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REPUBLIC OF NAMIBIAHIGH COURT OF NAMIBIA MAIN DIVISION, WINDHOEKRULINGCase Title:NEDBANK NAMIBIA LIMITED andAVZ BUILDING CONTRACTORS CLOSE CORPORATIONADRIAAN VAN ZYLHERMANUS GIDEON MARTHINUS VAN ZYLBARBARA IMGARD VAN ZYLCase No.:HC-MD-CIV-ACT-CON-2020/02602Division of Court:HIGH COURT (MAIN DIVISION)Heard before:HONOURABLE LADY JUSTICE RAKOW Date of hearing:18 JANUARY 2021Delivered on:2 FEBRUARY 2021Neutral citation: Nedbank Namibia Limited v AVZ Building Contractors Close Corporation (HC-MD-CIV-ACT-CON-2020/02602) [2021] NAHCMD 21 (2 February 2021)The order:Having read Ms Kandjella, on behalf of the plaintiff/applicant and Mr Pretorius, on behalf of the third and fourth defendants/respondents and having read other documents filed of record:IT IS ORDERED THAT:The third and fourth defendants/respondents are granted leave to defend the matter.Parties are to file a joint case plan report on or before 27 February 2021. The matter is postponed to 2 March 2021 at 15h30 for a case planning hearing.Following below are the reasons for the above order:Introduction[1]The plaintiff/applicant obtained default judgment against the first defendant/respondent for payment in the amount of N$1 824 418.84 and compound interest calculated daily and capitalized monthly on the amount of N$1 824 418.84, at the rate of 16.80 per cent per year from 16 August 2019 to date of final payment and against the second defendant/respondent payment in the amount of N$1 600 000 and compound interest calculated daily and capitalized monthly on the amount of N$1 600 000, at the rate of 16.80 per cent per year from 16 August 2019 to date of final payment. The claim was for monies advanced to the first defendant’s current cheque account.[2]The third claim was instituted against the third and fourth defendants/respondents in terms of a suretyship agreement they signed in favour of the plaintiff/applicant wherein they bound themselves as sureties and co-principal debtors in solidum with the first defendant/respondent for due payment by the first defendant/respondent of monies which may from time to time become owing to the plaintiff/applicant, as well as for the due and punctual performance and discharge by the first defendant/respondent of any contract or agreement entered into by the first defendant/respondent with the plaintiff/applicant, plus such further sums for interest on that amount, charges and costs, including interest, discount, commission, stamps and all legal costs on a scale as between a legal practitioner and his own client. The total amount recoverable from third and fourth defendants/respondents is limited to N$1 600 000. The third and fourth respondents/defendants defended the matter upon which the plaintiff/applicant filed an application for summary judgment.[3]For security for due and punctual fulfillment of their obligations to the plaintiff/applicant, the third and fourth defendants/respondents passed a Mortage Bond in favour of the plaintiff/applicant for a property situated at Erf 192, Henties Bay. The plaintiff/applicant further alleged that they are entitled to have the bonded property declared executable and to recover its costs of suit on an attorney and client scale as per the agreement.Condonation application[4]The court gave directions for the filing of documents and arguments in an order dated 22 October 2020 and specifically directed that the plaintiff/applicant had to file heads of argument on or before 4 January 2021. This did not happen and on 14 January 2021 the plaintiff/applicant filed an application for condoning the late filing of their heads of argument. The legal representative of the plaintiff/applicant filled a founding affidavit explaining that she went on December holidays on 18 December 2020. She did not attend to the file before she went on leave as it slipped her mind. When she resumed duty on 13 January 2021, she came across the file and realized that the date for filing heads of argument was 4 January 2021. She immediately started drafting the said heads and finalized same on 14 January 2021.[5]On 14 January 2021, she addressed a letter to third and fourth defendants’/respondents’ legal practitioner engaging him in terms of rule 32(9) for the late filing of the plaintiff’s/applicant’s heads of argument and whether he would raise any objection to the condonation application when filed. She then proceeded and filed the application at 15h48. The plaintiff/applicant filed a report in terms of rule 32(10) only on 15 January 2021. In her report she explained that she attempted to speak to Mr Erasmus, the legal practitioner for the third and fourth defendants/respondents to discuss an amicable settlement and to ascertain whether he would have an objection to the late filing of the heads of argument. They could not reach Mr Erasmus telephonically and did not want to further delay the filing of their heads. They also forwarded a letter to Mr Erasmus. The email containing the letter was sent at 12h50 on 14 January 2021. The legal practitioner for the plaintiff/applicant again emailed a certain Marihette Fourie at the offices of Mr Erasmus indicating that they need to speak to Mr Erasmus regarding the letter that was emailed to him the previous day, but they were informed by the receptionist that Mr Erasmus is not available. This email was sent on 15 January 2021 at 11:27 am. They again followed up with Mr Erasmus’s office on the same day at 15 January 2021 at 15:13, asking whether they could be provided with a response to their letter that was forwarded to him the previous day. It seems that till the time, the matter proceeded on 18 January 2021 they were not provided with a response on their attempts to engage in terms of rule 32(9).[6]Mr Erasmus did however file a notice to oppose the condonation application on 15 January 2021 at 15h30 together with an answering affidavit and confirmatory affidavit of third and fourth defendants/respondents. In this, they raised the issue that the plaintiff/applicant paid mere lip service to rule 32(9) and that merely delivering a letter on 14 January 2021 is not sufficiently engaging the defendants/respondents. It is further contended that the plaintiff/applicant is to file the rule 32(10) report before filing the application for condonation. The third defendant/respondent however stated that the letter that was sent to their legal representative was sent after the application for condonation was filed. This is not correct, as per the electronic case management system.[7]The plaintiff/applicant for the condonation application filed its notice of motion seeking condonation on the afternoon of 14 January 2021. The court takes into account the explanation provided by the plaintiff/applicant in that she only became aware of her default on the day their business opened on 13 January 2021. This matter was set down to be heard on 18 January 2021. In terms of rule 1(3)(b) however courts are required to as far as possible save costs. This leaves a wide discretion to a court when applying the rules. This also allows for the court to interpret these rules in a very wide scope. The most important requirement would be for the court to allow the matter to proceed with the least costs as well as expeditious as possible.[8]The application for condonation is not typically something that could have been resolved between the parties as such a condonation is sought from the court and cannot be agreed upon between the parties. The only indication that the parties can give is, whether such an application would be opposed or not. The plaintiff/applicant did in fact attempt to comply with rule 32(9) and engage the defendants/respondents, even went as far as writing to the defendants/respondents. The time span allowed for response was however cut short by the pending need to deal with the issue before the date of hearing of the summary judgment application. It is further not proper for the defendants/respondents not to respond, in any way, after numerous attempts were made by the plaintiff/applicant to contact them and to determine their view, then to oppose the application for condonation. There were attempts made to communicate with the defendants/respondents, which attempts seemed to be futile. The defendants/respondents can therefore not escape the consequences of their non-participation in the rule 32(9) process.[9]For these reasons, the court found that there is indeed enough unique circumstances present in the current matter that allows for this matter to be distinguished from the general rule as set out in Bank Windhoek Limited v Benlin Investment and in the interest of costs saving and speedy resolution of matters, to grant condonation for the late filing of the heads of argument by the plaintiff/applicant.The arguments before court[10]The plaintiff/applicant, Nedbank Namibia limited, the principle debtor, is holding the third and fourth defendants/respondents liable for the debt of the first defendant/respondent as they bound themselves as sureties for the debt of the first defendant/respondent on 30 August 2015. The plaintiff/applicant claims payment for the amount of N$1 600 000, which was amount for which they signed surety, interest at a rate of 16,8 per cent per year as from 16 August 2019 to date of payment and an order declaring the property of the third and fourth defendants/respondents at Henties Bay executable. They alleged that they complied with all the formalities in this matter and are therefore entitled to receive summary judgment against the third and fourth defendants/respondents.[11]The argument put forward by the third and fourth defendants/respondents is that the plaintiff/applicant’s particulars of claim is vague and embarrassing and therefore excipiable. These include issues that are raised with the allegation in paragraph 8 where they contend that it is not possible to ascertain which terms of the partly – written partly-oral agreement pleaded by the plaintiff/applicant were agreed to between the plaintiff/applicant and the first defendant/respondent in writing, were expressly agreed to between the plaintiff/applicant and the first defendant/respondent orally, were implied terms of the agreement and which were tacit terms of the agreement; Paragraph 8.3 merely states that the plaintiff/applicant was entitled to charge the first defendant/respondent with interest. The paragraph does not state under what circumstances the plaintiff/applicant would be entitled to charge interest on the first defendant’s/respondent’s account, for example, would the plaintiff/applicant be entitled to charge interest to the first defendant’s/respondent’s account if the account is not in arrears? And when would the first defendant’s/respondent’s account be deemed to be in arrears.[12]The written agreement annexed to the plaintiff/applicant’s particulars of claim, on which the plaintiff/applicant relies for its claim against the defendants/respondents, does not make any provision for the charging of interest on the first defendant’s/respondent’s overdraft facility with the plaintiff/applicant, although the interest rate which the plaintiff/applicant alleges was agreed upon between the parties is specific and is extremely high. The certificate of indebtedness relied upon is a unilateral document and only prima facie proof. The third and fourth defendants/respondents dispute that the interest rate claimed by the plaintiff/applicant was ever agreed to orally by the first defendant/respondent and that the plaintiff/applicant was therefore only entitled to levy the plaintiff’s/applicant’s prime overdraft rate, which was not 16,8 per cent per annum but varied from August 2015 to November 2020 between 10,25 per cent to as low as 7.5 per cent. The calculation of the total amount of indebtedness (the N$1 600 000) is thus disputed as the amount is made up of interest, costs and fees.[13]They further raised the defence that the applicant recklessly provided credit to the first defendant/respondent after it was already clear that it would not be able to service its account. The plaintiff/applicant also provided a loan to the first defendant/respondent in the amount of N$3 200 000 whilst it was aware of the fact that the first defendant/respondent used funds from the cheque account to service the loan account.The applicable law and legal arguments[14]The requirements of rule 60(5)(b) which must be satisfied for a successful opposition to a claim for summary judgment was stated as follows in the locus classicus, Maharaj v Barclays National Bank Ltd 1976 (1) SA 418 (A) at 426A by Corbett JA with regard to the previous rule 32, dealing with summary judgment applications:‘Accordingly, one of the ways in which the defendant may successfully oppose a claim for summary judgment is by satisfying the Court by affidavit that he has a bona fide defence to the claim. Where the defence is based upon facts, in the sense that material facts alleged by the plaintiff/applicant in his summons, or combined summons, are disputed or new facts are alleged constituting a defence, the Court does not attempt to decide these issues or to determine whether or not there is a balance of probabilities in favour of the one party or the other.All that the Court enquires into is:(a)whether the defendant has fully disclosed the nature and the grounds of his defence and the material facts upon which it is founded, and(b)whether on the facts so disclosed the defendant appears to have, as to either the whole or part of the claim, a defence which is bona fide and good in law.If satisfied on these matters the Court must refuse summary judgment, either wholly or in part, as the case may be. The word fully, as used in the context of the Rule (and its predecessors), has been the cause of some judicial controversy in the past. It connotes, in my view, that, while the defendant need not deal exhaustively with the facts and the evidence relied upon to substantiate them, he must at least disclose his defence and the material facts upon which it is based with sufficient particularity and completeness to enable the Court to decide whether the affidavit discloses a bona fide defence.’[15]In general, the approach of the court is as set out by Justice Cheda in Lofty-Eaton v Ramos as follows:‘The general approach of these courts in applications of this nature is that cognisance is taken into account that a summary judgment is an independent, distinctive and a speedy debt collecting mechanism utilized by creditors. It is a tool to use by a plaintiff/applicant where a defendant raises some lame excuse or defence in order to defend a clear claim. These courts, have, therefore, been using this method to justly grant an order to a desperate plaintiff/applicant who without doing so, will continue to endure the frustration mounted by an unscrupulous defendant(s) on the basis of some imagined defence. As remedy available to plaintiff/applicant is an extra-ordinary one and is indeed stringent to the defendant, it should only be availed to a party who has a watertight case and that there is absolutely no chance of respondent/defendant answering it, see Standard Bank of Namibia Ltd v Veldsman. Rule 32 specifically deals with the said applications. Summary judgment is therefore a simple, but, effective method of disposing of suitable cases without high costs and long delays of trial actions, see Caston Ltd v Barrigo. In that case, Roberts AJ went further and crystalised the principle as follows:“It is confined to claims in respect of which it is alleged and appears to the court that the defendant has no bona fide defence, and that appearance has been entered solely for the purpose of delay.”[7]Where a summary judgment has been applied for, the respondent is entitled to oppose, if he has a bona fide defence and in that opposition he/she must depose to an affidavit where he/she should positively state and show that he/she has a bona fide defence to applicant’s claim. Respondent must not only show, but, must satisfy the court that he/she has a bona fide defence. In furtherance of the satisfaction to the court, respondent must at least disclose his defence and material facts upon which it is based with sufficient particularity and completeness to enable the court to decide whether the affidavit discloses a bona fide defence, see Breitenbach v Fiat SA (Edms) BPK?and Namibia Breweries Ltd v Marina Nenzo Serrao. This, however, is not to say that he/she should do so by disclosing all the details and particulars as would be the case of proceedings, see Maharaj v Barclays National Bank Ltd and Breitenbach v Fiat SA.[8]The requirement seems to be relaxed to a certain extent as it is not rigorous per se, but, is designed to enable a genuine respondent to defend a claim which otherwise would result in applicants’ obtaining judgment under circumstances where respondent had a genuine defence. The need for clarity on defendant’s part is designed to avoid the entry of intention to defend an action solely to delay an otherwise just claim by plaintiff/applicant.[9]For that reason, these courts will always seriously consider the granting of a summary judgment and will only do so where a proper case has been made out by applicants. The above principle has been applied in many cases, see also Crede v Standard Bank of South Africa Ltd where Kannemeyer, J remarked:“One must bear in mind that the granting of summary judgment is an extraordinary and drastic remedy based upon the supposition that the plaintiff/applicant’s claim is unimpeachable and that the defendant’s defence is bogus or bad in law.” ’Application[16]The defendants/respondents had to make out a bona fide defence against the application brought by the plaintiff/applicant. This includes making a full disclosure of the defence, which they did, as well as showing that the defence is good in law. In this instance, the court finds that the defences disclosed have the potential to be good in law and give the defendants/respondents leave to defend the matter.Judge’s signatureNote to the parties:Not applicable Counsel:Plaintiff /ApplicantThird and Fourth Defendants/RespondentsR KandjellaofAngulaCo. Inc., WindhoekF A PretoriusofFrancois Erasmus & Partners, Windhoek ................
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