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683

 

DU PLESSIS v. DU PLESSIS.

 

(ORANGE FREE STATE PROVINCIAL DIVISION.)

 

1969. October 2, 17. BECK, A.J.

 

Practice. -Judgments by default. -Setting aside of. -What applicant must adduce.-Principal and agent.-When entitled to commission.-Necessary averments.

 

Whenever a party applies in terms of Rule 31 (2) (b) lo set aside a judgment granted by default he must show "good cause" as laid down in Grant v. Plumbers (Pty.) Ltd., 1949 (2) S.A. 470 (O), but if the merits of the action have been fully dealt with on the pleadings and if it appears that the prob­ abilities with reference to the existence of an alleged prima facie defence is manifestly in favour of the respondent, this is a consideration which the Court may properly take into account in imposing such stipulations as it sees fit when granting leave to an applicant to enter appearance to defend.

 

Where a purchaser undertakes -to pay the commission of the agent then the term "if the purchaser is able to purchase" should not be implied as is normally done when the seller is the party who must pay the commission.

 

Application to set aside a judgment by default. Facts of no importance have been omitted.

 

H. C. J. Flemming, for the applicant.

H.J. 0. van Heerden, for the respondent.

 

Cur. adv. vult.

 

Postea (November 17th).

 

BECK, A.J.: On 11th September 1969 this court granted judgment by default against the present applicant (then the defendant) for payment of the amount of R12,000 with interest thereon at 6 per cent per annum a tempore morae and costs of the suit.

 

The return of the Deputy Sheriff showed that the summons had been served on the applicant personally on 21st August 1969. According to the summons the applicant undertook in writing on 10th February 1969 to pay commission of R12,000 to respondent (who traded as an estate and insurance agent under the trade name of Wesselsbron Trustmaat­skappy), and this undertaking was accepted by respondent. The sum-

 

684

 

mans alleged that on a proper construction of the said undertaking, the applicant undertook to pay respondent the said commission if he should buy the farm "Trek George" from one J. J. Bezuidenhout. Further the summons alleged that on 27th February 1969, applicant and the said Bezuidenhout entered into a written contract of sale in terms of which applicant bought the said farm from Bezuidenhout at a purchase price of R245,000. In conclusion it was alleged in the sum­ mons that this deed of sale of 27th February, 1969 contained the following clause, viz.:

 

"The seller shall pay no sale commission to the firm Wesselsbron Trustmaat­skappy who brought about the sale, but the purchaser undertakes to pay the said firm's compensation as undertaken by him."

 

This clause referred to the undertaking of 10th February 1969 which was accepted on behalf of respondent by her husband and properly authorised representative, Mr. L. J. du Plessis.

 

On the evening of 2nd October 1969 applicant approached the Court by way of an urgent ex parte application in terms of which he prayed for an order which:

 

"(a) sets aside the judgment in respondent's favour on 11th September, 1969 in case No. 778 / 1969;

 

(b)      authorises applicant to enter appearance to defend that action;

 

(c)       ……………………………………………………………………………..

 

(d)       ……………………………………………………………………………..

 

(e)      The Deputy Sheriff for the district of Wesselsbron is ordered and authorised not to proceed with the sale in execution advertised for 3rd October, in terms of the warrant in. favour of respondent in the said action, or with any other sale in terms of such warrant, pending the final decision in respect of prayers (a) and (b), and not to pay to respondent any portion of the proceeds of any sale in execution against applicant, pend­ ing the final decision in prayers (a) and (b) above,"

 

After hearing Mr. Flemming on behalf of applicant, I issued a rule nisi calling on respondent to show cause on 30th October 1969 why there should not be an order in terms of prayers (a) and (b), and I further ordered that the rule nisi act as a temporary interdict prohibiting the Deputy Sheriff of Wesselsbron from proceeding with the said sale in execution pending the final decision on the application.

 

In support of his ex parte application, applicant made an affidavit in which the following allegations appear:

 

[The Honourable Judge dealt with the allegations and proceeded as follows.]

 

In terms of Rule 31 (2) (b) the Court can set a judgment by default aside with such conditions as it sees fit if the defendant applies therefore within 21 days of such judgment coming to his notice and shows "good cause”. What is meant by "good cause" was dealt with by BRINK, J. (as he then was), in the case of Grant v. Plumbers (Pty.) Ltd., 1949 (2) S.A. 470 (0) at p. 476 in the following terms : "………."

 

685 A

 

With respect, I agree with this formulation of what must be shown by an applicant who wishes to rely on Rule 31 (2) (b). I however wish to add that if the merits of the action have been fully dealt with in the pleadings as happened in the present case, and if it should appear that the probabilities in respect of the existence of an alleged prima facie defence are manifestly in favour of the respondent, this is a consideration which the Court may properly take into account in imposing such stipulations as it sees fit when granting leave to an applicant to enter appearance to defend.

 

After submission of voluminous opposing and replying statements, Mr. van Heerden, for respondent, argued on the return day of the rule nisi that the application is defective in respect of all three of the above aspects of "good cause" which must be shown by applicant. It will be convenient to deal first with the last of the said requirements, viz. with the question whether a prima facie defence to respondent's action has been shown.

 

[The Honourable Judge analysed the allegations and proceeded as follows.]

 

Next I will deal with Mr. Flemming's submission that applicant is not bound by his undertaking because he, as purchaser, was not able to purchase.

 

As already mentioned herein the applicant's liability rests on the written undertaking signed by him on 10th February 1969 and repeated in the contract of sale on 27th Feburary 1969. I have already quoted the wording of this repetition at the start of the judgment. The relevant portion of the undertaking of 10th February reads:

 

"Hereby I confirm that:

 

1.       I am purchasing the farm Trek George, district Wesselsbron from J. J. Bezuidenhout through the firm Wesselsbron Trustmaatskappy.

 

2.       I will pay commission of R12,000 to the firm Wesse!sbron Trustmaat­ skappy;"

 

This undertaking given to and accepted by the estate agent who had the sole right to sell the farm for 30 days (as will appear later) is un­ conditional in form, and the first question which arises is whether an implied term such as "if I am able to conclude the sale" should be added to this unqualified undertaking. The correct approach in such cases was set out as follows by MILLER, J., in John H. Pritchard and Associates (Pty.) Ltd. v. Thorny Park Estates (Pty.) Ltd., 1967 (2) S.A. 511 (D) at pp. 514-15: "……………………"

 

686 B

 

In the present case there is no ambiguity in the wording of the undertaking, and "linguistic construction only" leads to no problem of interpretation. The remaining question is then whether the Court must imply a term such as "if the purchaser is able to purchase" in the case where the purchaser undertakes to pay the agent's commission, as is usually done when the seller is the party who has to pay the commission. (See Roux v. Schreuder, 1969 (3) S.A. 616 (0) at pp. 620G-21A and the cases quoted there).

 

Mr. van Heerden argued that when it is the purchaser who undertakes to pay commission to the estate agent, completely different considerations apply, which have the result that it is not necessary to imply the said term and in my opinion Mr, van Heerden is correct. Where, for example, a seller gives an estate agent a mandate to find a purchaser who is willing and able to purchase, it has, as far as I know, never been suggested that it is an implied term of his mandate that he himself (the seller) is able to sell. If, in such a case, the agent finds a willing and wealthy purchaser, and a contract of sale is entered into, the agent will be entitled to payment of his commission by the seller even if it appears that when the contract of sale is entered into, the seller was, for some or other reason unbeknown to the agent, not able to sell the property. So too the purchaser must surely know whether he can fulfil his obligations, and by the very fact that he buys he creates the impression with the agent that he can fulfil them. Should his optimism be misplaced he has only himself to blame, and there is, in my opinion, no reason why he should be freed from liability because of his inability to conclude the sale later. Consequently I come to the conclusion that applicant's undertaking to respondent is not susceptible of the implied term that applicant was capable of buying when he concluded the contract.

 

Should these conclusions be correct it would mean that applicant is in fact liable towards respondent, unless he is entitled to adduce evidence which can prove that a meaning must be given to his undertaking which does not appear from it. This he can do if he can show that the mutual intention of the parties is not reflected because of a mutual error, and that he is consequently entitled to rectification of the document. Nowhere in the pleadings can I find allegations upon which such a defence may be founded.

 

[The· Honourable Judge dealt with certain facts and proceeded as follows.]

 

687

 

Applicant's written undertaking to respondent contains no express provision which would free him from liability should he be unable to make the financial arrangements, and there is nothing to indicate that such a provision was omitted in error as a result of a mutual error on the part of the parties.

 

I therefore find that no defence of rectification either by way of specific allegations or even by way of implication has been made out in the pleadings. (Cf. Stapelberg v. Schlebusch, N.O. and Another, 1968 (3) S.A. 596 (0) at p. 602A-E).

 

Still in connection with the question whether applicant showed a prima facie defence. I can mention in conclusion that, in my opinion, it was not shown prima facie that applicant was unable to purchase at the time when the contract was concluded, even if it should have been a term of the contract that he was able. At the requested trial of respondent's action the onus of proof would naturally be on respondent to prove applicant's ability to purchase at the time of conclusion of the contract. (Look at Wacks v. Record, 1955 (2) S.A. 234 (C)). For the purpose of this application however it is at this stage for the applicant to show prima facie that this ingredient of respondent's action is missing. Applicant did not disclose his financial position to the Court, and it may be the position that, when be entered into the contract, the probability existed that he. would be able to make the financial arrange­ ments necessary to conclude the contract. Unless the applicant himself was under this impression at the time I can hardly understand bis willingness to go on with the purchase.

 

For these reasons it is my finding that applicant did not succeed in showing a prima facie defence to respondent's action and the application must consequently be refused.

 

Although this finding is sufficient to finalise the application as far as this Court is concerned, it is desirable that I give further attention to the remaining two aspects which have to be shown by applicant if he wishes to get relief in terms of the Rule.

 

[The Honourable Judge dealt with certain facts and continued as follows.]

 

All these circumstances have the result that, in my opinion, applicant did not show that there was a reasonable explanation for his default, and that I am not satisfied that he brought the application for bona fide reasons, and not merely to delay the satisfaction of respondent's claim by way of a sale in execution which had been arranged for the following day.

 

In conclusion I wish to add that even if the applicant had succeeded in proving everything which had to be proved to justify re1ief in terms of Rule 31 (2) (b), this would still be a case where the Court, in the exercise of its discretion to do so (in terms of cases such as De Jager v. Heilbron and Others, 1947 (2) S.A. 415 (W); Spilg v. Walker, 1947 (3) S.A. 495 (E); Adjust Investments (Pty) Ltd. v. Wiid, 1968 (3) S.A. 29 (0)), should set aside the rule nisi on the ground that applicant failed to display the necessary amount of good faith towards the Court when

 

688

 

bringing his ex parte ,application. Not only could the Court have been influenced to issue the order by the material allegation that the contract of sale would, according to. respondent's husband, and with applicant's and Bezuidenhout's consent, be merely provisional until the floating of the company, but I was in fact influenced thereby when granting the order. To put this at its most advantageous for applicant it was grossly negligent of him to make this allegation. Taking into account also the alleged uncertainty which allegedly arose within him concerning the precise nature of the document which was handed to him on 21st August, 1969, while it later appeared that he was in fact conversant with the contents and purport thereof, as shown above, and was aware of the fact that respondent's attitude was that only the first sale was relevant not the second, I am of the opinion that applicant obtained his ex parte order in an improper way.

 

The application is therefore refused and the rule nisi set aside. The applicant is ordered to pay respondent's costs of opposition, and it is also ordered that applicant is responsible for any wasted costs incurred by the Deputy Sheriff for the district of Wesselsbron in connection with the sale in execution which would have been held on 3rd October, 1969 in terms of the warrant issued in respondent's favour in case 778/1969.

 

Applicant’s attorneys: Chris de Wet & Son. Respondent's attorneys:

 

E. G. Cooper & Sons.

 

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