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IN THE KWAZULU-NATAL HIGH COURT, DURBAN

REPUBLIC OF SOUTH AFRICA

CASE NO.16100/2008

DR. LUCKY MALEVU APPLICANT

and

CLEAR TRADE 102 CC RESPONDENT

JUDGMENT Delivered on 26 November 2009

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SWAIN J

[1] Before me are two applications in which the applicant sought the stay of a warrant of execution issued in pursuance of a default judgment granted in favour of the respondent on 03 April 2009, and an order rescinding the judgment.

[2] The need for the grant of an order staying the warrant of execution fell away on the 19 May 2009, when the respondent furnished the applicant with an undertaking, not to execute on the judgment, pending the outcome of the rescission application. The only remaining issue in this application is the legal costs.

[3] Mr. Khan, who appeared for the applicant, based his argument for a rescission of the judgment on Rule 42, as well as Rule 31 of the Uniform Rules of Court.

[4] As regards the argument based upon the provisions of Rule 42, Mr. Mossop, who appeared for the respondent, submitted that this Rule had no application on the facts of this case. This was because the judgment was not “erroneously sought or granted”, within the meaning of this term, as contained in the Rule.

[5] It is clear that an order or judgment is erroneously granted if there was an irregularity in the proceedings

De Wet v Western Bank Ltd.

1979 (2) SA 1031 (A) at 1038D

[6] From the affidavit filed by the respondent, in opposition to the application to stay execution, the following emerges:

[6.1] Notice of bar in respect of the failure by the applicant to deliver its plea was served on 17 March 2009.

[6.2] The applicant had, in terms of Rule 26, five days within which to deliver its plea, which was then due at close of business on 24 March 2009.

[6.3] On 23 March 2009 the applicant’s representative requested an extension of time until 31 March 2009, which was not acceded to.

[6.4] On 25 March 2009 the request for an extension of time until 31 March 2009 was again made on behalf of the applicant, which was agreed to by the respondent’s attorney by way of a letter

dated 26 March 2009, in which he stated the following:

“I have taken instructions from client and confirm that we will grant you an indulgence until 31 March 2009 to file your plea.

Should the plea not be filed on 31^st instant we will go ahead with the default judgment.”

[6.5] The plea of the applicant was not delivered on 31 March 2009.

[6.6] Default judgment in favour of the respondent was entered on 03 April 2009.

[7] Mr. Khan argued that the respondent had accordingly failed to afford to the applicant, the requisite five days notice of its intention to apply for default judgment, as required by Rule 31 (5) (a).

[8] The reply of Mr. Mossop to this argument was that the applicant had been given notice by way of the letter dated 26 March 2009, that if the applicant did not file its plea by 31 March 2009, default judgment would be applied for. This was granted on 03 April 2009 and the applicant was accordingly given notice in excess of that required by the Rule.

[9] In resolving this dispute, it is necessary to consider precisely what the Rule says, which is the following:

“Provided that when a defendant is in default of delivery of a plea, the plaintiff shall give such defendant not less than five days notice of his or her intention to apply for default judgment.”

[10] In the case of a failure by a defendant to deliver a notice of intention to defend, no such notice is required.

Rule 31 (5) (a)

[11] The reason for the distinction appears to be obvious. In the case of a failure to deliver a notice of intention to defend, no notice is required, because the defendant has offered no opposition to the plaintiff’s claim. However, in the case of a failure to deliver a plea, the defendant has clearly indicated such opposition, but has failed to indicate the grounds for doing so. The object in affording notice to a defaulting defendant, must be to afford to the defendant an opportunity to uplift the bar, in terms of Rule 27.

[12] Granting a defendant the requisite five day notice as from the date when a defendant is barred, therefore has an important function.

[13] In the present case, the respondent did not give the applicant five days notice of its intention to apply for default judgment, as from the date when the applicant was in default of delivery of its plea, being 31 March 2009. The notice by the respondent was to the effect that if the applicant failed to deliver its plea by 31 March 2009, default judgment would be applied for, without specifying when this would occur. On this basis, three days of the five day notice period required by Rule 31 (5) (a) had already expired by 31 March 2009, effectively allowing the applicant only two days within which to apply to uplift the bar, contrary to the provisions of the Rule.

[14] Mr. Mossop’s answer to this approach was to submit that the parties, by agreeing to extend the time within which the applicant could file its plea, had taken the matter outside the ambit of the Rules, including Rule 31 (5) (a). The respondent was, so the argument went, accordingly not bound to give the applicant the requisite five day notice. I disagree. By so agreeing, the parties acted in accordance with the provisions of Rule 27 which provides that

“In the absence of agreement between the parties the Court may upon application on notice and on good cause shown make an order extending or abridging any time prescribe by these Rules …..”

[15] In the result, in the absence of the requisite five day notice by the respondent to the applicant of its intention to apply for default judgment, the judgment was erroneously granted in the absence of the applicant, in terms of Rule 42. It is accordingly unnecessary for the applicant to establish “good cause” for the rescission of the judgment.

Mutebwa v Mutebwa

2001 (2) SA 193 (Tk) at 199 E - H

[16] As regards the application to stay execution, as pointed out above, the only issue is that of the costs of the application. The following facts are relevant to this determination:

[16.1] The applicant’s attorney erroneously believed that Rule 49 (11) (a) automatically suspended the operation of a writ, pending the finalisation of an application to rescind the judgment, upon which the writ was based. This belief was erroneous by virtue of the decision in

United Reflective Converters (Pty) Ltd. v Levine

1988 (4 SA 460 (W) at 463 B - F

[16.2] In the absence of the consent of the other party, an application to court is necessary to suspend the writ, pending an application for rescission of the judgment.

United Reflective Converters supra at 464 A - B

[16.3] Despite the erroneous belief of the applicant’s attorney, the applicant’s attorney, by way of a letter dated 13 May 2009 to the respondent’s attorney, stated the following:

“In light of the pending application for rescission, kindly advise if you will still be persisting with the writ, as if you are, an appropriate application will have to be brought”.

[16.4] The response of the respondent’s attorney, by letter dated 13 May 2009, was as follows:

“We are prepared to advise our client to stay the execution of the warrant upon your client putting up sufficient security for the value of the judgment”

[16.5] The reply of the applicant’s attorney, by way of a letter dated 14 May 2009, was to reiterate its stance that Rule 49 (11) had the effect “as a matter of law” that the writ may not be executed.

[16.6] The respondent’s attorney responded by letter on the same day, suggesting that the applicant’s attorney reconsider their approach, read their Rules properly, and pointing out that Rule 49 (11) dealt with appeals and not rescissions of judgments.

[16.7] The response of the applicant’s attorney was to return the respondent’s attorney’s letter with a copy of Rule 49 (11) attached, with an annotation in manuscript on the letter reading “Please refer to attached Rule”.

[17] It is obvious from the aforegoing that the respondent’s attorney was aware of the decision in the United Reflective Converters’ case supra, but the applicant’s attorney was not. Although not obliged to do so, it would have been the simplest of things for the respondent’s attorney to refer the applicant’s attorney to this case and clear up the confusion. The respondent’s attorney simply states in his affidavit that the applicant’s attorney “ought to have known” this.

[18] Because an unconditional undertaking was not given, the applicant launched the proceedings to stay execution of the writ, the need for which fell away when the undertaking, referred to above, was belatedly furnished.

[19] Mr. Mossop submits that the undertaking given by the respondent, was not an admission that the applicant was correct in asserting that the writ was automatically suspended, because as a matter law it was not. As a result he submits that the respondent is entitled to the costs of the application.

[20] That the applicant’s attorney laboured under a mistaken view of the law, at the time the application was launched, is not however the only factor to be considered. An additional factor is that the applicant sought an undertaking from the respondent before launching the application, which was responded to by a request for security by the respondent’s attorney. Only after the proceedings had been launched, was an unconditional undertaking furnished.

[21] On the one hand the respondent was entitled to compel the applicant to launch the application, but on the other, it would have been the simplest of matters to refer the applicant’s attorney to the authority in question, and furnish the requested undertaking at the outset, in view of the pending application for rescission, rather than waiting until a late stage in the proceedings.

[22] Regard being had to all of these factors, and in the exercise of my discretion, each of the parties should be ordered to pay their own costs, in respect of the application to stay execution of the writ.

[23] As regards the costs of the rescission application, the applicant is entitled to its costs, but not on the attorney and client scale, as sought in the notice of motion.

[24] The order I make is the following:

1. The default judgment granted in favour of the respondent, against the applicant, on 03 April 2009 under Case No. 16100/2008, is rescinded.

2. The applicant’s plea dated 31 March 2009, will stand as the plea in the action.

3. The respondent is ordered to pay the applicant’s costs in the application for rescission.

3. Each party is to pay their own costs, in the application for the stay of the warrant of execution, issued by the Registrar, as a consequence of such judgment.

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SWAIN J.

Appearances: /

Appearances:

For the Applicant : Mr. M. Khan

Instructed by : Asmal & Asmal

Durban

For the Respondent : Mr. R. G. Mossop

Instructed by : Prior & Bezuidenhout

Glenwood, Durban

Date of Hearing : 12 November 2009

Date of Filing of Judgment : 26 November 2009

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