South Africa: High Courts - Gauteng

[1] This is an application for the rescission of an order handed down by Hartzenberg ADJP in April 2005. The applicant also applies for leave to enter appearance to defend within 10 days of the rescission order. The order was based on an agreement reached between the parties pertaining to the liability of the applicant for damages caused in an accident in which a vehicle of his was involved. Applicant states that the letter from his attorney which purported to amount to a consent to the order, was not mandated by him. For purposes of this judgment I shall refer to second applicant as applicant.
Background

[2] The second respondent ( to whom I shall refer as the respondent) was a passenger in a bus driven by a Mr Zulu, an employee of KR Sibanyoni Transport Services CC. After R25000 was awarded to the second respondent by the Road Accident Fund, respondent issued summons in the magistrate’s court against Mr Zulu and applicant for damages at common law. The matter was defended by the insurers of the applicant. The cover with the insurer was, however, only for R20 000 per passenger. This was duly paid to the respondent. Respondent then claimed the balance of her damages from the applicant.

[3] Thereafter the attorney of applicant withdrew and was substituted by Magolego Attorneys. From the time when Magolego attorneys came on record negotiations took place between the parties up to the date of the trial, 26 April 2005. The matter was directly settled with the respondent’s attorneys of record and senior counsel, J O’D Williams SC. The settlement was then made an order of Court on the 26^th April 2005.
[4] By 7^th June applicant had failed to make payment in terms of the Court order. A telephone call was made to the applicant by respondent’s attorney, Mr Basson of Marais Basson Attorneys. During this conversation the applicant conveyed to Mr Basson that he was under no obligation to pay. The attorneys of his brokers had given him this advice. Shortly thereafter the respondent proceeded with a writ of execution. On the 5^th July 2005 the applicant approached this court to have the order issued by Hartzenberg ADJP rescinded on the basis that he had not mandated his attorney to settle the matter on his behalf.

[6] High Court Rule 42(1) which deals with the rescission of judgments on specified grounds is not applicable to the present matter. I will, accordingly, revert to common law principles. At common law a judgment may be set aside on grounds of fraud and iustus error. DH Van Zyl AJ ( as he then was) said the following in Groenewald v Gracia !985(3) SA 968(T) in this regard:

A cause, including justus error….Certainly a litigant who is himself negligent and the author of his own misfortune will fail in his request for rescission. See Voet 2.4.14; Groenewald v Gracia (Edms) Bpk 1985 (3) SA 968 (T) at 972C-D and G-H.”

Gubbay CJ repeated the above principles in more detail in Georgias v Standard Chartered Finance Zimbabwe Ltd, 2000(1) SA 126(Z) at 132G. a judgment of the Supreme Court of Zimbabwe :

[8] In Ntlabezo v MEC for Education, Culture & Sport Eastern Cape 2001(2) SA 1073(TkH). the judgment of the Zimbabwe Supreme Court was referred to with approval by D van Zyl J in the Transkei High Court :

“The only question which remains is whether this finding has the result that rescission must be granted without considering factors such as the bona fides of the application for rescission. In Georgias v Standard Chartered Finance Zimbabwe Ltd (supra) the Zimbabwe Supreme Court, sitting on appeal, held that, in deciding whether to rescind a judgment given by consent, regard must also be had to (1) the reasonableness of the explanation proffered by the applicant of the circumstances in which the consent judgment was entered; (2) the bona fides of the application for rescission and (3) bona fides of the defence on the merits of the case which prima facie carries some prospect of success (at 132G - I). At 132C - D Gubbay CJ said the following:
         'Although lack of consent is undoubtedly the predominant factor in the decision of whether or not to set aside a judgment purported to have been given with the consent of the parties, regard must also be had, in my view, to the factors alluded to by Blackie J and mentioned by Mr De Bourbon. I think that only where the defence offered to the action is virtually unarguable, or the delay in bringing the application inordinate and unsatisfactorily explained, should a Court decline the relief of rescission.'

I agree with this approach.”

[9] I also, with respect, agree with the approach of Gubbay CJ. The mere fact that there was no agreement would not entitle the applicant to success. He has to show that he also acted bona fide and reasonably in the circumstances. If I find that the applicant has, on the evidence before me, agreed to the settlement I need not consider whether he also acted reasonably. The application is, of course, to be decided in accordance with the Plascon-Evans Paints Ltd-rule in so far as the relief should only be granted if the facts as stated by the respondent together with the admitted facts in the applicant’s affidavit justify such an order. There may be exceptions to this general rule. For example, where the allegations or denials of the respondent are so far-fetched or clearly untenable that the Court is justified in rejecting them merely on the papers.
Evaluation

[10] After the matter had been enrolled for 26 April 2005 and the applicant had obtained the services of new attorneys (Magolego Attorneys), the latter proceeded to request a postponement of the trial, which was set down for 26 April 2005, as early as 8 April 2005.On 11 April 2005 a telephonic discussion took place between Mr Magolego and Mr Basson, acting on behalf of the respondent, during which conversation Mr Basson indicated to Mr Magolego that the respondent would not be amenable to a postponement of the matter. On 12 April 2005, Magolego Attorneys addressed a letter to Marais Basson Attorneys not ruling out the possibility of a settlement and once again requesting a postponement of the matter. On 13 April 2005 the respondent’s attorneys addressed a letter to Magolego Attorneys, once again reiterating that in the event of a postponement a substantive application was required from the applicant.

[11] From the above it is evident that the respondent was never amenable to the matter being postponed whilst it was set down for 26 April 2005. In the event of the applicant seeking a postponement, a substantive application would have been necessary.
[12] As a result of the parties having been unable to agree on a postponement, a meeting was scheduled for 15 April 2005 at the offices of Marais Basson in Witbank, at the request of the applicant’s legal representatives. Present at the meeting were Mr Basson, Mr Magolego, the applicant and his son. Settlement proposals were made and reacted to during the meeting in the presence of the applicant, where after the applicant’s legal representative undertook to revert to Mr Basson. During the meeting the applicant at no stage denied liability nor did the issue of vicarious liability for the driver feature in any discussion.
[13] Thereafter a pre-trial meeting was scheduled for 19 April 2005, which was not attended by the applicant or his legal representatives. Instead the applicant forwarded a letter, in which the possibility of a settlement was not ruled out and certain documents were requested. Quantification was, it would seem, the only problem.

[14] A second pre-trial meeting was arranged for 21 April 2005 at the chambers of Adv Williams SC, in Brooklyn Pretoria. Present at the pre-trial meeting was Adv Williams SC, Mr Basson, Adv Mabaso, Mr Magolego, the applicant and his son. During the pre-trial meeting a settlement of the matter was discussed to the extent that Mr Basson, acting on behalf of the respondent, supplied the applicant with details of his quantification of the claim in his own handwritten note. At no stage during the pre-trial meeting was the absence of vicarious liability The absence of which is raised by the applicant in the papers before me. raised or discussed between the parties. The pre-trial meeting ended with the applicant requesting that he be supplied with details regarding all outstanding claims (of other passengers involved in the same accident).
[15] A third pre-trial meeting was scheduled for 26 April 2005. Prior to the pre-trial meeting on 26 April 2005 a letter was forwarded to Magolego Attorneys regarding the quantification of the respondent’s claim. On the 26^th April the respondent’s view was quite clear that the matter would not be postponed. The applicant had not furnished any further request for postponement, nor was there any substantive application seeking a postponement. On 26 April 2005 (the morning of the trial) the parties met at the chambers of Adv Williams SC, as previously arranged. Present was Adv Williams SC, Mr Basson, Mr Magolego, the applicant, his son and his wife. During the pre-trial meeting the applicant actively took part in making settlement proposals.

[16] During the negotiations the applicant proposed a 50% risk discount instead of a 30% risk discount, where after the parties applied a 40% risk discount, apparently meeting each other halfway. In corroboration thereof Mr Basson made handwritten notes working out the figures on a 40% risk apportionment, which were attached to the answering affidavit. The respondent accepted a 40% risk discount and thereafter indicated that he wished to pay the amount in instalments of R20 000,00 per month. Mr Magolego proceeded to dictate a letter of acceptance over the telephone to his secretary, which was forwarded to Adv Williams SC and handed up at the calling of the roll to Hartzenberg ADJP, confirming that the draft order be made an order of Court.
[17] Attorney Basson as well as Adv Williams SC made depositions and confirmed that the Court order that was made accorded with the agreement which had been reached. The following words of Adv Williams SC are of particular significance:

“ I confirm that the second respondent was personally involved in the settlement negotiations to the point that a counter-offer was made by him entailing that the capital amount of R418 870,04 would be paid in instalments of R20 000,00 per month. Furthermore, second applicant was present when his attorney, Mr Magolego, dictated a letter of acceptance to his secretary and at no stage voiced his disapproval with the settlement that had been reached. I am therefore flabbergasted by the allegations made that the matter was settled without the second respondent’s consent.” (emphasis added)

Mr Magolego, the erstwhile attorney of applicant, sent the following letter, which was attached by attorney Basson:

“ I can only frankly state that I acted in accordance with my mandate and should any party suggest otherwise they may approach my professional association for relief.”