IN THE HIGH COURT OF SOUTH AFRICA, FREE STATE DIVISION, BLOEMFONTEIN LEKALE, J

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1 .. IN THE HIGH COURT OF SOUTH AFRICA, FREE STATE DIVISION, BLOEMFONTEIN Reportable: Ye/NO Of Interest to other Judges: Eel'NO Cirulate to Magistrates: a'ino In the matter between: NGAKA DAVID KHOKHO and NEDBANK LIMITED of whih MFC is a division) Case No.: 4715/2016 Appliant Respondent CORAM: LEKALE, J ~, JUDGEMENT: LEKALE, J HEARD ON: 24 NOVEMBER 2016 DELIVERED ON: 8 DECEMBER 2016 BACKGROUND AND INTRODUCTION [1] On or about 15 Otober 2013 the appliant and the respondent onluded a written instalment sale agreement in terms of whih the latter, as the seller, sold a 2013 Jaguar XF

2 ./ i4 luxury motor vehile to the former. It was a term of the agreement that appliant would pay the purhase prie, inlusive of VAT, by way of 71 equal monthly instalments of R11 909,65 from 1 Deember 2013 to and inluding 1November2019. [2] Appliant, however, fell in arrears with monthly instalments and on 16 August 2016 respondent notified him of the default, as required by setion 129 read with setion 130 of the National Credit At, 34 of 2005 "the Af'), per registered post. On 19 August 2016 the Post Offie whih serves the appliant's hosen postal address dispathed the first notifiation to ollet the registered item in question to him. [3] On 31 August 2016 the respondent issued summons against the appliant, inter alia, notifying him of anellation of the ontrat and laiming the return of the vehile purhased. The summons was served per affixation by plaing a opy in the post box at the appliant's hosen domiilium itandi et exeutandi on 5 September [4] Appliant only reeived the setion 129 notie on 6 September Summons was, in turn, only reeived by him on 23 September 2016 around 14h00 from a neighbour into whose post box it was plaed. Appliant immediately proeeded to prepare and draft a notie of intention to defend whih he served on the respondent's attorneys at about 15h45 the same day. He, unfortunately, ould not file the original opy with the Registrar of this ourt until Monday the

3 . 3 26th September 2016 beause the relevant setion had already losed for the day. Unknown to him, when he eventually filed with the Registrar, judgment had already been entered against him by default on 23 September 2016 l [5] On 26 September 2016, after entering appearane to defend with the Registrar, the appliant phoned the respondent's employee dealing with litigations in Pretoria and informed her that he deposited R20 000, 00 towards learane of arrears of R35 602, 00 on 24 August 2016 but was told to effet a further payment of R12 000, 00 that same day and a further R3 000,00 together with his Otober instalment of R12 000, 00. He duly obliged but was aught by surprise on 4 Otober 2016 when the respondent's said employee told him that the respondent's loal attorneys had already taken judgment by default and that they had also issued a warrant of delivery of the relevant motor vehile. [6] Appliant proeeded to ontat respondent's attorneys and learnt that they were not longer interested in the settlement of the arrear amount but wanted the whole outstanding balane paid. Whilst talking to the said attorneys the sheriff arrived with the warrant to repossess the motor vehile but same was with his wife at Kroonstad where she works. [7] Feeling that the matter was urgent as he stood to lose the vehile, appliant launhed the instant appliation on an urgent basis moving for, inter a/ia, stay of the relevant warrant and resission of the default judgment.

4 4 [8] Respondent filed opposing papers and on 6 Otober 2016 the motion was postponed to 24 November 2016 with osts standing over for adjudiation at a later stage. [9] The matter now serves before me for determination of the resission appliation and osts of the postponement only with the parties, effetivelyt being in agreement that, in law, servie of an appliation for resission of judgment automatially stays the exeution proess. ISSUES IN DISPUTE [1 O] The parties are at loggerheads over whether or not appliant has a bona fide defene to respondent's ation with the respondent effetively oneding, m argument, that appliant's explanation for his default in entering appearane to defend is aeptable and plausible while the appliant, on his partt ontends that the ation was instituted prematurely and ontrary to the provisions of setion 129 of the At insofar as summons was issued before he ould reeive the relevant letter of demand. [11] The dispute between the parties, further, extends to the question as to whether or not, in law and equity 1 the appliant falls to be burdened with osts oasioned by the postponement on the sth Otober 2016.

5 5 DEPOSITIONS AND CONTENTIONS FOR AND ON BEHALF OF THE APPLICANT [12] In support of the appliation the appliant deposed to, inter a/ia, the effet that he would be able to re-instate the relevant redit agreement by paying the outstanding default harges and osts of enforing the agreement if the ourt were to resind the impugned judgment insofar as he has already leared the arrears on the aount save for appliable default harges and osts. [13] In argument on the papers and before the ourt the appliant, inter alia, ontends that it is patent from the founding affidavit that he always intended to defend the matter beause he prepared and drafted the notie of intention to defend immediately upon reeipt of the summons. It is, further, his submission that the respondent issued summons against him before the expiry of the ten10) business day period after delivery of the setion 129 notie. Aording to him ase law is to effet that the respondent was obliged to ensure that the relevant notie, in fat, ame to his attention, as the defendant, before it ould issue summons. [14] In the appliant's view he was not afforded an opportunity to exhaust the remedies provided by setion 1291) of the At before ation was instituted against him. DEPOSITIONS AND CONTENTIONS FOR AND ON BEHALF OF THE RESPONDENT

6 , 6 [15] In opposition to the appliation, the respondent's Manager: Speialised Support and Litigation deposed to, inter a/ia, the effet that prior to launhing the instant appliation on an urgent basis the appliant did not engage the respondent's attorneys and, had he done so, the respondent would have given him an undertaking not to sell the vehile, as it usually does where the appliant party ommits, with its onsent, to a date for filing the resission appliation. In the respondent's view the urgeny was self-made insofar as the resission appliation automatially suspends enforement of impugned judgments. [16] The respondent's position is, further, that setion 129 notie was sent to the appliant on the16th August 2016 but he failed to respond to the same and was still in arrears as at 31 August 2016 when summons was issued. As at 4 Otober 2016, after further payment of R15 000,00, the appliant was still in arrears in the amount of R12 684,79. [17] In argument Mr Van Aswegen, for the respondent submits to, inter alia, the effet that the novel relief of re-instatement of the redit agreement provided for by setions 1293) and 1294) of the At is not available to the appliant beause the agreement was anelled before the appliant had leared all the arrears. The aforegoing prevails beause the high-water mark of the appliant's alleged bona fide defene is that he an re-instate the instalment sale agreement by paying arrears one the default judgment is resinded. In his view

7 7 the agreement was anelled by way of summons whih, inter a/ia, ommuniated the anellation to the appliant. _ 18] In Mr Van Aswegen's understanding of the appliant's founding papers, it is not the appliant's ase that the anellation was ineffetual for want of ompliane with setions 129 and 130 of the At. The relevant issue, he ontends, is only apparent in replying papers and, in law, the appliant stands and falls by what is ontained in his founding papers. 19] Mr Van Aswegen, further, reminds the ourt that aording to the Constitutional Court all that the redit provider, in the position of the respondent, has to do to satisfy the requirement "to deliver" the setion 129 notie in the ontext of enforing the redit agreement is to "aver and proof that the notie was delivered to the onsumer". The appliant's assertion that summons was issued prematurely is fallaious. Notie of anellation of the instalment sale agreement ontained in the summons reahed the appliant, on his own admission, on 23 September More than 1 O business days had, as suh, elapsed between delivery of the setion 129 notie and the date on whih anellation of the agreement was ommuniated to the appliant. [20) It is, further, ontended for the respondent party that the appliation should be dismissed with osts inluding reserved osts.

8 .. 8 APPLICABLE LEGAL POSITION [21] An appliation for resission of judgment, like an appliation for leave to appeal, suspends the impugned judgment and its exeution. See Uniform Rule of Court 4911) and Peniel Development Ptyl Ltd and Another v Pietersen and Others ) SA 503 GSJ) at para [5]) [22] The redit provider is, in terms of setion 129 read with setion 130 of the At, obliged to prove that the setion 129 notie reahed the orret post offie serving the address hosen by the onsumer and to aver that same was made available to the onsumer insofar as delivery is effeted when the doument is made available to the onsumer as the reipient. One the relevant averments are apparent from the redit provider's papers before the ourt, the default position is that the setion 129 notie was delivered on the date it was made available to the onsumer. See Sebola and Another v Standard Bank of South Afria and Another ) SA 142 CC) at par [77]) [23] Clause 14 read with lause 16 of the Instalment Sale Agreement between the parties dated the 15th Otober 2013 effetively provides for a setion 129 1) notie to be send to the appliant, as the onsumer, before the agreement may be anelled on grounds of default by the respondent, as a redit provider, and only upon failure by the appliant to respond to suh notie within 10 business days. See Clauses 14.2 and of the Agreement in question)

9 9 [24] Setion 1293) of the At, before its amendment and as it stood when it was onsidered by the Constitutional Court reently, permitted "a onsumer, at any time before the redit provider has anelled the agreement, to re-instate a redit agreement that is in default by paying to the redit provider all amounts that are overdue. The provision adds that the onsumer must also pay 'the redit provider's permitted default harges and reasonable osts of enforing the agreement up to the time of re-instatement". See Nkata v First Rand Bank ) SA 257 CC) at par [77]) [25] In its amended form with effet from 13 Marh 2015 setion 1293) of the At provides that: "A onsumer may, at any time before the redit provider has anelled the agreement, remedy a default in suh redit agreement by paying... all amounts that are overdue, together with the redit provider's presribed default administration harges and reasonable osts of enforing the agreement up to the time the default was remedied." [26] Where there exists no proof that the setion 129 notie reahed the orret post offie, onsumers are granted resission of the impugned default judgment and the proeedings against them get adjourned in terms of setion 1304 )b) of the At to allow the redit provider 11 to retify the omission in regard to the notie". See Sebola and

10 .. 10 Another v Standard Bank of South Afria and Another supra) at par [81]) APPLICATION OF LEGAL POSITION TO THE FACTS AND FINDINGS [27] The parties are, effetively, at variane on whether or not summons was issued before 10 business days had elapsed from the date of delivery of the setion 129 notie to the appliant, as the onsumer. The parties are ad idem that summons was issued on 31 August 2016 while the relevant notie was sanned at the orret post offie serving the appliant on 19 August The notie in question was, at the very earliest, made available for olletion by the appliant and, as suh, delivered when the first notifiation of its availability was dispathed to him on the same date. [28] The 10 business day period after the delivery of the relevant notie expired, at the very earliest, on 2 September 2016 if one exludes Saturdays and alulates the period from the 19th August In terms of setion 1291 )b) read with setion 1302) of the At no legal proeedings ould, thus, be ommened in asu to enfore the redit agreement between the parties before the 3rd September [29] Summons was, therefore, issued 3three) days too early on ommon ause fats insofar as it was issued on 31 August The evidentiary burden was generally on the appliant party, as the onsumer, to addue evidene showing that the

11 .. 11 relevant notie was, in fat, delivered to him later than the 19th August 2016 where he did not, as the ase is in the instant matter, agree with the default position in paragraph [28] above. The appliant deposed to the effet that the notie in question was delivered to him on 6 September [30] I am, however, satisfied that the default position prevails beause there exists no explanation whatsoever, on the papers, as to why the appliant only reeived suh a notie on 6 September 2016 when the notie notifying him of its availability was, admittedly, first dispathed to him on 19 August The appliant, further, oneded in argument before the ourt that, in line with the generally aepted pratie of South Afrian Post Offie, the relevant notie, as a registered item, ould not reasonably possibly have been delivered to his plae by the relevant post offie serving his area as alleged in his papers. He attributed the mistake to the haste involved in preparing the motion on an urgent basis. Rejeting his evidene in this regard as unaeptable and inluding Saturdays in the alulation of the relevant period, the 10 business day period ontemplated in setion 1302) of the At expired on 31 August 2016 at the very earliest for the respondent. Even on this generous alulation of the relevant period summons was learly issued one 1) day too early. [31] On the preeding findings alone the appliation stands to sueed in order to afford the appliant an opportunity to avail himself of onsumer rights provided by setion 129 of the At.

12 See Sebola and Others v Standard Bank of South Afria and Another supra) at par [81]. [32] The respondent's position is that the appliant has no bona fide defene beause he was notified of anellation of the redit agreement when he reeived summons on 23 September 2016, while he reeived the setion 129 notie on 6 September In the respondent's view the appliant an, as suh, not revive the agreement by paying outstanding osts beause the agreement was already anelled as at 23 September [33] I am, however, satisfied from the reading of the relevant lauses of the redit agreement whih, in any event, aord with the At, that the determinative date for the purposes of setions 129 and 130 of the At is the date on whih summons is issued and not the date of servie or reeipt of the same by the onsumer. In my judgment anellation of the ontrat, whih is ommuniated through premature summons, is not effiaious for the purposes of setion 1293) of the At for it is unilateral, by its very nature, and takes plae when it is effeted and not when it is ommuniated. In the instant matter it is expressly lear from the partiulars of laim that anellation purportedly took plae before summons was issued insofar as summons served, inter alia, to notify the appliant of the same ex post fato. Suh anellation is, as suh, as premature as the summons itself.

13 [34] It is ontended for the respondent party that the issue of prematurity of summons in relation to setion 129 notie is not apparent ex faie the appliant's founding papers and is only ontained in his reply. In the respondent's view the appellant must stand and fall by his papers and the issue must, strito senso, not be entertained by the ourt. I am, however, persuaded by the papers that the issue in question is properly before the ourt insofar as the dates on whih the relevant notie was dispathed and summons was issued are all apparent from the launhing papers. COSTS [35] The appliant prays for punitive osts against the respondent. I am, however, not satisfied that there exists ause for suh a speial osts order to be made regard being had to the fat that the respondent was learly, in law, entitled to oppose the appliation in irumstanes where, in its view, there existed no urgeny entitling the appliant to jump the queue for the matter to be heard out of turn. [36] I am, further, persuaded by undisputed fats before me that in the light of the fat that the appliant was in arrears as at the date of the default judgment, the respondent, at least, had ause, in law and equity, to oppose the appliation. [37] As far as reserved osts are onerned, I am satisfied that it is only fair to saddle the appliant with the same regard being

14 .. '.. I had to the prevailing legal position as per Uniform Rules of Court. ORDER [38] In the result the appliation for resission of judgment 1s granted with osts. [39] The appliant is ordered to pay the osts relating to the postponement of the 6th Otober On behalf of the appliant: In person C/O Rampai Attorneys Bloemfontein On behalf of the respondents: Adv. W. A. van Aswegen Instruted by: Mintyre & Van der Post BLOEMFONTEIN /eb

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