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 IN THE HIGH COURT OF SOUTH AFRICA

FREE STATE PROVINCIAL DIVISION     

                                                                   Case number: 1955/2016[1]

THE LAND AND AGRICULTURAL DEVELOPMENT

BANK OF SOUTH AFRICA                                                                                  1^st Plaintiff[2]

SUIDWES LANDBOU (PTY) LTD                                                                      2^nd Plaintiff

and

BAREND JACOBUS VAN DEN BERG                                                           1st Defendant[3]

LORRAINE MARLENE VAN DEN BERG                                                     2^nd Defendant

BAREND JACOBUS VAN DEN BERG N.O.                                                  3^rd Defendant

LORRAINE MARLENE VAN DEN BERG N.O.                                            4^th Defendant

HENDRIK STEPHANUS LODEWICUS DU PLESSIS N.O.                        5^th Defendant

REGISTRAR OF DEEDS, BLOEMFONTEIN                                               6^th Defendant[4]

Coram:                                   Opperman, J

Date of hearing:                    28 January 2021

Delivered:                             The judgment was handed down electronically by circulation to the parties’ legal representatives by email and release to SAFLII on 23 March 2021. The date and time for hand-down is deemed to be 23 March 2021 at 15h00.

Summary:                              Interlocutory application to compel

JUDGMENT

[1]               On 11 March 2020 the 1^st to 5^th defendants lodged an application for an order:

1.1              Declaring that the plaintiffs’ answer, alternatively certain parts thereof, filed in response to the defendants’ request for discovery made in terms of Rule 35(3) as delivered on 3 December 2019 does not comply with the provisions of Rule 35(3);

1.2              Compelling the plaintiffs to comply with the request for discovery made in terms of Rule 35(3) as delivered on 3 December 2019 within such period that the Honourable Court may determine reasonable;

1.3              Compelling the plaintiffs to make the requested documents not disclosed by them available for inspection in accordance with sub-rule (6) or to state on oath within ten days that such documents are not in their possession, in which event they shall state their whereabouts, if known to them;

1.4              Ordering the plaintiffs to pay the costs of this application on an scale as between attorney and own client;

1.5              Granting further and/or alternative relief.

[2]          The 1955/2016 matter served before me for the first time on trial. The matter was set down for 26, 27 and 29 November 2019. In light of the extraordinary broad scope of the issues that would have had to be dealt with and determined in the 2016-trial, the parties at a supplementary pre-trial conference held on 22 November 2019, agreed to request the Court to separate a number of issues in terms of Rule 33(4) to be adjudicated first and separately before the remaining issues. The order was granted and the separated issues are:

“By agreement the plaintiffs and First to Fifth defendants request the Honourable Court to:

1.                 Order that the issues referred to herein below be separated and that they be tried first and separate from all the other issues in terms of the provisions of Rule 33(4):

1.1       Whether the second plaintiff and the first defendant concluded the written loan agreement, a copy of which is appended as Annexure “BV3” to the amended particulars of claim, (Paragraphs 8.1, 8.3 and 8.4 of the amended particulars of claim read with paragraphs 23 and 24 of the amended plea).

1.2       Whether the second plaintiff and the first defendant concluded a written contract-financing agreement, a copy of which is appended as Annexure “BV7” to the particulars of claim.  (Paragraphs 9.2, 9.3 and 9.4 of the amended particulars of claim read with paragraph 25 of the amended plea).

1.3       Whether the second defendant bound herself as surety and co-principal debtor, jointly and severally in terms of a deed of suretyship, a copy of which is appended as Annexure “BV8” to the amended particulars of claim (and which the second defendant admits to having signed), for due performance of all obligations for which the Hermanusdam Trust might be liable to the second plaintiff (Paragraphs 10.1 and 10.2, as they stand to be amended by referring to the Hermanusdam Trust instead of the first defendant as principal debtor, of amended particulars of claim read with paragraph 26 of the amended plea).

1.4       Whether the third defendant was duly authorised by the trustees of the Hermanusdam Trust (the third to fifth defendants) to sign the deed of suretyship Annexure “BV9” on behalf of the trustees of the Hermanusdam Trust.  Alternatively, whether the trustees of the Hermanusdam Trust delegated the authority of the trustees to sign deeds of suretyship on behalf of the Hermanusdam Trust to the third defendant (Paragraphs 10.3.2 to 10.3.4 of the amended particulars of claim read with paragraphs 10 and 26 of the amended plea).

1.5       Whether the Hermanusdam Trust bound itself as surety and co-principal debtor, jointly and severally, for the due performance of all obligations for which the first defendant might become liable to the second plaintiff, in terms of the deed of suretyship, a copy of which is attached as Annexure “BV9” to the amended particulars of claim and which is attached as Annexure “BV9” to the amended particulars of claim and which the third defendant admits to having signed (Paragraphs 10.1 and 10.3.1 of the amended particulars of claim read with paragraph 26 of the amended plea).

1.6       Whether the trustees of the Hermanusdam Trust (the third to fifth defendants) authorised the registration of mortgage bond number B2152/2014, a copy of which is annexed as Annexure “BV10” to the amended particulars of claim and whether registration of such mortgage bond is permitted by the trust deed.  (Paragraphs 11.1 to 11.3.5 of the amended particulars of claim read with paragraphs 11, 12 and 27 of the amended plea).

1.7       Whether the trustees of the Hermanusdam Trust (the third to fifth defendants), and as a result the Hermanusdam Trust, is estopped from denying that the third defendant was duly authorised to sign the suretyship (“BV9”) and to register the mortgage bond (“BV10”) on behalf of the trustees of the Hermanusdam Trust in the event that it is found that the third defendant was not duly authorised to sign the deed of suretyship (“BV9”) on behalf of the trustees of the Hermanusdam Trust and that he was not authorised to take the necessary steps to register the bond (“BV10”) in favour of the second plaintiff.  (Paragraphs 11.1 to 11.6.2 of the amended plea read with paragraphs 19.1 to 19.7 of the replication).

1.8       Whether the second plaintiff ceded and transferred to the first defendant its right, title and interest in the relevant personal rights that the second defendant contends it obtained as against the first defendant on account of advances that the second plaintiff contends it had had made to the first defendant in terms of the written loan agreement (Annexure “BV3” to the amended particulars of claim) and the contract-financing agreement (Annexure “BV7” to the amended particulars of claim), including the rights which the second plaintiff contends it had acquired in terms of the abovementioned deeds of suretyship (Annexures “BV8” and BV9”).  (Paragraph 6 of the particulars of claim read with paragraph 21 of the amended plea).

1.9       Whether the second plaintiff ceded the right, title and interest in and to the mortgage bond “BV10.1” to the amended particulars of claim to the first plaintiff and whether the sixth defendant registered such session in its records and endorsed the mortgage bond B2152/2014 (“BV10”) accordingly.  (Paragraphs 11.3.6 and 11.3.7 of the amended particulars of claim read with paragraph 27 of the amended plea).

1.10    Whether the loan agreement (“BV3”) and the contract- financing agreement (“BV7”), both of which constitute credit agreements in terms of the Credit Act, were preceded by a pre-agreement statement and quotation that satisfied the requirements of section 92(2)(a)(i) and Section 93 of the National Credit Act, 24 of 2005 (“the Credit Act”), Regulation 29(1)(c) and (d) and form 20.1.  (Paragraphs 1.1, 1.2, 1.3 and 1.5 of the amended pleas read with paragraph 9.2 of the replication).

1.11    Whether the credit agreements (“BV3”) of  (“BV7”), are void or voidable if it is found that they were not preceded by a pre-agreement statement and a quotation as contemplated in paragraph 1.10 (Paragraph 1.6 of the amended plea read with paragraph 9.4 of the replication).

1.12    Whether the court is entitled and empowered to declare the credit agreements (“BV3”) or (“BV7”) unlawful without the same time making an order in terms of section 90(4)(b) of the Credit Act which is just and reasonable.  (prayer 37.2.1 of the counterclaim read with paragraph 2.2.4 of the amended plea to the counterclaim).

1.13    Whether the second defendant conducted an assessment, as contemplated in section 81(2) and as required in terms of section 80(1)(a) of the Credit Act in relation to the loan agreement (“BV3”) or the contract- financing agreement (“BV7”).

1.13.1    Should it be found that the second defendant did not conduct such an assessment in respect of the credit agreement “BV3”; whether the relevant credit agreement constitutes reckless credit as contemplated in section 80 of the Credit Act.

1.13.2    Should the court find that the second plaintiff did not conduct said assessment in respect of the credit agreement “BV7”; whether said credit agreement constitutes reckless credit as contemplated in section 80 of the Credit Act.

1.13.3    Should the court find that second plaintiff indeed conducted the assessment referred to in paragraph 1.13 above in respect of the credit agreement “BV3”, whether the second plaintiff entered into the credit agreement “BV3” despite the fact that the preponderance of information available to the second plaintiff indicated that first defendant did not generally understand or appreciate his risks, costs or obligations under the proposed credit agreement as contemplated in Section 80(2)(b)(i) and/or entering into said credit agreement would make the first defendant over indebted as contemplated in section 80(1)(b)(ii), and/or whether the credit agreement is void in such circumstances.

1.13.4    Should the court find that the second plaintiff conducted the required assessment referred to in paragraph 1.13 above in respect of the credit agreement “BV7”; whether the second plaintiff entered into the credit agreement with the first defendant despite the fact that the preponderance of information available to the second plaintiff indicated that the first defendant did not generally understand or appreciate his risks, costs or obligations under the proposed credit agreement as contemplated by section 80(1)(b)(i), and/or entering into the credit agreement would make the first defendant over indebted as contemplated by section 80(1)(b)(ii) and/or whether the credit agreement is void in such circumstances.  (Paragraphs 3.2 to 3.3 of the amended plea read with paragraphs 11 to 11.4 of the replication).

1.14   Should it be found that the credit agreements (“BV3”) or (“BV7”) constitute reckless credit agreements as contemplated in section 80 of the Credit Act but that it is not void:

1.14.1    Whether the agreements (“BV3”) or (“BV7”) in such circumstances, are of no force and effect in view of section 81(3) of the Credit Act.  (prayer 37.2.2.2 of the counterclaim read with paragraph 2.2.3 of the amended plea to the counterclaim);

1.14.2    Whether the court is empowered, in terms of the provisions of section 83(2)(a) of the Credit Act to set aside the first defendant’s rights and obligations in terms of either or both of the credit agreements without the court at the same time making an order that is just and equitable in the circumstances (prayers 37.2.2.3 of the counterclaim read with paragraphs 2.2.6 and 2.2.6.1 of the amended pleas to the counterclaim);

1.14.3    Whether the court is entitled and empowered in terms of the provisions of section 83(2)(b) of the Credit Act to suspend the force and effect the credit agreements indefinitely and without determining a date for their resumption, (prayers 37.2.2.4 of the counterclaim read with the applicable prayer in terms of the amended plea to the counterclaim);

1.14.4    Whether the court is empowered and entitled to declare void or alter the alleged unlawful provisions of the relevant credit agreements in terms of section 90(4) of the Credit Act, without the court at the same time making an order which is just and equitable in the circumstances.  (prayer 37.2.2.5 of the counterclaim read with paragraphs 2.2.4 and 2.2.4.1 of the amended pleas to the counterclaim).

1.15   Whether the credit agreements (“BV3”) or (“BV7”) comply with the provisions of section 93(3) of the Credit Act and to the requirements of regulation 31. (Paragraphs 2.1 to 2.3 of the amended plea red with paragraphs 10.1 to 10.5.3 of the replication).

1.16   Should it be found that the credit agreements (“BV3”) or (“BV7”) do not comply with the requirements referred to in paragraph 1.15 above, whether (“BV3”) or (“BV7”) are void or voidable.  (Paragraph 2.3 of the amended plea read with paragraph 10.4 of the replication).

1.17   Whether the Credit Act applies to the deed of suretyship (“BV8”) and as a result to the second defendant.

1.18   Whether the Credit Act applies to the Hermanusdam Trust, and as a result to the deed of suretyship (“BV9”) as well as the mortgage bond (“BV10”).

2.                 To order that the remainder of the issues stand over for later determination.

3.                 To specifically order that the issues that stand over for later adjudication include the issues which relate to the nature of the further orders, if any, that the court ought to grant in the event that the court declares either or both of the credit agreements (“BV3”) and (“BV7”) or any of their terms unlawful or void in terms of the provisions of section 90(4) of the Credit Act or set such agreements or terms thereof aside in terms of the provisions of section 83(2)(a) of the Credit Act or to suspend such agreement or terms thereof in terms of the provisions of section 83(2)(b) of the Credit Act.

4.                 To note that the wording employed in the agreement to separate the issues will not be taken to supplement or amend the content of the pleadings.

5.                 To order that the parties shall be entitled at the trial of the remainder of the issues, if applicable, to present the evidence of witnesses that had already testified in relation to the aforementioned issues (that will be determined first) and to further request that any such witness who is not called by the plaintiffs or the defendants as a witness, be recalled for purposes of cross-examination in relation to the remainder of the issues that form the subject matter of the trial.

6.                 The parties shall, at the trial of the issues that must be determined first, be constrained to present evidence in relation to the issues identified in paragraphs 1.1 to 1.18 above, but evidence which was presented during the trial on the issues identified in 1.1. to 1.18 above, and which maybe relevant to the remainder of the issues which stand over for the later determination, shall remain binding on the adjudication of the remainder of the issues.”

[3]          The trial in the main matter, 1955/2016, on the separated issues commenced on 27 November 2019 and the evidence of one Coreen Steyn was finalised. The trial could not be finalised on the 29^th of  November 2019 and the matter was postponed to 14, 15, 17, 21, 22 and 24 April 2020. Due to the Covid pandemic the matter had to be postponed to 17 to 27 November 2020. The trial has been postponed provisionally to 3, 4, 6, 10 and 13 August 2021 to dispose of the interlocutory issues. The delay is obvious; almost two years.

[4]          Unexpectedly the application to compel and another for consolidation was filed on 11 March 2020 by Mr. Du Plessis. I dealt with the application for consolidation in a separate judgment and ordered as follows:

In the circumstances of the present case, I neither regard it as convenient nor am I prepared to exercise the discretion afforded to the Court by Rule 11 in order to consolidate the two actions. The prejudice will be too severe to some parties and the administration of justice. The following orders are thus made:

1.                 The application in terms of Rule 11 of the Uniform Rules to consolidate the actions under case number 1955/2016 and 765/2019 in order for the matters to proceed as one action, is denied.

2.                 The applicants to pay the costs on an attorney and client scale in the High Court; including the costs of two Counsel.

[5]          The succinct basis on which the 1^st and 2^nd plaintiffs oppose the application to compel are that:

1.                 The order sought is overly broad, and the plaintiffs submit to such extent that an order granted in such terms will be ineffective and unenforceable;

2.                 The facts show that the documents which the defendants called for in the Rule 35(3) notice are in contestation (“the disputed documents”), were justifiably refused by the plaintiffs.          

[6]          Apart from the application to consolidate and another to compel there was also a point in limine objection to the validity of a statement by a witness for the respondents. As was pointed out by this witness in the Answering Affidavit to this application^[5] the plea delivered by the defendants in the 2016-case is packed with special pleas; twenty to be exact, four conditional special pleas and multiple layered lines of defences on merits. In tandem with the defendants’ plea Van den Berg filed three conditional counterclaims, an unconditional claim for damages and a conditional claim for damages. The second defendant filed a conditional counterclaim and the third to fifth defendants; trustees of the Hermanusdam Trust, filed two conditional counterclaims. In addition, the defendants delivered a third-party notice in terms of Rule 13(1)(b), claiming wide raging relief against the second plaintiff or third party. 

[7]          A strange twist in casu is that Mr. Du Plessis as the 5^th defendant in the 2016-case; this case, in his capacity as trustee of the Hermanusdam Trust has took it upon himself to represent all the defendants but for the Registrar of Deeds. He carries the mandate of the other defendants in their personal capacity and as trustees. The case went awry when Counsel for the plaintiffs commented that Mr. Du Plessis, being so close to the case, testifies from the bar during argument. This conflated the duty and identity of the legal representative, the party to the dispute and the possible witness that is situated in the one person that is Mr. Du Plessis. It was argued that if he does not testify unfavourable inferences might be drawn when the evidence is evaluated. The issue of a fair trial comes into play; will the rest of the defendants have had a fair trial if there were conflicts in interest and how will it affect the case for the plaintiffs? Millions of Rands are at stake and the costs must have culminated into hundreds of thousands of Rands by now. A counterclaim of 17 million Rands was mentioned by Advocate van der Walt; Counsel for the plaintiffs.^[6]

[8]          I called a halt to the proceedings and implored Mr. Du Plessis to reconsider his position. Mr. Du Plessis obtained opinion from a “Senior Counsel in Johannesburg” that could not fault his appearance on behalf of the 1^st to 4^th defendants and himself as 5^th defendant in his capacity as trustee of the Hermanusdam Trust. I do not have the authority to force choice of Counsel but must ensure a fair trial and proper conduct of Legal Practitioners and will do so as far as possible. The defendants know their rights and the consequences of their choice. They will not be allowed to cry foul in future on this aspect.

[9]          Careful reading of the request to compel discovery and with due regard to the separated issues; the information and documents that were refused and not supplied does not have any bearing on the Rule 33(4) matters specified and which forms the crux of this trial. It will not take the matter any further. It is overly broad and will cause ineffective orders by this court that will become unenforceable. If I am mistaken; the detail of the explanations with which Counsel for Landbank dealt with the issues of law and each and every disputed document convinced that they are correct and the application must be dismissed. I will not burden the judgment with the extensive expose thereof and to be found in the Founding Affidavit, Opposing Affidavit, Replying Affidavit, Applicants Heads of Argument, Respondents Heads of Argument, Applicants Supplementary Heads of Argument and the Respondents Heads of Argument.

[10]        Ancillary Heads of Argument filed by Mr. Du Plessis attacked the deponent of the Answering Affidavit in that he did not state that his affidavit is true and correct, the Answering Affidavit has no evidential value, is irrelevant and must be disregarded for the purposes of the application. Mr. Du Plessis lost complete control over his management of the case in that his conduct came to fall short of what is expected of a legal practitioner at this stage. Counsel for Landbank correctly pointed out that the personal attack against Nagel, the deponent of the affidavit; that he deliberately omitted to swear to the truth is factually incorrect. At the foot-end of the statement, as in most statements, Nagel acknowledged that he knows and understands the content of his affidavit and that it was sworn before the commissioner of oath. The affidavit complies with the legislative prescriptions and the case law referred to by Mr. Du Plessis is out of context.

[11]        In conclusion and after hearing extensive argument for both the applicants and the respondents the application stands to be dismissed. In light of the conduct of Mr. Du Plessis and in view of his unbecoming behaviour during the hearing of this matter as legal representative and party to the litigation, a punitive costs order is unavoidable.

[12]        ORDER

1.     Prayers 1.1, 1.2, and 1.3 of the “Interlocutory application in terms of Rule 30A read with Rule 35” dated 11 March 2020 are dismissed with costs.

2.     The applicants of this application to compel; to jointly and severally pay the costs  of the respondents on a scale as between attorney and own client; including the costs of two counsel.

                                                                                                            _____________________

                                                                                                            M OPPERMAN, J

APPEARANCES

On behalf of the Applicants/Defendants                                                         MR HSL DU PLESSIS

                                                                                                    HSL Du Plessis Attorneys

c/o Lovius Block Attorneys

First Avenue 31

Westdene Bloemfontein

Email: lorinda@loviusblock.co.za

Ref: OJ van Schalkwyk

On behalf of the Respondents/Plaintiffs                               ADVOCATE D.J. VAN DER WALT SC

                                                                        ADVOCATE WILLEM VAN ASWEGEN

L Strating

Symington & De Kok Attorneys

169B Nelson Mandela Drive

Bloemfontein

                                                                          Ref: MKH0637

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