---

Reportable: Yes / No

Circulate to Judges: Yes / No

Circulate to Magistrates: Yes / No

IN THE HIGH COURT OF SOUTH AFRICA

(Northern Cape Division)

Case no: 1199/03

Date heard: 22/03/2005

Date delivered: 22/07/2005

In the matter between:

LEON HENRY GREEN Plaintiff

and

IZAK ABRAHAM BENADE 1^st Defendant

CASPER JOHANNES REYNARDUS KRUGER 2^nd Defendant

RUDOLF STEFANUS VORSTER 3^rd Defendant

CAPITOL CONTRACTORS CC 4^th Defendant

Coram: Tlaletsi J

JUDGMENT

Tlaletsi J:

[1] This matter concerns an application for a postponement of the trial which was set down for the period 22-24 March 2005. The application is brought by the plaintiff on the basis that he is unable to proceed with the trial as he is not fully prepared due to the late and incomplete discovery of documents at the instance of the defendants. The applicant is further seeking an order of costs in his favour on the scale of attorney and client. The application is opposed by all the defendants. The application is supported by an affidavit by Mr G J Tereblanche (“Tereblanche”) who is the applicant’s attorney of record. The defendants have not filed any affidavit but rely on the detailed heads of argument which were according to Advocate Knoetze for the defendants, prepared in anticipation of this application.

2. From the pleadings in casu it appears that on 29 September 2000 the plaintiff entered into a written sale agreement with the defendants in terms whereof the plaintiff purchased from the defendants an interest in the fourth respondent (“the close corporation”). As part of the purchase price the plaintiff was to pay an amount of R 600 000-00 which was paid in part payments of R 500 000-00 and R 100 000-00 respectively. It was a further term of the agreement, inter alia, that the plaintiff shall from the date of signing of the sale agreement, be in full service of the close corporation for it to achieve its objective, and none of the parties shall undertake any business which is in conflict or competition with the business of the close corporation.

2. The parties further entered into a joint venture agreement on 29 September 2000 with the close corporation. The terms of this agreement are fully set out in annexure ‘B’ to the particulars of claim.

2. The plaintiff has instituted an action against the defendants for, inter alia, the repayment of the amount of R 600 000-00, on the basis that the defendants have repudiated, which repudiation the plaintiff has allegedly accepted, the terms of both agreements. The defendants in their defence have pleaded that it is the plaintiff that has breached the terms of the agreement and in compliance with the penalty clause of the agreement, are entitled to retain the amount of R 600 000-00 to represent damages suffered. The breach of the agreement alleged by the defendants, relate to the services rendered by the plaintiff to the Ga-Segonyana Municipality which services are said to be in conflict or in competition with the business of the close corporation. In the replication, the plaintiff has contended that the services to the Ga-Segonyana Municipality were rendered in compliance with the General Machinery Regulations issued in terms of Act 85 of 1993, and further that the services were rendered during the plaintiff’s spare time, which in their view does not amount to breach of the agreement. In the alternative, and in the event the court finding that the plaintiff has acted in breach of the agreement, the latter has pleaded the provisions of Conventional Penalties, Act 15 of 1962 and prayed that it will be fair and just that the damages suffered by the defendants be reduced to an amount considered to be fair and just by the court in the circumstances.

3. The following facts are common cause or not in dispute.

1. On 28 May 2004 the plaintiff served a notice in terms of Rule 35(1) on the defendants’ attorneys.

2. On 25 June 2004 the plaintiff served a notice in terms of Rule 37 on the defendants’ attorneys requesting a pre-trial conference to be held on 28 July 2004.

3. On 28 July 2004 none of the defendants or their legal representatives attended the pre-trial conference.

4. On 13 August 2004 plaintiff’s attorneys addressed a letter to the defendants attorneys, in which they confirmed that there was no appearance from their side at the pre-trial conference, and requesting their Discovery Affidavit by the 23^rd August 2004 failing which they will approach the court for assistance.

5. On 17 August 2004 plaintiff’s attorneys served a request for further particulars for purposes of trial.

6. On 6 September 2004 plaintiff’s attorneys addressed a letter to the defendants’ attorneys requesting a response to the request for further particulars as well as the discovery affidavit by the 15^th instants, failing which further steps will be taken.

7. On 1 November 2004 plaintiff’s attorneys send a further letter to the defendants attorneys indicating that they have not yet received the Discovery Affidavit as well as a reply to the request for further particulars and, gave them notice that unless they receive these documents by 12 November 2004, they will take further steps against them.

8. On 23 November 2004 a further reminder was sent to the defendants attorneys by the plaintiff’s attorneys, referring to the letter of 1 November 2004, as well as the outstanding reply to the request for further particulars for purposes of trial.

9. On 10 February 2005 the defendants served their Discovery Affidavits on the plaintiff’s attorneys.

10. On 15 February 2005 the plaintiff served an application to compel the defendants to furnish further particulars on or before 1 March 2005 and that leave be granted to the plaintiff to approach the court on the same papers as supplemented, to strike the defendants’ defence plus costs. This application was set down for hearing on 18 February 2005.

11. On 16 February 2005 plaintiff served a notice in terms of Rule 35(3) requesting the defendants to discover and make available for inspection specified documents. A Notice in terms of Rule 37 calling for a pre-trial conference to be held on 21 February 2005 at 15h00 was served on the defendants’ attorneys. This conference did not take place.

12. On 17 February 2005 the defendants filed their reply to the plaintiff’s request for further particulars as well as a request for further particulars and a list of questions in terms of Rule 37(4).

13. On 18 February 2005 the application to compel was postponed sine die and costs to stand over for later determination.

2. What appears to be the plaintiff’s main cause of complaint relate to the Rule 35(3) notices. The first notice was served on the defendants’ attorneys on 16 February 2005. This was, according to Tereblanche, after he had gone through the defendants’ Discovery Affidavit which was served on 10 February 2005 and noticed that it was incomplete. A second notice in terms of Rule 35(3) was served on 8 March 2005. According to Tereblanche he identified certain documents after perusal of the documents he received from fourth defendant’s auditors in response to a subpoena duces tecum. The plaintiff specified the following documents in his second notice in terms of Rule 35(3).

“1. Finansiële Jaarstate van Capitol Contractors BK vir die tydperk eindigende 28 Februarie 2002, 28 Februarie 2003 en 29 Februarie 2004.

2. Alle notule van vergaderings Capitol Contractors BK.

2. Alle Inkomstebelasting BTW en Streekdiensteraad opgawes en aanslae vir die tydperk 28 Februarie 2001 tot 29 Februarie 2004 van Capitol Contractors BK.

2. Die Eerste, Tweede en Derde Verweerders se Inkomstebelasting opgawe en aanslae ten opsigte van bovermelde belastingjare (2001-2004).”

The only time that the defendants formally responded to the plaintiff’s notice in terms of Rule 35(3) was on 17 March 2005 at 12h00. Plaintiff contends that the reply itself does not comply with the Rules and is also filed very late and close to the trial date rendering him incapable of properly preparing for the trial.

2. The defendants contented that the plaintiff is not entitled to a postponement, and should that not be the case, he should be ordered to pay for the costs of the postponement as they are not to blame for his unpreparedness. In the alternative, the defendants contend that the issue of costs should stand over for later determination by the trial court.

2. The relevant legal principles applicable in considering an application for a postponement of a trial were succinctly stated by Mohamed AJA (as he then was) in Myburgh Transport v Botha t/a SA Truck Bodies 1991(3) SA 310 (NmSC) at page 314F-315J. Those that are relevant for the purpose of this case are:-

“1. The trial Judge has a discretion as to whether an application for a postponement should be granted or refused (R v Zackey 1945 AD 505).

2. That discretion must be exercised judicially. It should not be exercised capriciously or upon any wrong principle, but for substantial reasons. (R v Zackey (supra); Madnitsky v Rosenberg 1949 (2) SA 392 (A) at 398 - 9; Joshua v Joshua 1961 (1) SA 455 (GW) at 457D.) H

3. …

4. …

5. A Court should be slow to refuse a postponement where the true reason for a party's non-preparedness has been fully explained, where his unreadiness to proceed is not due to delaying tactics and where justice demands that he should have further time for the purpose of presenting his case. Madnitsky v Rosenberg (supra at 398 - 9).

6. An application for a postponement must be made timeously, as soon as the circumstances which might justify such an application become known to the applicant. Greyvenstein v Neethling 1952 (1) SA 463 (C). Where, however, fundamental fairness and justice justifies a postponement, the Court may in an appropriate case allow such an application for postponement, even if the application was not so timeously made. Greyvenstein v Neethling (supra at 467F).

7. An application for postponement must always be bona fide and not used simply as a tactical manoeuvre for the purposes of obtaining an advantage to which the applicant is not legitimately entitled.

8. Considerations of prejudice will ordinarily constitute the dominant component of the total structure in terms of which the discretion of a Court will be exercised. What the Court has primarily to consider is whether any prejudice caused by a postponement to the adversary of the applicant for a postponement can fairly be compensated by an appropriate order of costs or any other ancillary mechanisms. (Herbstein and Van Winsen The Civil Practice of the Superior Courts in South Africa 3rd ed at 453.)

9. The Court should weigh the prejudice which will be caused to the respondent in such an application if the postponement is granted against the prejudice which will be caused to the applicant if it is not.

10. Where the applicant for a postponement has not made his application timeously, or is otherwise to blame with respect to the procedure which he has followed, but justice nevertheless justifies a postponement in the particular circumstances of a case, the Court in its discretion might allow the postponement but direct the applicant in a suitable case to pay the wasted costs of the respondent occasioned to such a respondent on the scale of attorney and client. Such an applicant might even be directed to pay the costs of his adversary before he is allowed to proceed with his action or defence in the action, as the case may be. Van Dyk v Conradie and Another 1963 (2) SA 413 (C) at 418; Tarry & Co Ltd v Matatiele Municipality 1965 (3) SA 131 (E) at 137. ”

2. In Ferreira v Endley 1966(3) SA 618(E) the defendant sought a postponement of the matter which was set down for trial in the basis that the plaintiff had made a late and incomplete discovery there is no onus on the party seeking a postponement to satisfy the court that he will be prejudiced.

“The onus is on the party making the late discovery to show that there will be no prejudice (Maeder v Carnes, 1944(1) P.H. F 18), and in considering the question of prejudice it should be borne in mind that

“the party on whom the affidavit was served was entitled to a proper opportunity of considering the documents, reading the affidavits, comparing the documents in his possession so as to make a case, if possible, that there were further documents in existence which should have been disclosed, and to deliberate whether the Court should be moved to order a further and better discovery”

Meader v Carnes, supra, and Industrial Machinery Supplies (Pty.) Ltd Fourie, 1961(1) SA 163 (O).” (at p621E-G).

10. Given the fact that it is not in dispute that a reply to the plaintiff’s Notice in terms of rule 35(3) which was served on 16 February 2005 was only responded to on 17 March 2005, it remains to be determined what reasons have been advanced by the defendants for their failure to comply with the rules. As pointed out, the defendants elected not to file an affidavit setting out the factual background of the matter but relied on the arguments set out in the heads of argument. The only factual argument presented is that in cases where the parties live far from the seat of the court, and where the response to a Rule 35(3) notice was not signed, it constituted substantial compliance, and the court should condone the failure to comply strictly with the rule. In this regard I was referred to Copalcor Manufacturing (Pty) Ltd and Another v GDV Hauliers (Pty) Ltd (formally GDC Hulers CC) 2000 (3) SA 181 (W) at page 189D-I. In my view this contention is far from explaining why the response was served late. It does not explain why, despite reminders from the plaintiff that a response is outstanding, the unsigned discovery affidavit as well as the letter were only served on 10 March 2005. To the extent that the defendants would seek to reply on the unfortunate motor collision in which Mr. Haddad (who was handling the matter on behalf of the defendants) was involved, I fail to understand why it would only take Ms A E Pienaar to respond by letter on 10 March 2005 despite the letters sent by the plaintiff’s attorney. Furthermore Mr. Haddad’s circumstances have never been raised before by the defendants as a reason for their failure to comply with the Rules. Even if I were to accede to a request to condone the late response to Rule 35(3) as argued, the effect thereof on the plaintiffs’ preparation for trial cannot be wished away.

11. In dealing with the plaintiffs Rule 35(3) notice served on 16 March 2005, Mr. Knoetze argued that the financial statements referred to in items 3 and 4 thereof, of the year ending 28 January 2002 have been discovered by the plaintiff himself on 12 January 2005. He further argued that item 3 which relate to Income Tax and Regional Services Council Returns was discovered as item 5 and item 70 of the fourth Defendant’s Supplementary Discovery Affidavit served on 10 March 2005. He argued further that item 4 sought the discovery of items that are not discoverable. The financial statements for the year ending 29 February 2004, he argued, could not be discovered as they were not available and a draft was only made available by the auditors on 21 March 2005. With regard to the minutes of the meetings requested he argued that Ms A E Pienaar had already responded in the letter dated 10 March 2005 that such minutes do not exist.

11. In the Rule 35(3) notice the defendants were called upon to make available for inspection in accordance with sub-rule (6) the listed documents, or to state on oath within 10 days that such documents are not in his possession in which event they should state their whereabouts if known to them. The defendants did not do any of the things they were called upon to do, but instead searched for some factors in the entire process to present as excuses for their failure to comply with the rules of this court. Had it been the defendants view from the beginning that they are not entitled to discover and make available for inspection certain information, or that they are not in possession of any documentation, including the financial statements as well as the minutes, they were supposed to have followed the prescribed procedure in responding to Rule 35(3) notice. A letter by Ms A E Pienaar is not sufficient and the explanation that it constitute substantial compliance is in my view unfounded, more so that its contents regarding the existence of the minutes has been contradicted by the formal response to the Notice in terms of Rule 35(3) dated 17 March 2005.

11. Argument was further raised that the plaintiff has been involved with the fourth defendant for a considerable period of time and as a result the documents requested by him such as the minutes and particulars relating to the fourth defendant, are supposed to be within his knowledge or he could have obtained these documents from the Registrar of Companies, and that some of the information relating to the documents already appears from the pleadings. This argument does not at all assist the defendants. These remarks were not formally or otherwise forwarded to the plaintiff to enable him to take the next step in accordance with the Rules to protect his rights. It is not necessary to determine at this stage whether the plaintiff is entitled to the information requested. What is in issue is the fact that the conduct of the defendants in dealing with the plaintiff’s formal requests, has prejudiced the plaintiff in that he found himself not being properly prepared for the trial. To argue that the plaintiff is also to blame by not lodging an application to compel a long time ago and that he left the preparation until late and only accelerated his preparation at a late stage are not sufficient grounds to justify the defendants’ conduct. In my view the applicant did not cause any delay and did what he could under the circumstances.

11. In my view the plaintiff has placed before the court sufficient information that he is not fully prepared to proceed with the trial, and the reasons advanced justifies his entitlement to a postponement. The defendants have not succeeded to establish that their conduct did not prejudice the plaintiff. It is for the above reasons that I granted a postponement of the matter on 22 March 2005.

11. What remains is the question of costs. To leave the issue of costs for determination by the trial court will be to unnecessarily burden the trial court on issues that already exist at this stage, which will neither change nor depend on the outcome of the trial. This court is in my view in a better position than the trial court to decide this issue, given the developments that led to the application for a postponement. Full argument relating to the postponement of this matter has been presented and it will be costly for the parties to re-open the matter and present the same argument at a later stage.

11. I see no reason why should the plaintiff who has successfully obtained the relief he claimed not be entitled to his costs. I am not of the view that such costs should be on a punitive scale as suggested by Mr. Van Niekerk. Although I find that the defendants were negligent in the conduct of this matter, I am not of the view that their negligence is of such high degree to justify a punitive and exceptional order asked for. In exercising my discretion I am convinced that, the plaintiff is entitled to costs occasioned by the postponement on a party and party scale.

Order

The defendants are ordered to pay the plaintiff’s costs occasioned by the postponement of the matter on 22 March 2005 including the costs of the opposed application for a postponement on party and party scale jointly and severally the one paying the other to be absolved.

_______________

L P TLALETSI

JUDGE

(NORTHERN CAPE DIVISION)

On behalf of the Plaintiff: Adv. J. Van Niekerk SC

Duncan & Rothman

On behalf of the Defendants: Adv. B. Knotze

Elliott, Maris, Wilmans & Hay

---