alternate method provided for in terms of Rule
4, if use of such
alternate method is necessary in order to achieve effective service
on the defendant
”.
[27]
[61]
Neither
of those judgments quotes the words in which the
domicilium
clauses in question were couched. Accordingly, it is not clear
whether they were only permissively framed, or peremptorily, as
here.
[28]
[62]
At first blush it appears that
Motlaung
might indeed go further than
Sandton Square
,
by holding that service should in the first place be effected at the
domicilium
address and, only if it is “
necessary
”
to achieve effective service, might another mode of service under
rule 4(1)(a) be used. This is how the applicant construed
Motloung
,
namely as holding that “
necessity
”
was indeed a requirement for service in another way where there is a
domicilium
address.
[63]
The question, then, is whether service that
was effected by affixing at the registered office of the applicant
could be valid service
or whether it was precluded by clause 68 of
the respondent’s standard terms and conditions.
[64]
In my view, the answer resides in the
following considerations.
[65]
I might first say that, had the
Motloung
court intended thus to hem in the broader statement of the law in
Sandton Square
,
it would have done so explicitly. The
dicta
in paragraphs 17, 18 and 25 of
Motloung
can be read consistently with
Sandton Square
,
namely that the choice of a
domicilium
clause does not preclude the use of one of the other modes of service
in rule 4(1)(a). Naturally, whenever service is at issue,
its
effectiveness is paramount. The applicant’s position, allowing
the use of another mode of service in the presence of
a
domicilium
address only if it is necessary for effective service, would make the
sheriff, more than they already are, the unhappy arbiter
of
effectiveness, which would likely lead to a spate of disputes.
[66]
What
is more, in applying the principles in
Natal
Joint Pension Fund v Endumeni Municipality
[29]
to discern the meaning of the
domicilium
clause in the
locatio
conductio
,
it must be understood in its proper context, part of which is rule
4(1)(a), against the background of which it necessarily functions.
[67]
The drafters of the rules chose to frame
rule 4(1)(a) thus: “
Service of any
process of the court directed to the sheriff and … any
document initiating proceedings
shall
be effected by the sheriff in one or other of the following manners
…
”
[emphasis added]
[68]
The general tenor of the language is
peremptory. The sheriff must use one or other of the methods set out
in rule 4(1)(a). But that
is hardly determinative of this question.
As I observe above, rule 4(1)(a)(iv) provides that service at a
chosen
domicilium
address is one of “
the following
manners
”. The drafters of the
rules constructed rule 4(1)(a) to facilitate effective service on a
defendant or respondent. The various
alternative modes of service,
some applicable only to specific cases, were set in place so that the
likelihood of effective service
on a defendant was increased.
[69]
S
ection
23(3) of the
Companies
Act, 2008
, provides that each company must continuously maintain
at least one office in South Africa, and register the address of that
office
(or of the principal office, if there are more than one) by
providing that information on its notice of incorporation.
[70]
Accordingly,
it is plain that a company’s registered office is important.
Each company must have one. A company will apply
its juristic mind to
the question of what an appropriate and effective registered office
would be for it. Service should be expected
to be routine at that
address. It is perhaps not fanciful to say that, in the light of the
importance thus accorded to it by statute,
that address is something
like a statutorily mandated
domicilium
address. In other words, while a company might for whatever reason
choose a specific
domicilium
address in a contract, as a matter of law it must always have a
registered office that it has chosen. In
Malvern
Trading CC v Absa Bank Ltd
,
[30]
this court observed:
[31]
“
The
rationale behind a registered address is indeed that third parties
can with ease communicate with a company or corporation or
serve
process at the registered address. This is in the context of the fact
that it is often difficult for an outsider to determine
the locality
of a company or close corporation’s principal place of
business.
”
Indeed, not surprisingly,
rule 4(1)(a)(v)
provides that, in the case
of a company, the sheriff might effect service at its registered
office.
[71]
The peculiarity of the facts of this case
then come into focus. The applicant had no role in the choice of the
domicilium
address. While it was entitled to change its
domicilium
address from the site stipulated in the respondent’s standard
terms and conditions, as a matter of practical reality this
was
highly unlikely ever to happen. Having received the standard terms
and conditions, the applicant probably gave not a second
thought to
the
domicilium
address effectively foisted upon it.
[72]
Accordingly, on these facts, where the site
as
domicilium
address was something of the respondent’s choosing, I cannot
see how – even if it is as peremptorily worded as here
–
a
domicilium
clause might be construed as excluding the entitlement of the sheriff
to serve in another way, especially not under
rule 4(1)(a)(v)
,
which hinges upon a company’s statutorily ordained registered
office.
[73]
Accordingly, I find that this
domicilium
clause, however peremptorily worded, does not exclude the power of
the sheriff to serve under one of the other subparagraphs of
section
4(1)(a).
[74]
I leave open the question whether there
might be
domicilium
clauses, worded differently, having that effect.
What
rule 4(1)(a)(v)
permits
[75]
The
applicant’s second complaint over service is this. The decision
of the Eastern Cape Division in
Magricor
(Pty) Ltd v Border Seed Distributors CC
[32]
precludes service under
rule 4(1)(a)(v)
at a registered address when
no-one – be it an employee of the defendant or anyone else –
is present at that address.
Accordingly, for this reason, the
respondent could not permissibly affix the summons to the post box at
the applicant’s registered
office (nor indeed to its main
door).
[76]
The
core of the reasoning of the
Magricor
court is this passage:
[33]
“
[T]he
jurisdictional requirements for service by the sheriff by affixing a
copy of process to the main door of a company’s
registered
office or principal place of business in the court’s
jurisdiction, are (a) that a responsible employee of the
company must
be present at such office or place of business; and (b) that such
employee must be unwilling to accept service.
If
there is an employee willing to accept service on behalf of the
company, there would have been good and valid service upon the
company. Where not a single employee amongst those present is willing
to accept service on behalf of the company, there would be
good and
valid service upon the company if the sheriff were to affix the
process to the main door of a company’s registered
office or
principal place of business. I respectfully align myself with the
view of Hartzenberg J when he had the following to
say in this regard
in
Chris
Mulder Genote Ing v Louis Meintjies Konstruksie (Edms) Bpk:
[34]
‘
Indien
die kwessie van betekening van die dokument later ‘n twispunt
sou word sou dit vir litigante van groter hulp wees om
te weet dat
meneer X of mejuffrou Y die dokument ontvang het as bloot om te weet
dat dit teen ‘n deur opgeplak was. Daar
moet derhalwe by ‘n
geregistreerde adres nagegaan word of daar werknemers is van die
besigheid wat daar bedryf word. As daardie
dan die geregistreerde
adres van die maatskappy is aan wie betekening moet geskied moet ‘n
verantwoordelike werknemer opgespoor
word en indien so ‘n
werknemer bereid is om betekening namens die maatskappy te aanvaar
moet aan daardie persoon beteken
word. Dit is denkbaar dat die
werknemers by so ‘n adres om een of ander rede nie bereid mag
wees om betekening namens die
maatskappy te aanvaar nie. Dan mag
betekening geskied deur die dokument teen die deur vas te plak soos
wat subreël (v) van
Hofreël 4(1)(a) die adjunk-balju
toelaat.’
The
purpose of
rule 4(1)(a)(v)
is to ensure that the process served by
the sheriff comes to the attention of the juristic entity. It is for
that reason that the
subrule prefers service on an employee of the
company. The subrule makes provision for two scenarios of service on
a company. The
first is ‘by delivering a copy to a responsible
employee’. Such an employee would obviously be willing to
accept service.
The second scenario is when the sheriff finds an
employee or employees of the company at the company’s
registered address
but not a single one is willing to accept service
on behalf of the company. Only then does the subrule authorise
service ‘by
affixing a copy to the main door’. It will be
noticed that in both scenarios there would have been personal
interaction between
the sheriff and the employee to whom the process
was delivered, on the one hand, and the sheriff and the employee who
was unwilling
to accept such service, on the other hand. In the first
case the employee would bring the process to the company’s
attention.
In the second case, the sheriff’s return of service
would reflect that he spoke to employee X who was unwilling to accept
service. In both cases the employees, the employee who accepted
service and the one who was unwilling to accept service, would
be of
great assistance, through his willingness or, ironically,
unwillingness, to prove service in terms of the subrule
.”
[77]
The
respondent’s position is that
Magricor
was wrongly decided. Of course, it bears emphasis that
this
court is not bound by that ruling.
Indeed,
in
Malvern
Trading CC
,
without considering the contrary authority in
Magricor
and without explaining its own reasoning, this court accepted that
rule 4(1)(a)(v)
has a different meaning:
[35]
“
The
return of service in this matter reveals that the notice of motion
was served at the registered address of the applicant, by
affixing it
to the principal door, as no other manner of service was possible. It
was recorded by the sheriff that the premises
were vacant. There was
obviously no employee of the applicant present who could accept
service.
Consequently,
valid service was effected in terms of
Rule 4(1(a)(v).
”
[78]
What
is more, the facts in
Chris
Mulder
,
[36]
upon which the
Magricor
court relied, were rather different. An order for provisional
liquidation stipulated that it had to be served on the respondent
company at its registered office, which was at the office of a large
auditing firm. The sheriff’s return said that, since,
after a
“
ywerige
”
search, no responsible person had been found, the order was affixed
to the main door of the office. Upon enquiry by the
Judge, it
transpired that the practice of this particular sheriff’s
office was that, where service was effected at the office
of a firm
of professionals like auditors or attorneys, and no partner was
present, it would be accepted that there was no responsible
person
for purposes of service. The receptionist had taken the sheriff to
the board indicating that it was the registered office
of the
company, whereupon he affixed the order to the main door. The
receptionist promptly removed it, acting as if it had been
served
upon her.
[79]
This
is the context of the quotation from
Chris
Mulder
in
Magricor
.
Indeed, the extract above from
Chris
Mulder
is preceded by this statement:
[37]
“
Dit
lyk vir my in ieder geval uit ‘n praktiese oogpunt baie meer
logies om wanneer betekening by ‘n ouditeursfirma,
of dergelike
firma, geskied, ‘n afskrif van die dokument te oorhandig aan ‘n
persoon wat hom of haarself identifiseer
en wat betekening aanvaar
eerder as om bloot die dokument teen ‘n deur vas te plak.
”
[80]
Accordingly, in
Chris
Mulder
there were indeed other persons
present at the registered office in question. Yet, since there was no
partner in the auditing firm
present, the sheriff chose to affix the
order to the front door, ignoring the non-partner employees at that
time present at the
firm. Accordingly, the
dictum
from
Chris Mulder
quoted in
Magricor
and recited above does not speak to the case where no-one is present
at the registered office.
[81]
In
Magricor
,
the court went on to observe:
[38]
“
What
about the situation where the company is locked and there are no
employees or other persons at its
registered
office? In my view
the subrule does not make provision for that scenario. That
scenario will obtain if the word ‘willing’
is deleted
from the subrule. Without that word the subrule would mean that
service may be effected by the sheriff by affixing
a copy of the
process to the main door ‘if there be no [responsible] employee
to accept service’. In other words,
affixing would then
have been permitted in the absence of responsible employees. But
the drafters of the subrule insisted
on the insertion of the word
‘willing’ which, in my view, relates to the personal
interaction dealt with above. The
fact that the subrule does not
cater for the service of process on a company where its employees are
absent to accept service,
is a
lacuna
best dealt
with by the drafters of the rules.
In
my view, the absence of employees of a company from the registered
office or principal place of business does not permit the
sheriff to
effect service by affixing the process to the company’s main
door at its registered office or principal place
of business. For
that kind of service to be effected the employees of the company must
be unwilling to accept service.
”
[82]
Thus, the
Magricor
court’s reasoning turns upon the drafters’ insertion in
rule 4(1)(a)(v)
of the adjective “
willing
”
after the noun “
employee
”.
However, there is another way of reading the condition “
if
there be no such employee willing to accept service
”,
namely encompassing both where there is an employee but she refuses
to accept service (surely a rare occurrence) and where
there is no
employee whatsoever. In the latter case, it does no violence to the
language nor, in my view, to the logic of
rule 4(1)(a)(v)
to say that
there is also no employee willing to accept service. In other words,
the condition “
if there be no such
employee willing to accept service
”
can quite easily be read to include both where there are unwilling
employees and no employees at all. In my view, if the
drafters of the
rules had meant to insert this condition, they would have done so
clearly and explicitly.
[83]
The
Magricor
court concedes that its reasoning leads to a
lacuna
.
The Latin maxim
ut
res magis valeat quam pereat
encapsulates the canon of construction that it is preferable to give
effect to a provision rather than having it fail. It is applied
when
alternative readings are possible, one of which would achieve the
manifest purpose of the provision and one of which would
reduce it to
futility or absurdity. The interpreter is enjoined to choose the one
that gives effect to the purpose of the provision.
[39]
By parity of reasoning, the alternative construction of
rule
4(1)(a)(v)
, set out in the previous paragraph, is in accord with this
canon of construction.
[84]
For these reasons, I respectfully disagree
with the reasoning in
Magricor
.
In my view,
rule 4(1)(a)(v)
permits service by affixing at the main
door of a registered office where, as in
Malvern
Trading
, there is no-one to be found at
that office.
Attorneys of record
[85]
In the third place, the applicant contends
that, from at least 2 June 2022, twenty-four days before the summons
was issued, the
respondent and its attorneys of record knew who the
applicant’s attorney was, when the latter answered the demand
under
section 345(1)(a)
of the
Companies Act. In
that letter, it said
that those attorneys “
have
instructions to oppose any legal action that your client intends to
take against our client
”.
[86]
Accordingly, the applicant asks
rhetorically why the respondent “
persisted
with service on the registered address full well knowing the identity
and contact details of Hamze’s attorney of
record
”.
[87]
Rule 4(1)(a)(aA)
provides:
“
Where
the person to be served with any document initiating application
proceedings is already represented by an attorney of record,
such
document may be served upon such attorney by the party initiating
such proceedings
.”
[88]
Yet, service under
rule 4(1)(a)(aA)
might
be effected only if a party is represented by an attorney who had
formally placed themselves on record as representing that
party in
proceedings already instituted.
[89]
In
ABM
Motors v Minister of Minerals and Energy and others
,
[40]
the court observed:
[41]
“
Secondly,
this is not what ‘attorney of record’ means in the
context of
rule 4(1)(aA).
In the context of the Uniform Rules of
Court, an attorney of record is one who has formally placed himself
on record as representing
a party in legal proceedings before the
court. In
BHP Billiton Energy Coal
South Africa Ltd v Minister of Mineral Resources and Others
,
the court said, with reference to
Herbstein
& Van Winsen
, that it is apparent
that rule 4(1)(aA) applies to proceedings already instituted, so that
it in effect applies to ancillary and
interlocutory applications.
”
[90]
Accordingly, there is no substance to the
applicant’s complaint in this regard.
[91]
Indeed, rule 4(1)(a)(aA) could not
permissibly have been used here.
Other complaints over
service
[92]
The applicant also raises these complaints
over service.
[93]
First, it says that the sheriff’s
return of service states that service was effected under rule
4(1)(a)(iv), namely at the
applicant’s
domicilium
address, whereas it was, of course, actually effected at the
applicant’s registered office, at Royldene in Kimberley.
[94]
“
The service
”
the applicant proceeds to say, “
was
therefore in terms of Rule 4(1)(a)(v) and not Rule 4(1)(a)(iv) as
stated by the sheriff and therefore already defective and
misleading
as it presented to the court that this was the address chosen by the
parties, which it was not
”.
[95]
The respondent correctly observes that,
while the incorrect subparagraph of rule 4(1)(a) was indeed cited,
both returns go on to
say that it was the “
registered
address
” of the applicant.
[96]
While a return ought naturally to be as
accurate as possible, the reality is that many are far from epitomes
of precise drafting.
A court should be wary of exacting too high a
standard, especially where here, despite the error, there could not
have been any
confusion.
[97]
The
sheriff made an error. There is no factual basis for the applicant’s
speculative suggestion that the attorney of the respondent
had
instructed him “
to
serve under the incorrect subparagraph …
”
[42]
[98]
The applicant also complains that the
sheriff’s returns did not contain the statement that he had
verified the registered
address of the applicant by way of a board
present there. The applicant refers to paragraph 9.19.3 of the
practice manual of January
2017. The respondent says that that manual
had been overtaken by two others. Yet, the requirement that the
sheriff make a statement
to the above effect is qualified by a
requirement that, in the absence of such a statement in the return,
the registered address
“
must be
proved by filing in the court file an official document proving the
registered address
”. In the
default application, the respondent did just that, under oath.
[99]
There is no merit in these arguments.
Effective service
[100]
Accepting, then, that service could be
effected at the registered office of the applicant, in the face both
of the
domicilium
clause in the writing recording the
locatio
conductio
and the fact that there were
no employees of the applicant present there, whether willing to
accept service or otherwise, the question
arises whether the service
in question was effective.
[101]
In both returns, the sheriff says that,
having made a diligent search, he decided that there was no other
means of effecting service
and he then indeed effected service by
affixing the document to the post box of the unit of the applicant.
[102]
Surprisingly, it is hard to find
authorities that speak to facts like these. Two judgments that are
tangentially instructive are
these.
[103]
In
BJB
Project Services v Reatlegile Projects
CC,
[43]
this court held:
[44]
“
[Affixing
to the main door] cannot be construed to mean by sticking the process
under the principal door, although this would have
readily come to
the applicant’s attention. However, I am concerned by the
averment that the intercom was not working. If
this is the case, the
process could only have been affixed to the outer perimeter gate,
which would not have been sufficient.
”
[104]
In
Mathome
Training Development (Pty) Ltd v Finsch Diamond Mine Training Centre
& One
,
[45]
the Northern Cape Division, in Kimberley, observed:
[46]
“
The
difficulty encountered in this matter is that though Rule
14(1)(a)(iv) allows for service at a chosen
domicilium
citandi
, the defendants chose a Post
Office Box as their
domicilium
.
…
In casu
, and having
chosen a Post Office box as
domicilium
, it is difficult to
imagine a situation where the sheriff would be able to hand over the
process to a person at the
domicilium
, neither slipping it
under the front door nor affixing it thereto. The sheriff, literally
interpreting the Rule, delivered a copy
of the summons at the chosen
domicilium
by affixing it to the postbox. Had this been the
only form of service, it would most likely be found not to be good
service in terms
of the Rule in light of the
Mare
judgment.
However the sheriff went further and sent the summons by registered
mail to the chosen
domicilium
.
”
[105]
The approach in both those decisions is a
conservative one, requiring a significant measure of fidelity to the
words in which rules
4(1)(a)(iv) and (v) are cast.
[106]
Perhaps
nearer the other end of the continuum is
Arendsnes
Sweefspoor CC v Botha
.
[47]
There,
the sheriff attempted service on the registered address of the
defendant only to be told that the defendant had ceased trading
at
the premises. All that remained on the site was a restaurant operated
by the son-in-law of the defendant’s sole member.
Upon ceasing
trading, the defendant had failed to deregister the company.
Accordingly, its registered office was still at the premises.
The
sheriff served the summons on an employee of the restaurant, who
failed to give the summons to the defendant. The defendant’s
contention was that, since he had received a copy of the summons
neither from the sheriff, nor from Mr Pretorius, the employee
in
question, the summons had not been properly served.
The
Supreme Court of Appeal held that this form of service constituted
substantial compliance with rule 4(1)(a)(v).
[107]
Nevertheless,
Arendsnes
points to the danger of service on a person unrelated to the
defendant. There, the summons did not reach the defendant.
[108]
In the light of these decisions, I say
this. It is unfortunate that the applicant chose a registered office
that it must have known
would make service under rule 4(1)(a)(v) very
difficult if not impossible. Yet, it is not this court’s role
to punish the
applicant for that decision.
[109]
Contrariwise, it is also unfortunate that
the sheriff did no more than affix the summons and the notice of
set-down to the post
box in question. I have no idea what means he
used to do the affixing. While the photograph of the entrance to the
complex in Royldene
indeed indicates a degree of enclosure,
photographs can be deceptive. I have no way of knowing whether at
times the entrance becomes
a wind tunnel in which documents, however
sturdily affixed, might be swept away. While the sheriff says that
there was no other
means of effecting service, had he done more, by
also depositing a copy in the post box itself or by handing it to a
security guard
at the entrance of the complex – the latter in
pursuance of
Arendsnes
– I might have been more sanguine on the effectiveness of the
service.
[110]
It also must not be forgotten that the
respondent had various other means at its disposal of reaching the
applicant. Upon receiving
the return from the sheriff, it might well
have adopted a more cautious approach by ensuring that it also used
other means to bring
the summons and the notice of set-down to the
attention of the applicant.
[111]
In sum, for all these reasons, I do not
consider the service that was effected at the post box to the unit in
question to have been
effective service under rule 4(1)(a)(v). It was
not in compliance with the subrule, which, where there is no employee
present,
allows affixing to the main door of the applicant.
[112]
While the sheriff asserts that no other
means of service was possible, it is my considered view that more
might have been done to
achieve effective service under rule 4(1)(a).
Bona
fide
defence
[113]
The
applicant relies upon the decision of the Supreme Court of Appeal in
EH Hassim
Hardware (Pty) Ltd v Fab Tanks CC
[48]
as far as the requirement goes that an applicant set out its
bona
fide
defence for purposes of rescission:
[49]
“
It
is trite law that an applicant in an application for rescission of
judgment need only make out a
prima
facie
defence
in the sense of setting out averments which, if established at trial,
would entitle her or him to the relief asked for.
Such an applicant
need not deal fully with the merits of the case and produce evidence
that shows that the probabilities are in
its favour. That is the
business of the trial court. T
he
object of rescinding a judgment is to restore the opportunity for a
real dispute to be ventilated.
”
[114]
The
Supreme Court of Appeal added:
[50]
“
[F]or
the appellant to be successful in its application for rescission of
judgment, it needs to set out averments which, if established
at
trial, would entitle it to the relief asked for. It need not deal
fully with the merits of the case and produce evidence that
shows
that the probabilities are actually in its favour.
”
[115]
As I observe above, the applicant’s
papers are wafer thin. The founding affidavit comprises 35 paragraphs
over nine pages.
The replying affidavit has 28 paragraphs over five
pages. The lion’s share of the averments in both are devoted to
the question
of service.
What the applicant
says its
bona fide
defence is
[116]
As to its
bona
fide
defence, under the heading
“DEFENCE” in the founding affidavit the applicant says
only this:
“
Hamze
kept record of the hours that the trucks were working at the
Vioolsdrift site. Alf’s provided three trucks with serious
mechanical problems, in terms of the agreement. The three trucks
couldn’t work due to the mechanical defects, which were
not the
responsibility of Hamze. This allegation will be proven by the
leading of evidence from the employees at the Vioolsdrift
site.
The
essence of Hamze’s defence is that the quantum calculated by
Alf’s is incorrect and disputed. Alf’s charged
Hamze for
at least three trucks, which couldn’t perform services due to
mechanical problems.
”
[117]
In the earlier part of the founding
affidavit, in which the applicant’s deponent sets out what he
calls the background, he
says that “
[d]uring
the period January to March 2022, Hamze raised concerns in relation
to the agreement
”, which included
“
continuous poor performance of
the trucks, which were already mechanically faulty when they arrived
at the mining site, causing
delays
”,
and “
incorrect billing, resulting
in the applicant being overcharged for hours worked by drivers when
no work was performed
”.
[118]
He adds that a “
dispute
arose between the applicant and respondent regarding billing hours
and poor performance of the trucks that were already
defective when
arriving on site pertinently trucks 120, 121 and 122
”.
[119]
These are broad and vague averments. The
applicant does not set out specific facts from which its defence
appears, as is required
of the applicant in this rubric of an
application for rescission.
[120]
Over and above this difficulty, there are
various other difficulties, too, with the account of the applicant’s
bona fide
defence, read, as it must be in the light of all the other facts it
sets out in its papers.
Factual inaccuracies
in the applicant’s account
[121]
The applicant’s account of the
contract and its implementation is riddled with puzzling errors.
[122]
While in its initial written form the
contract was for five tipper trucks, the applicant soon asked that
five more be dispatched.
Accordingly, construed in totality, the
contract was for ten tipper trucks. Yet, the applicant’s
version on oath is to the
effect that only five tipper trucks were
dispatched to its site. It states it in two places in the founding
affidavit. This is
obviously wrong.
[123]
It is contradicted by
inter
alia
the e-mail message of the
applicant of 22 April 2022, once the contractual relationship between
the parties had already unravelled,
in which it sent a reconciliation
to the respondent, a copy of which is enclosed with the answering
affidavit, in which ten tippers,
each with an assigned number, are
listed.
[124]
Bizarrely, the answering affidavit having
clearly apprised the applicant of its factual error in this regard,
in the replying affidavit
the applicant’s deponent refrains
from addressing this, by acknowledging his earlier mistake and
offering some explanation
for it. He simply ignores it.
[125]
As I say above, the applicant also says
that “
[d]uring the period January
to March 2022, Hamze raised concerns
”
inter alia
with “
continuous poor performance
of the trucks
”. Yet, the e-mail
message to which I refer above that Ms Lourenco sent to Ms Horn on 7
February 2022 mentions how “
nicely
”
the first five tipper trucks were performing.
[126]
In paragraph 10 of the founding affidavit,
the applicant’s deponent says that the contract “
terminated
on or about due to the unresolved disputes
”
[
sic
],
apparently omitting the date. In the following sub-paragraph, he says
that the respondent recalled its trucks on 11 March 2022,
suggesting
that that is the date omitted just before. Yet, the truth of the
matter, borne out by contemporaneous documents, is
that the contract
was still being implemented in early April 2022. Enclosed with the
answering affidavit is a time sheet recording
work performed on 4 and
5 April 2022. It is signed off by Ms Zandramé Brits of the
applicant. It is consistent with the
respondent’s version in
the answering affidavit that it recalled its cohort of ten trucks
only on 6 April 2022.
[127]
Accordingly, the statement in the next
sub-paragraph is also falsified, namely that, after the date 11 March
2022, the respondent
“
refused to
engage
” with the applicant. The
contract was then still in train. Many engagements occurred.
[128]
Contrary to the terms of the
locatio
conductio
, the computation of 12 April
2022 that the applicant prepared, excluded VAT, which had to be added
to the quoted rate.
[129]
These are the most salient of the factual
inaccuracies in the applicant’s affidavits.
[130]
In sum, the version of the applicant is
riddled with demonstrable factual errors, which it did not correct in
reply. It is hard
to see how the applicant’s deponent could
have committed all those errors and blithely have stuck to that
version once the
answering affidavit showed them up.
[131]
In a sense, the applicant put up a largely
fictional account. This being so, it is hard for this court overall
to give credence
to its version.
Unexplained difficulty
in the applicant’s defence
[132]
The certificate of balance enclosed with
the particulars of claim lists various
quanta
corresponding with specific invoices that the respondent had provided
to the applicant. It is those amounts that total the amount
for which
default judgment was granted to the respondent.
[133]
The respondent says that the invoices were
created on the basis of weekly time sheets that were filled in by the
drivers in charge
of the various tipper trucks. A copy of five
examples of such time sheets was enclosed with the answering
affidavit. They reflect
the very process that the respondent
described. In each case, at the foot they bear the signature of a
supervisor.
[134]
While the applicant speaks of “
incorrect
billing, resulting in the applicant being overcharged for hours
worked by drivers when no work was performed
”
and while the applicant concedes that three of the second team of
five trucks experienced difficulties, the applicant sets
out no facts
to demonstrate precisely what its complaint is.
[135]
It does not say that drivers committed
fraud by filling out false time sheets, which served to pull the wool
over the supervisors’
eyes. In the context of the process of
time sheets being approved by the applicant’s supervisors and
those in turn being
used to generate the respondent’s invoices,
the applicant would need to make such an allegation supported by some
facts,
or provide another cogent explanation as to how this process,
in which it participated at its site, could have produced incorrect
invoices.
[136]
The applicant does not do so. It leaves the
court entirely in the dark.
Conclusion on
bona
fide
defence
[137]
For all these reasons, I cannot find that
the applicant has demonstrated that it has a
bona
fide
defence to the respondent’s
claim that
prima facie
has some prospect of success.
[138]
The facts here are markedly different to
those in
EH Hassim Hardware
, upon which the
applicant relied. There the court had the benefit of a clearly
delineated counter-claim that the applicant for
rescission was minded
to bring.
[139]
Here, despite my best efforts, I cannot see what the factual
basis of the applicant’s defence might be. Over and above its
broad, vague, and hard-to-fathom assertions of an overpayment, it
fails to plead the simple facts that would permit that conclusion.
[140]
That is what an applicant for rescission is enjoined to do.
DISCRETION
[141]
In the light of what I say above, I do not
consider that it would be a judicial exercise of my discretion to
grant the rescission
sought. The applicant has failed to plead the
facts that might underpin a cognisable
bona
fide
defence. What is more, in the
light of the remarkable way in which the applicant’s affidavits
have been drawn, it is not
possible to find that it has demonstrated
a
bona fide
intention to resist the respondent’s claim.
COSTS
[142]
The costs are to follow the result.
ORDER
1.
The application is dismissed.
2.
The applicant is to pay the costs of this
application, including the costs of counsel.
J J MEIRING
ACTING JUDGE OF THE
HIGH COURT
JOHANNESBURG
Date of hearing:
15 November 2023
Date of
judgment:
6 May 2024
APPEARANCES
For the
applicant:
Adv C Britz
Instructed
by:
Fredrick
Inc. Attorneys
For the
respondent: Adv C van
der Merwe
Instructed
by:
Warffemius
Van der Merwe Inc.
[1]
In
the notice of motion, the applicant says that the rescission is
sought under only rule 42(1)(a). The basis for the relief sought
ought not to appear in a prayer and it cannot affect the case made
out in the founding affidavit, and which formed the subject-matter
of argument. This proceeded on the bases for the relief sought
stated in para 6, namely rule 32(2)(b) or the common law.
[2]
Strictly,
this would mean that there were two contracts of
locatio
conductio
,
a
locatio
conductio rei
in respect of the tipper trucks and a
locatio
conductio operarum
in respect of the labour of the drivers.
## [3](127/2002)
[2003] ZASCA 36.
[3]
(127/2002)
[2003] ZASCA 36.
[4]
At
para 6.
[5]
1912
AD 181.
[6]
At
p 186.
[7]
1938
WLD 129.
[8]
At
p 136.
[9]
1949 (2) SA 470.
[10]
At
page 476.
[11]
1979
(2) SA 298 (E).
[12]
At
pp 300–301.
[13]
1985
(2) SA 756 (A).
[14]
At
p 765.
[15]
At
para 11.
[16]
10604/2020
[2022] ZAWCHC 143.
[17]
At
para 26.
[18]
At
para 27.
[19]
Republikeinse
Publikasies (Edms) Bpk v Afrikaanse Pers Publikasies (Edms) Bpk
1972
(1) SA 773
(A);
Marine
and Trade Insurance Co Ltd v Reddinger
1966 (2) SA 407
(A), at 413D.
[20]
1990 (1) SA 1 (AD).
[21]
A
t
5J–6D.
[22]
2021 (2) SA 151 (GP).
[23]
At
para 26.
[24]
1997
(1) SA 258 (W).
[25]
At
260C.
[26]
2021
JDR 2326 (GJ)
[27]
At
para 18.
[28]
In
Malvern
Trading CC v Absa Bank Ltd
,
this court considered whether the respondent was constrained to
serve the application at the applicant’s chosen
domicilium
.
Yet, the
domicilium
clause was framed permissively and not peremptorily. It held:
“
Assuming
that parties can by agreement limit the lawful methods of service,
the question is whether the agreement
in
casu
contains
such agreed limitation. The applicant, correctly, did not attempt to
develop its argument in this regard, as the relevant
clause in the
agreement clearly provided an option to the respondent to serve
process at the applicant’s chosen
domicilium
citandi
,
as opposed to an obligation.
”
The
Malvern
Trading
court correctly distinguished
Shepard
v Emmerich
,
which, as I read it, is authority for the proposition that, if one
uses a
domicilium
address for service and the
domicilium
clause has specific requirements (like delivery for the attention of
Mr X on the tenth floor), then those requirements must be
met.
[29]
2012
(4) SA 593 (SCA).
[30]
2024
(1) SA 478 (GJ).
[31]
At
para 17.
[32]
2021 JDR 0104 (ECG).
[33]
At paras 13–15.
[34]
My
translation of the Afrikaans passage following goes thus:
“
Should
the issue of service of the document later become the subject of a
dispute, it would be of greater benefit to litigants
to know that Mr
X or Ms Y received the document than simply to know that it was
pasted up against a door. Accordingly, at a registered
address an
enquiry should be made if there are employees present of the
business conducted there. If that is then the registered
address of
the company upon which service should be effected, a responsibile
employee should be found and if such an employee
is prepared to
accept service on behalf of the company, service should indeed be
effected on that person. It is conceivable that
the employees at
such an address might for some or other reason not be prepared to
accept service on behalf of the company. Then
service might be
effected by pasting the document to the door, as the sheriff is
permitted by subrule (v) of Uniform Rule 4(1)(a).
”
[35]
At
para 14.
[36]
1988
(2) SA 433 (T).
[37]
At
437G. My translation of this Afrikaans passage goes thus:
“
At
any rate, from a practical point of view, it seems to me to be far
more logical when service occurs at an auditors’,
or similar,
firm, to hand a copy of the document to a person that can identify
him- or herself and that can accept service than
simply top aste the
document to a door
.”
[38]
At
paras 18–19.
[39]
See
Amabhungane
Centre For Investigative Journalism NPC and Another v Minister of
Justice and Correctional Services and Others
2021 (3) SA 246
(CC), at para 77.
[40]
2018 (5) SA 540 (KZP).
[41]
At
para 26.
[42]
Cf.
by
parity: Piet Olivier “
Acting
in Reliance upon the Wrong Empowering Provision: Reconsidering the
Principle in
Harris
”
in
Constitutional
Court Review
,
2021, volume 11, at 483–501. In sum:
When
an administrator acts, they might choose to state the empowering
provision, or they might not. If they so choose, they might
err,
naming a provision that does not empower them to act as they did.
Whether this visits invalidity upon the act depends on
the
circumstances. If no law exists that empowers them so to act, their
decision is invalid. Yet, if they are empowered by a
provision other
than the one named, the validity of the act depends on whether they
invoked the incorrect provision inadvertently
or deliberately. If
the former, the act is not invalid. If the latter, the act is
invalid for that reason alone.
[43]
Case
No. 2017/01554 (unreported) No neutral citation could be found.
[44]
At
para 10.
[45]
[2022]
ZANCHC 8
(25 February 2022).
[46]
At
paras 13 and 16.
[47]
2013
(5) SA 399 (SCA).
[48]
(1129/2016)
[2017] ZASCA 145
(13 October 2017).
[49]
At
para 28.
[50]
At
para 17.
sino noindex
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