IN
THE COURT OF APPEAL OF SWAZILAND
APPEAL
CASE NO.56/99
In
the matter between:
D.Z.
CIVILS AND BUILDING (PTY) LTD 1st Appellant
DAVID
ZIETSMAN 2nd Appellant
VS
STANDARD
BANK OF SWAZILAND LIMITED Respondent
(Formerly
BARCLAYS BANK OF SWAZILAND LIMITED)
Coram: LEON
J.P.
VAN
DEN HEEVER J.A.
BECK
J.A.
For
the 1st Appellant and 2nd Appellant: C.S. SIMELANE
For
the Respondent: L.N. KHUMALO
JUDGMENT
Van
den Heever J.A.
In
this matter the appeal was allowed, with costs, at the hearing of the
matter, reasons to follow. They do now.
For
the sake of convenience I refer to the appellants as "the
Company" and "Zietsman" respectively, and to the
respondent as "the Bank".
The
appeal is aimed against a judgment dated 23rd July 1999, refusing
rescission of a default judgment which had been granted against the
Company and Zietsman in January of 1998. The grounds are simple:
rescission had already been granted, by consent, by Matsebula J. on
12 February 1999. The order refusing rescission had simply not been
sought by the Bank.
2
Instead
of abiding this court's decision on the appellants' seeking
cancellation of the unsought benefit which the court a quo had
bestowed on the Bank, the latter inexplicably opposed the appeal. The
grounds advanced want to put form before substance and money in the
lawyers' pockets, without achieving any object I can think of, to
benefit the Bank. Its counsel's heads are crisp. He admits that the
judgment in issue was given in an application that was never made,
having already been disposed of earlier. Therefore, he argued, the
judgment is a nullity, alternatively should be rescinded in terms of
Rule 42. It is not a matter "appropriate" for appeal. We
were not referred to any limitation on the jurisdiction of this
court, which compels a litigant in a case like this to follow another
route as being the only one available to it by which to set aside a
judgment of the High Court which was not correctly made. That the
appellants should ask for an unequivocal order with that effect, is
understandable. The conduct of the Bank towards the appellants in the
past has been sufficiently questionable for it to be strange that no
special order for costs has yet been claimed against it. The history
may be summarized as follows:
The
company had various accounts with the Bank. On 30 April 1996 Zietsman
signed a document printed in the finest font in which he bound
himself as surety and co-principal debtor for the Company's debts to
the Bank. The many clauses set out are so biassed in favour of the
Bank that the document alleges that Zietsman even renounced the
benefits of the senatus consultum velleianum and the authentica si
qua mulier - which the law did not accord him.
On
10 December 1997 the Bank issued summons against the Company and
Zietsman, jointly and severally, for-
1. payment
of E39 742-09 being the balance as at 31 October 1997 of the
Company's overdraft during 1996 and 1997, carrying interest at 31.25%
compounded monthly.
2. interest
at this rate, compounded monthly, from 1 November 1997 to date of
payment.
3. costs.
3
There
are three annexures to this summons: a page from the ledger of the
Company's current account, no 3033306, dated 1 April 1997 and
covering the period 3 August 1996 to 27 March 1997 which reflects a
debit of E46 737-46; an "interim statement" relating to
this account dated 18 November 1997, reflecting only the figure
claimed in the summons as a debit; and the "Suretyship
(guarantee)" signed by Zietsman on the 30th of April 1996. This
summons was addressed to the Sheriff or his Deputy for the district
of Manzini. We have no return of service in the appeal record, but in
the application referred to in the next paragraph Zietsman deposed to
its having been served on him in Mbabane on the late afternoon of the
15th December 1997 by the Deputy Sheriff for Hhohho.
On
13 January 1998 the Bank's attorneys signed a notice of set-down for
23 January of an application for default judgment, this notice being
filed the following day, and being prophetic: it alleged that the
time for filing notice of intention to defend, not "would
expire" but "expired", on 21 January 1998.
Judgment
in default of appearance was granted on 23 January 1998. We have no
copy of the order because the court file went astray, but learn of
its existence from the application launched on 26 January by the
Company and Zietsman for rescission of the default judgment and
interim stay of execution. They filed notice of intention to defend
on the same date. The grounds advanced in Zietsman's affidavit are
that service of the summons had been effected by the wrong person;
and that set-down had been premature since the time allowed for entry
of appearance to defend was suspended by the Court's vacation
closure. Moreover the amount claimed was far more than the company
owed, nor had any agreement been concluded that interest would be
payable at the rate of 31.25%.
The
Bank promptly gave notice that it intended opposing the application
for rescission. There is no indication that it ever filed affidavits
justifying this move and disputing the appellant's evidence that the
Bank was claiming an excessive amount and interest at an excessive
rate. On 2 February by consent Dunn J ordered that execution be
stayed pending finalization of the application.
The
Bank's next move suggests that it no longer relied on the judgment by
default it had obtained in January in terms of the summons of 10
December 1997, set out above, or even acknowledged that, or knew
whether, it had done so. It namely filed a Declaration which alleges
-
4
"In
the belief that judgement by default was granted against [the
Company] on the 23rd January 1998, [the Company] instituted
proceedings for the rescission of such judgement by notice dated 27th
January 1998 under the same case number as the present proceedings"
(my emphasis).
Why
the Bank alleges that it had obtained judgment only against the
Company and that only that entity sought rescission is equally
strange. But of importance is that in the Declaration the Bank admits
that there was merit in the appellants' criticism as voiced in the
rescission application, of its claim as formulated in the summons;
"8. Subsequent
to that contention being raised, [the Bank] has revised [the
Company's] account and annexed hereto marked "C 1" and "C2"
is a ledger record showing the credit in refund to [the Company] of
the sum of E8 877.96. The account as set out in the annexed revised
ledger statement is then based on interest charges at a fixed rate of
3% plus prime, presently 17.75% p.a.
9. In
the circumstances the amount due and payable by [the Company] to [the
Bank] and on which [the Bank's] claim is now based is the sum of
E44.136.84 as at the 27th June 1998 together with interest at 17.75%
per annum compounded monthly from 28th June 1998 to date of final
payment". (my emphasis)
The
two further annexures, C1 and C2, do not in fact show a refund of E8
877.96 at all, but of E4 127,75: the alleged difference between
interest which had been wrongly calculated at E13 005.71 - we do not
know over what period - and interest recalculated and charged. The
prayer is now for judgment jointly and severally against the company
and Zietsman, and costs against Zietsman "on the scale between
attorney and his own client including collection commission" by
virtue of one of the many clauses in the suretyship agreement, and on
the party scale against the Company.
Adding
to the costs and the confusion, the Bank then came to court on 2
September 1998 seeking summary judgment on this declaration, without
any amendment of the summons on which it purports to be based and
despite the admission that it had made mistakes in its figures in the
past, the extent of which are certainly not clarified in anything
placed before us, and despite the fact that it was already armed with
a default judgment which was the subject of an application for
rescission. The application for summary judgment, was,
understandably, opposed. Inter alia Zietsman deposed that the Bank
official to whom he had protested that interest was charged on a
basis to which the Bank was not entitled, had refused to give him a
print-out of the relevant accounts.
5
On
10 December 1998 the matter came as an opposed one before Maphalala
J. Instead of dismissing the application for summary judgment with
costs, he declined to deal with it as being premature: the
application to rescind had first to be dealt with. He made no order
as to costs. Those proceedings are not before us, but his approach
seems, with respect, to have been clearly wrong. The application for
summary judgment was not premature, it was incompetent: one cannot
ask for two judgments on the same cause of action, and the Bank was
already armed with a default judgment in its favour. Its approach to
court for summary judgment as having an unanswerable case was
moreover either inept or arrogant, in the light of its admission in
the very papers on which it sought a second judgment, that it was not
infallible, and what prima facie appear to be contradictions or
errors between the annexure and the declaration. The learned Judge
was, of course, quite correct that the pending application for
rescission could not merely be ignored and should be disposed of ante
omnia.
It
was set down as being an uncontested application for rescission of
judgment by the Bank's attorneys by notice dated the 9th, for the
12th of February 1999; and also for the same date by the attorneys
for the Company and Zietsman. The notice of the latter says what the
order sought was: for rescission of the default judgment; that writs
pursuant to the judgment be set aside; and for costs on the scale of
attorney and client.
We
do not know what happened in court on the 12th of February 1999. An
order under the seal of the registrar, with an indecipherable
signature, records that on that day by consent of the parties who
appeared before the Hon. Justice Matsebula, he ordered rescission of
the default judgment of 23 January 1998; that all writs pursuant to
that judgment be set aside; with no order as to costs. Why this order
was signed and sealed by the Registrar only on the 29th September
1999, is not explained.
The
opposed application for summary judgment was, according to Zietsman,
argued on the 26th February 1999 and judgment was reserved. Zietsman
on the 26th October 1999 deposed that, to the best of his knowledge,
judgment had not yet been given, but the Bank had issued a writ
against himself and the company, based on the default judgment
obtained on 23 January 1998. A copy of that writ, dated September
1999, is part of the record before us. It says expressly that it is
based on the judgment of 23 January 1998,
6
and
is not guilty of a mere misprint in regard to the date: the writ is
for the amounts of capital and interest as claimed initially, despite
the Bank having subsequently admitted that these were wrong. The Bank
went further and on 14 October issued a "Notice in terms of Rule
45 (13) (i) "based on that very judgment, in terms of which
Zietsman was to appear before the court on 29 October 1999 for an
inquiry into his financial affairs.
Zietsman's
testimony referred to above, is contained in an urgent application,
which should have been quite unnecessary to set aside this writ and
this notice. It was so ordered on 27 October 1999. It smacks of
either negligence or ineptitude or harrassment, to run tandem actions
based on the same summons against the opposition.
Apparently
after this latest application, the appellants for the first time
became aware of a judgment by Sapire C.J; against which the present
appeal is launched. It is the final document adding to the confusion
in the matter. It is dated 23 July 1999 but does not state on what
date it was supposed to have been heard; and according to the Notice
of Appeal against it, it was only "made available" on the
16th of November 1999. It is not a judgment in the matter in which
the Chief Justice is alleged to have reserved judgment, that is the
application in which the Bank asked for summary judgment; in which
the prospects of success are as I have suggested above, slim. It does
not deal with the application for summary judgment at all, but
refuses rescission of the default judgment of 23 January 1998. The
objection to service by the wrong deputy sheriff is brushed aside as
of no moment: Zietsman received the summons and was not prejudiced by
the irregularity. As regards calculation of the period within which
to enter an appearance, though the court was on vacation "the
only suspension effective during the prescribed period relates to the
filing of pleadings as provided for in the rule." The objection
on the merits, that Zietsman never agreed to pay interest at 31.25%,
is dismissed on the ground that Zietsman does not say what rate was
agreed. That he admits to owing money, but only E29 000, is not dealt
with at all save to be dismissed as not constituting a bona fide
defence, one does not know why. A defence to only portion of a claim
is entitled to a hearing, and the effect of this order, should it
stand, would be to grant the Bank something other than that which on
recalculation it claims to be entitled to. But it is not wrong only
in its content but in having been given at all, having been preceded
by one granted earlier by agreement between the parties granting that
very rescission which now purports to be refused.
7
I
have detailed the history preceding the appeal to underline that the
approach of appellant's counsel in opposing the appeal at all and
then on a procedural point, was a vivid example of the Biblical beam
and mote.
For
the above reasons the appeal was allowed, with costs (no special
order in regard thereto having been sought by the appellants) and the
judgment refusing rescission of the default judgment set aside.
VAN
DEN HEEVER, J.A.
I
agree
LEON,
J.P.
I
agree
BECK,
J.A.
Delivered
in open court on the 31th day of May 2000
