System Arch (Pty) Limited v Lekhanya and Others (CIV/T 163 of 93) [2000] LSCA 20 (28 February 2000)

-1- CIV/T/163/93 IN T HE H I GH C O U RT OF L E S O T HO In the matter between: S Y S T EM A R CH (PTY) L I M I T ED Plaintiff a nd S O P H IA L E K H A N YA P A L E SA L E K H A N YA C H R I S T O P H ER L E K H A N YA 1st 2nd 3rd Defendant Defendant Defendant For Applicants/Defendants : M r. M . T. Matsau For Respondent/PlainnfF : M r. K. M o h au J u d g m e nt Delivered by the Honourable M r. Justice T. Monapathi on the 28th day of February 2000 I t h o u g ht justice n e e d ed that the application be h e a rd late in the afternoon despite h u s h ed pleas for a p o s t p o n e m e nt a nd a d e m o n s t r a t ed reluctance on b o th C o u n s el to h a ve filed h e a ds of a r g u m e n t. My c o n c e rn w as for the litigants. I w as serious w h en I postponed the case to the earliest convenient date. -2- This application w as filed on the 28th April 1999. It w as for stay of execution of default judgment, the setting aside of that default j u d g m e nt a nd related relief as s h o wn in prayers l(c) a nd (d) of the notice of motion. It b e c a me opposed with an opposing affidavit deposed to by M r. M o l o mo M o h a le a director of the Plaintiff. No replying affidavit w as filed. T he application c a me almost five (5) years after the disputed service. I was told, during argument, that the requirement of a successful application of this kind are: Firstly, that the enability or failure to enter appearance m u st not have been wilful. There must have been a just or reasonable cause for failure to enter appearance. A nd furthermore that the Defendant m u st have a bona fide defence to the claim against h im or her. There must not have been a delay in applying for rescission and thereby indicating an intention solely to delay the Plaintiff in realizing the fruits of his judgment. Finally that these requirements must all go together. This would be so if the circumstances were those under Rule 27 or the application was sought to be m a de under that rule. See c o m m e n ts in D O TI S T O RE v H E R S C H EL F O O DS P TY L TD 1982-84 L LR 338 and L O TI B R I CK (PTY) L TD v M P H O PU A ND O RS 1991-1995 L LR 446 This was therefore not quite accurate where the application seemed to be m a de under Rule 45. T he founding affidavit of the First Defendant showed that the three Defendants were directors and shareholders of a c o m p a ny called Sophia Enterprises Services (Proprietary) Ltd. (Sophia C o m p a n y) registered on the 22nd February 1991. Its m e m o r a n d um and articles of association were annexed as " S L 2" to the affidavit. All the directors were s h o wn to be of the s a me postal address of P . O. B ox 209, T h a ba Tseka. -3- T he First D e f e n d a nt described herself as e m p l o y ed as a m a n a g er at a petrol filling station at T h a b a - T s e ka o w n ed by S o p h ia C o m p a n y. T he Plaintiff is d e p o n e nt has a n s w e r ed this to say that the person he f o u nd at the filling station represented herself as Palesa L e k h a n ya (Second D e f e n d a n t ). First D e f e n d a nt h ad b e en advised by h er h u s b a nd that the D e p u ty Sheriff h ad on or a b o ut the 20th April 1 9 99 served a writ of execution at their residence in M a s e r u. In that writ she w as cited as First D e f e n d a n t. It w as in respect of a certain j u d g m e nt w h i ch w as obtained by default against "the D e f e n d a n t s" on the 2nd A u g u st 1 9 9 3. It w as c o m m on cause, i n a s m u ch as " S L 1" ( D e p u ty Sheriffs return) s h o w e d, , that on the 29th April 1 9 93 s u m m o ns w as served only on the S e c o nd D e f e n d a n t. It stated further that the D e p u ty Sheriff h as failed to find the other D e f e n d a n t s. In this regard I n o t ed the following points w e re sought to be m a de by the other D e f e n d a n t s: T h at the return did not s h ow w h e re in particular the S e c o nd D e f e n d a nt w as served. S e c o n d ly that it w as n ot b e i ng said that the other D e f e n d a n ts w e re inmates or m e m b e rs of the h o u s e h o ld of the S e c o nd D e f e n d a n t. It w as submitted that it could not be accurate in fact or in l aw that the Plaintiff should say: "I aver that is absolutely b e y o nd belief that the S e c o nd D e f e n d a nt could k e ep service of the s u m m o ns all to herself for so m ay years. 1 aver that service of the s u m m o ns u p on the S e c o nd D e f e n d a nt w as in the circumstances valid service e v en against the other D e f e n d a n t s ." It w as c o n t e n d ed that no such inference w as supportable a nd no principle allowed for such a presumption. In addition it w as c o n t e n d e d, against w h at w as sought to be p r e s u m ed a b o v e, that the dearth of further information f r om the return of service m a de things e v en m o re unhelpful. I w o u ld easily find that the D e f e n d a nt h ad a g o od explanation for her failure to defend. -4- T h at the D e p u ty Sheriffs return did not s h ow the place of service m a de it easier for the First Defendant to have said she did not k n ow of the s u m m o ns a nd at that date of service she w as far a w ay in T h a b a - T s e k a. S he a d d ed that the Second Defendant never gave h im a copy of the s u m m o ns as a result she never b e c a me aware of the s a m e. In this she w as supported by the affidavit of the S e c o nd Defendant. For these reasons she said she w as not in wilful default of entry of appearance to defend the execution. S he furthermore a d d ed the submission that she h ad a bona fide defence to the action in that she h ad never c o m m a n d ed the Plaintiff to do a ny design. T he Third D e f e n d a nt said he w as advised by his father that on or about the 20th April 1992 a deputy Sheriff of this C o u rt h ad g o ne to execute a writ against t h em at his parental h o me at Ha M a b o t e, M a s e r u. T h at Defendant w as advised by his attorneys of record that it appeared that there on the D e p u ty Sheriffs return of service the s u m m o ns w as served on the 2nd Defendant on the 29th April 1993. T he s u m m o ns h ad s h o wn his address as c/o Messrs T. Hlaoli & C o. N k h a t ho Building, M a s e r u. T he reason for this w as not k n o wn to the Defendant. Neither did he understand w hy the s u m m o ns w as not served at that address. He w as consequently not informed of the s u m m o n s. At that time of the alleged service the Third Defendant said he w as attending school in Bloemfontein w h e re he w as lodging. This w o u ld support a finding that there w as a reasonable explanation for this Defendant's failure to have entered appearance to defend. I w o u ld cite the s a me reasons, concerning the D e p u ty Sheriffs failure to state necessary aspects of his service, in favour of this Defendant. -5- In a similar m a n n er he submitted that he h ad a bona fide defence to the Plaintiffs action in that he had never personally and I or through his agent instructed the Plaintiff to do any design w o rk at anytime in respect of an hotel or any type of a building. He could not therefore prior to the issuance of the s u m m o ns nor anytime thereafter could he have accepted any ratified any drawings from the Plaintiff as being correct. M r. Matsau argued that the fact of the First a nd Third Defendant being directors of Sophia C o m p a ny did not speak against t h em with regard to whether they h ad a bona fide defence to the claim against them. This he sought support for by reference to there having been, on the papers, no dealing with any of the directors by the Plaintiff except one H u l a na whose address w as cited at Sophia Enterprises, Thaba-Tseka. T he First a nd Third Defendants while stating that they were directors of Sophia C o m p a ny reiterated that the C o m p a ny did not at any time ever instruct the Plaintiff nor authorize the said H u l a na either as its agent nor in any capacity whatsoever to commission the Plaintiff to m a ke any drawings for the c o m p a n y. In addition to the fact that M o l o mo M o h a le said the person he found at the filling station o w n ed by Sophia C o m p a ny w as the Second Defendant, there w as simply too plentiful references to the so called Sophia Enterprises in the papers in relation to the dealings between Plaintiff, H u l a na and s o me of the defendants. See also the minutes of 26th M a r ch 1991. Another Court would probably find a distinct business relationship. Or it would probably not. It will end up being very m u ch full of doubt that Sophia C o m p a ny which runs a filling station m a n a g ed by the Second Defendant h ad a similar (not same) n a me with an entity which went about to negotiate plans for design of a hotel. -6- A n o t h er C o u rt m ay say that it w as an inexplicable puzzle. In addition that C o u rt m i g ht place significance on the coincidence. T he attempts by the Defendants to dissociate themselves f r om the Plaintiff w h i ch the Plaintiff spoke about in paragraph 7 of M o l o mo Mohale's affidavit a nd the w h o le g a m ut of facts seeking to s h ow ignorance of the activities of the said H u l a na by the Defendants will require s o me g o od effort on the part of the Defendants. I agreed with M r. M o h au for Plaintiff w h en he contended that the defence, that w h en Plaintiff agreed with Sophia Enterprises it w as not Sophia C o m p a n y, w as not raised in the papers in the fine f o rm in w h i ch it appeared as a point of law during argument. I decided that M r. M a t s au w o u ld be entitled to raise it as a point of law. This w as besides the question as to whether it w as a valid point or not. This point which w as a legal point as to the legal persona (whether it w as a c o m p a ny or not) that the Plaintiff dealt with belongs to those probabilities that I h a ve spoken about. It sufficed if I said it w as an arguable point. It could not be said to be fanciful. I go back to say that if a j u d g m e nt w as obtained by mistake, w h e re service h ad not b e en proper that is against the rules of Court, it h ad b e en a nullity. All things such as execution following on the i m p r o p er process w o u ld be equally b ad because they c a me as a result of a mistake c o m m on to both parties, w h i ch if the C o u rt h ad b e en m a de a w a re it w o u ld n ot h a ve entered j u d g m e n t. See C O M P U T ER S Y S T E MS A ND N E T W O RK (PTY) L TD v M A S E RU C I TY C O U N C IL 1991-1996 L LR 82 at 92. It was not proved on the papers that there h ad b e en service of s u m m o ns on First D e f e n d a nt a nd Third Defendant. I allowed the application for rescission a nd stay of execution as against the First a nd Third Defendants. I ordered that costs w o u ld be costs in the action. I m a de the following further orders. -7- (a) T h at the T wo D e f e n d a n ts m u st file all their pleas within 14 d a ys f r om the 28th F e b r u a ry 2 0 0 0. (b) Priority be given to disposing of the action by t he Registrar by a p p o i n t i ng three d a ys of h e a r i ng w h i ch m u st n ot be later t h an the 15th June 2000. T. M O N A P A T HI Judge 28th February, 200