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REPUBLIC OF SOUTH AFRICA

IN THE HIGH COURT OF SOUTH AFRICA

GAUTENG LOCAL DIVISION, JOHANNESBURG

 

CASE NO:2022-027451

(1)  REPORTABLE: YES/NO

(2)  OF INTEREST TO OTHER JUDGES: YES/NO

(3)  REVISED: YES

22 JANUARY 2025

 

In the matter between:

 

BEST DRIVE HOLDINGS (PTY) LIMITED                         First Applicant/ Plaintiff

NV CAPITAL (PTY) LIMITED                                             Second Applicant/ Plaintiff

and

MARTIN HENRY LEWIS                                                    Respondent/Defendant

 

JUDGMENT

 

GRAVES AJ:

 

[1]  The Applicants/Plaintiffs seek leave to appeal against my judgment dated 17 September 2024. The Applicants sought an order on motion in terms of Rule 28(4) permitting them to amend their particulars of claim. The hearing was held on 1 August 2024 and on 17 September 2024 I handed down judgment, dismissing the application to amend, with costs.

 

[2]  The pleaded claim is based upon a deed of suretyship executed in favour of the Applicants. The application heard on 1 August sought to amend the particulars of claim by alleging that an original (2018) loan agreement had been amended by a subsequent, self-standing (2019) loan agreement. The Respondent / Defendant objected to the proposed amendment on the basis that a deed of suretyship executed by the Respondent in favour of the Applicants under the 2018 loan agreement, did not provide accessory liability in respect of the obligations in the 2019 loan agreement. The judgment holds that the proposed amendment could not sustain the case that the 2019 loan agreement was no more than an amendment or variation of the 2018 loan agreement. The obstacles in the path of the proposed amendment identified in the judgment include the application of the parol evidence rule and the import of the express terms of the respective loan agreements and the suretyship. Procedurally, I found that the application for leave to amend did not adequately foreshadow admissible evidence that would raise a triable issue.

 

[3]  In the detailed heads of argument in support of the application for leave to appeal and during the application, counsel for the Applicants cited a wide range of reported judgments. Particular emphasis was placed upon the propositions that (i) an exception is not the appropriate procedure to settle questions of interpretation on which evidence may be admissible at trial and, (ii) if it is arguable that the amended pleading would be excipiable, then the proper course is to allow the amendment, permitting it to be dealt with at trial. In my judgment, I found these principles not applicable to the application to amend on the legal principles, properly applied.

 

[4]  In particular, I found that where a party seeks leave to amend, and contends that a written agreement should be interpreted with reference to evidence led at trial, must foreshadow in the application to amend, the evidence that will be adduced. The Applicants’ affidavit supporting the opposed application for amendment fails to do this, relying rather on generalised references to the principles of interpretation.

 

[5]  Nevertheless, during the argument counsel for the Applicants referred me to the recent judgment of the Constitutional Court in Villa Crop Protection (Pty) Ltd v Bayer Intellectual Property GmBH.^[1] Writing for the majority, Justice Unterhalter analysed the basis of a judgment by the Commissioner of Patents which had dismissed an application to amend on the basis that it was not in the interests of justice to embark on an enquiry into the application for leave to amend. When considering whether the jurisdiction of the Constitutional Court was engaged, he pointed to an error in the minority judgment of the Court which had held that the Commissioner’s misapplication of the law did not engage the jurisdiction of the Constitutional Court. No, said Justice Unterhalter, what the Commissioner had done was to adopt an incorrect legal standard to decide the application for leave to amend, which is an error of law and not a misapplication of the law.^[2] The learned Justice went on to refer to the permissive principle which is to the effect that amendments are always allowed, unless they are sought in bad faith or would cause an injustice that cannot be remedied by an award of costs. But importantly, it was cautioned that the permissive principle is not without limits and that pleadings that are excipiable afford grounds for refusing a proposed amendment.[3]

 

[6]  I believe that I have correctly applied the legal principles to reach the finding that the application for leave to amend should be refused because it would result in an excipiable pleading. I also found, on the basis of reported authority, that an applicant for leave to amend must foreshadow the evidence that will be led at trial to result in an interpretation of the 2019 loan agreement that would sustain the amended pleading. However, if my finding is based upon the adoption of an incorrect legal standard in deciding the application to amend, then I will have made an error of law which is of no small consequence and which prevents the Applicants’ constitutional right to have a dispute resolved by application of law before a court.^[4] And an appeal court may disagree with my approach.

 

[7]  There is a further point that arose during the argument on leave to appeal. I put to the Applicants’ counsel that his clients’ remedy was simply to introduce a fresh amendment, which would not be excipiable. His response was that this was not a solution because, in the event of that further application coming before a court if opposed, my judgment would in all likelihood restrict the ability of the Applicants to persuade that later court that it should be granted leave to amend on its new amendment. Whilst I have my doubts about this proposition, I cannot with certainty say that my judgment will not unfairly restrict the Applicants’ right to introduce amended particulars of claim setting out a sustainable cause of action. Despite some doubts, I find that the appeal has a reasonable prospect of success.

 

[8]  In these circumstances, I will grant leave to appeal. Counsel for both parties were agreed that leave should be granted to the Full Court of the Gauteng Local Division.

 

[9]  It is ordered that:

1.  Leave to appeal against the whole of the judgment and order dated 17 September 2024 is granted to the Full Court of the Gauteng Local Division, Johannesburg;

2.  Costs of this application are to be costs in the appeal.

 

N.J. GRAVES

Acting Judge of the High Court of South Africa

Gauteng Local Division Johannesburg

 

APPEARANCES:

 

Date of application:                              27 November 2024

 

Date of judgment:                                22 January 2025

Counsel for Applicants/Plaintiffs:         J W Steyn (with W G Pretorius)

Instructed by:                                       L M Du Toit Inc

                                                            Mr M Du Toit

 

Counsel for Respondent:                     S L P Mulligan        

Instructed by:                                       Nixon & Collins Attorneys

                                                            S D Collins

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