Botswana: Court of Appeal

                  Court of Appeal Civil Appeal No. 025 of 2005

In the matter between

T & H GAME FARMING (PTY) LTD              APPELLANT

ANDREW JOHN SOLOMON                        1^ST RESPONDENT

FREDERIK STEFANUS BOTHA           2^ND RESPONDENT

RAMODIBEDI JA

[1]      This appeal is concerned with the refusal of the High Court to rescind a default judgment granted in favour of the first respondent and against the appellant on 13 May 2004. The appellant has appealed to this Court citing no fewer than 15 grounds of appeal.

[2]      A perusal of most of the appellant’s grounds of appeal, however, clearly shows that they are simply directed at the reasons for the judgment of the court a quo and not at the substantive order made by that court. It need hardly be stressed, as courts have so often held, that an appeal does not lie against the reasons for judgment but only against the substantive order made by a court. See for example, Administrator, Cape & Another v Ntshwaqela & Others 1990 (1) SA 705 (A) at 715 C-D.

[3]      In summary, the appellant’s grounds of appeal seek to show that he had a bona fide defence to the first respondent’s claim. The court a quo, however, held that no such bona fide defence was shown to exist. The question which primarily arises for determination in this appeal, therefore, is whether the court a quo was justified in reaching this conclusion.

[4]      Before proceeding further, it is necessary to record at this stage that, although Frederik Stefanus Botha (“Botha”) is cited as the second respondent, in fact he is taking no further part in these proceedings. It is reasonable to assume, therefore, that he is prepared to abide by the judgment of this Court.

[5]      This case started as an action in terms of which the first respondent sued the appellant jointly with Botha for:

                  “1.       Payment of the sum of P177 500.00;

Interest at 10% a tempore morae;

3.      

Cost (sic) of suit on the Attorney and client scale;

4.      

Collection commission on the amount reflected in claim 1 at the rate of 10%.”

[6]      The first respondent based his cause of action squarely on an “Acknowledgement of Debt”, annexure “X”, dated 11 November 2002. It was alleged in the particulars of claim that the defendants were indebted to the plaintiff in the sum of P177 500.00 (One Hundred and Seventy Seven thousand and Five Hundred Pula) in respect of an Acknowledgement of Debt signed by the defendants at Maun on the date in question.

[8]      Generally speaking, an applicant for rescission of default judgment must satisfy two requirements, namely, (1) that he was not in wilful default and (2) that he has a bona fide defence to the plaintiff’s claim.

[9]      Now, the requirements for a bona fide defence were succinctly laid down by this Court in the seminal judgment of TEBBUTT JA (as he then was) in the case of Du Setto (Sunnyside II) (Pty) Ltd and Others v Financial Services Company of Botswana Ltd 1994 BLR 274 at 287. After reviewing the authorities, the learned Judge of Appeal said this:

“Those cases lay down that the defendant must satisfy the court that he has a defence which, if proved, would constitute an answer to the claim and that he is advancing it honestly. He must disclose what his defence is and set out the material facts upon which it is based and while he need not deal exhaustively with the facts and evidence relied upon to substantiate his defence or with the detail or precision required of a pleading, he must set them out with sufficient particularity and completeness to enable the court to decide whether the affidavit discloses a bona fide defence or not.

The allegations in the affidavit must not be bald, vague or sketchy. What is required is that the defence be not set out so baldly, vaguely or laconically that the court, with due regard to all the circumstances, receives the impression that the defendant has, or may have, dishonestly sought to avoid the dangers inherent in the presentation of a fuller or clearer version of the defence which he claims to have.

The affidavit must not lack “forthrightness as well as the particularity that a candid disclosure of a defence should embody” (see Diesel Power Plant Hire case supra at 298D-F). It has also been held that “if the statements of fact are equivocal or ambiguous or contradictory or fail to canvass matters essential to the defence raised, then the affidavit does not comply with the rule” (see also Arend v. Astra Furnishers supra at 304A-B). It is not an onerous task to file an affidavit which meets the requirements of the Rule. On the contrary it is a simple matter where a bona fide defence is available to a defendant. If he does not do so, the court will be entitled to grant summary judgment and not only where the plaintiff’s case is an unanswerable one.”

Although that was a case for summary judgment, the principles laid down therein apply with equal force to an application for rescission of default judgment. It is on that basis then that one must approach this matter.

[10]     It is convenient at this stage first to refer to the defence which the appellant seeks to advance in opposition to first respondent’s claim. The high water-mark of the appellant’s defence is that the goods forming the subject matter of the Acknowledgment of Debt were “consignment sale.” This, as I understand it, meant that the appellant would pay for the goods if, and when they were sold. I observe at the outset, therefore, that the appellant concedes being in possession of the goods in question.

[11]     At this stage it is instructive to note that, on the test laid down in Du Setto’s case (supra), the appellant’s defence based on the allegation of “consignment sale” might be sufficient to pass muster were it the only consideration in the circumstances. The matter, however does not end there, even if one assumes in favour of the appellant on this point.

[12]     One must remember that the first respondent’s claim is founded on the Acknowledgment of Debt. The question therefore is whether this document is valid or not and whether it is binding upon the appellant. If it is valid and binding, logically the appellant’s big story about “consignment sale” will naturally fall away. This must clearly be so because the two versions advanced by the opposing parties are, in my view, mutually destructive.

[13]     Now, it will be noted that the top cover of the Acknowledgment of Debt bears this inscription:

[14]     The contents of the Acknowledgment of Debt in turn read as follows:

                 

I, the undersigned,

                  FREDERIK STEFANUS BOTHA, and
                  T & H GAME FARMING (PTY) LTD
                  (herein collectively referred to as the “DEBTOR”)

P. O. Box 21689 Boseja, Maun, which address I choose as domicilium citandi et executandi for purposes hereof; do hereby admit that I am liable and hold myself bound to

                           (hereinafter referred to as the “CREDITOR”)

for the due and proper payment of the amount stipulated in annexure “A”.

AND FURTHERMORE I DECLARE that I am bound by the conditions set out in the annexure hereto marked “A” which document I have initialed for the purposes of identification.

THUS DONE AND SIGNED AT MAUN ON THIS 11 DAY OF NOVEMBER 2002 IN THE PRESENCE OF THE UNDERSIGNED WITNESSES:

                  WITNESSES:

1.       ______(signed)_____________

2.       ______(signed)_____________

__________(signed)_________
SIGNATURE OF DEBTOR”

[15]     Annexure “A” referred to in the Acknowledgment of Debt stipulates, inter alia, that the amount due “in terms of the causa of the agreement” is P260 000.00 (Two Hundred and Sixty Thousand Pula) thereafter referred to as the “Debt”.

[16]     Another material term of the Acknowledgment of Debt is that it makes provision for the debt to be paid in instalments as fully set out in annexure “B”. This annexure sets out the monthly instalments to be paid with effect from 30 November 2002 ending at zero balance on 31 May 2005. But before leaving this annexure, it is instructive to record that it bears a heading which, although it is written in Afrikaans, admittedly records the appellant’s “indebtedness” to the first respondent, albeit, trading under a different name.

[17]     Admittedly, the Acknowledgment of Debt is a very poorly and inelegantly drafted document. It behoves the court, however, to endeavour to discover the common intention of the parties despite the shortcomings of the document. The appellant has understandably been quick to try and take advantage of these flaws. It challenges Botha’s authority to bind it. For example, attention is drawn to the use of a singular yet there are supposed to be two debtors. In my view, however, this criticism loses sight of the fact that the framer of this document apparently decided to refer to the debtors collectively as one entity.

(1)      At no time after the signing of the Acknowledgment of Debt did the appellant dissociate itself from it. Not once did the appellant take steps to set aside this document.

(2)     

On appellant’s version through Anadia Van Zyl who was its shareholder and director, the appellant became aware of the Acknowledgment of Debt at least in December to January 2002-2003. She says that she and her husband “hit the roof” with fury. If that is so, it is inconceivable that the appellant would have failed to take any action at all.

(3)     

More importantly, the appellant honoured the Acknowledgment of Debt by making substantial payments to the first respondent totaling P82 500.00. It would be idle, in these circumstances, in my view, for the appellant to contend that it did not know what it was paying for.

(4)     

Such payments were made by appellant’s own company cheques and were significantly not signed by Botha.

(5)     

Significantly, when the appellant stopped paying in October 2003, the first respondent pressed for payment and also threatened it with legal action. Thereafter the appellant delivered to the first respondent six post-dated cheques in the amount of P1 000.00 each without offering any explanation. The first respondent refused to accept the cheques.

(6)     

As pointed out in paragraph [10] above, the appellant admits that it is in possession of the goods forming the subject matter of the Acknowledgment of Debt. It, however, has failed to give a full account of such goods, that is to say, what goods it had in its possession from the beginning and what goods it has now. There is not an iota of evidence showing full disclosure as would be expected of the appellant in the circumstances. It seems to me that the appellant is prepared to blow hot and cold at the same time. For example, at one stage it was contended on its behalf that the goods in question were “utterly and totally useless” and “unsaleable.”

[20]     The principle that the subsequent conduct of the parties to an otherwise vague contract is a relevant consideration in determining the common intention of the parties finds support in a case decided some seventy-four years ago in Breed v Van Den Berg and Others 1932 AD 283 at p 292-293.

[21]     It follows from the aforegoing considerations that, as a matter of overwhelming probabilities, the Acknowledgment of Debt in question is a valid document which was duly executed by Botha in his capacity as the appellant’s shareholder as well as representative. It is not disputed for that matter that Botha was appellant’s shareholder and manager. On his own version, he had “overall charge” of appellant’s company.

[22]     In the light of these considerations, the court a quo was justified in finding that the appellant had no bona fide defence to the first respondent’s claim. It is instructive to remember for that matter that in terms of Order 30 and 31(3) of the Rules of the High Court, rescission of default judgment is a matter within the discretion of the trial court. An appellate court will, therefore, not lightly interfere with such discretion unless there is a material misdirection resulting in a miscarriage of justice. Such is not the position here.

                                                                        _________________
I AGREE                                                        N. W. ZIETSMAN