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NORTH WEST HIGH COURT, MAFIKENG

CASE NO. 1204/2012

In the matter between:

ABSA BANK LIMITED N.O ......................................................................1^ST PLAINTIFF

Trustees for the time being of THE EMIRA PROPERTY FUND

STRATEGIC REAL ESTATE MANAGERS (PTY) LTD .................................2^ND PLAINTIFF

and

TERENCE HENRY COWLEY ......................................................................DEFENDANT

____________________________________________________________________________

JUDGMENT

____________________________________________________________________________

GUTTA J.

A. INTRODUCTION

[1] This is an application for summary judgment, in which the plaintiff claims:

1.1 Payment of the amount of R486 737.58;

1.2. Interest at the rate of 2% per annum above prime lending rate from time to time, alternatively 15.5% per annum a tempora morae to date of final payment.

1.3 Costs of suit on an attorney and client scale.

[2] The plaintiff’s claim arises from an agreement of lease entered into between Prime View Properties (Pty) Ltd, whose rights and obligations were ceded to the plaintiff and Advidata Trading 654 CC t/a Plet Movie House, whose rights and obligations were ceded to the Terence Cowley Family Trust (“the Cowley Trust). The defendant bound himself as surety and co-principle debtor for the due and proper fulfillment of the obligation of the Cowley Trust toward the plaintiff.

[3] The plaintiff alleged that the defendant failed to pay the rental since 22 July 2009 and claims payment in the amount of R486 737.58, and that the defendant has also vacated the leased premises.

B. DEFENDANT’S GROUNDS OF DEFENCE

[4] The defendant raised five grounds of defence, namely:

4.1. The deponent to the affidavit in support of the application for summary judgment is not a person who can swear positively to the facts and does not have the requisite personal knowledge in order to verify both the cause of action and the amount claimed as contemplated in Rule 32(2);

4.2. The cessions from Prime View Properties (Pty) Ltd to Emira Property Fund (Pty) Ltd have not been proven and are denied;

4.3 Erroneous calculation of the amount claimed;

4.4 The partial extinctive prescription of the plaintiff’s claim;

4.5 The consensual variation of the terms of the lease agreement.

[5] Mr Swart, counsel for the plaintiffs, contended that the cause of action is the lease and the cession which are not in dispute. The claim is founded on a liquid document. The deponent is the Director – Property Management of the Eris Property Group (Pty) Ltd, the managing agent of the plaintiffs and he alleged that he has knowledge of the facts in that:

“a) All the records, documentation and files are under my control;

b) I have studied and examined all the aforesaid documentation and have personal knowledge of the contents thereof; and

c) The aforesaid matter had been allocated to me by the Plaintiff by virtue whereof I am personally in control thereof.”

[6] Mr Swart also referred the Court to Annexure THC2, attached to the defendant’s opposing affidavit, wherein the name Eris Property Group (Pty) Ltd appears as representing the landlord. He alleged that the defendant on the one hand relies on this document and on the other hand avers that he has no knowledge who Eris Property Group (Pty) Ltd is.

[7] Accordingly, Mr Swart submitted that the deponent, Mr Scott Thorburn, can swear positively to the facts verifying the cause of action.

[8] Counsel for the defendant, Mr Hitge, submitted that the first plaintiff claims in its capacity as alleged cessionary and derives its right to claim from the cedent, namely, Prime View Properties (Pty) Ltd. The lease agreement relied upon by the plaintiff was concluded between Prime View Properties (Pty) Ltd and Advidata Trading 564 CC and the cessionary (first plaintiff) would not have personal knowledge of the circumstances giving rise to the lease agreement.

[9] Mr Hitge submitted that Mr Thorburn’s allegation to have personal knowledge should be rejected because on the plaintiffs’ version, the managing agent of the first plaintiff is the second plaintiff and not Eris Property Group (Pty) Ltd.

[10] Mr Hitge submitted that Mr Thorburn cannot swear positively to the facts and the plaintiff should have attached a confirmatory affidavit from either Prime View Properties (Pty) Ltd or RMB Properties (Pty) Ltd, who represented Emira Property Fund, when the rights in terms of the initial lease agreement had been assigned, in verification of the alleged cause of action.

C. ANALYSIS

[11] Rule 32(2) requires that the affidavit be made by the plaintiff himself or by any other person who can swear positively to the facts verifying the cause of action and the amount.

[12] A person’s ability to swear positively to the facts is essential to the effectiveness of the affidavits as a basis for summary judgment and a Court entertaining the application must be satisfied prima facie that the deponent is such a person.

[13] The essential requirement is that such other person should state, at least, that the facts are within his or her personal knowledge.

[14] Case law on persons deposing to affidavits on behalf of corporate entities, suggest that a deponent may rely on company records to acquire knowledge of the facts. As Van Heerden AJ in Standard Bank of SA Ltd v Secatsa Investments (Pty) Ltd & Others 1999 (4) SA 229 (C) at 235A–C, stated that:

“Firsthand knowledge of every fact which goes to make up the plaintiff’s cause of action is not required, and that where the plaintiff is a corporate entity, the deponent may well legitimately rely on records in the company’s possession for his or her personal knowledge of at least certain of the relevant facts and his or her ability to swear positively to such facts, on record in the company’s possession.”

[15] Wallis J, as he then was, in Shackleton Credit Management v Microzone Trading 88 2010 (5) SA 112 at 118, held that he does not understand these cases as saying that the deponent can have no personal knowledge whatsoever of the facts giving rise to the claim, and rely exclusively on the perusal of records and documents in order to verify the cause of action and the facts giving rise to it. He was of the view that if the facts relied upon rest solely on documents provided, then the substantive contents of the affidavit consists entirely of hearsay.

[16] A manager of a bank would, by virtue of his office, have personal knowledge of the extent to which his client had overdrawn his account and would be entitled to rely on banking records. See Barclays National Bank Ltd v Core 1975 (2) SA 514 D at 515H–517B.

[17] An affidavit by a trustee was held to be insufficient where the particulars of claim related to a period of time prior to the appointment of the trustee in the plaintiff’s insolvent estate and in respect whereof the plaintiff had no dealings whatsoever. See Bouman NO v Howe 1980 (2) SA 226 (W); Erasmus: Uniform Rules of Court at B32, B1 – 216.

[18] Where the cessionary of a debt sued the debtor on the debt and applied for summary judgment on the strength of an affidavit signed by a director of the cessionary company, and there was nothing in the affidavit to indicate that he had any connection with the cedent of the claim and consequently that the facts relating to the claim were within his knowledge, summary judgment was refused. The application was fatally defective. See Trekker Investments (Pty) Ltd v Wimpy Bar 1977 (3) SA 447 (W); Paddy’s Investments (Pty) Ltd v Moolman Bros Construction Co (Pty) Ltd 1982 (1) SA 249 (D) at 250C–I; Shell Zimbabwe (Pty) Ltd v Webb 1981 (4) SA 749 (Z) at 751–2.

[19] The above-cited authorities are relevant in casu as this matter involves a cession and the cessionary and its authorised manager claim payment in terms of a lease agreement from the defendant.

[20] Apart from the letter referred to by Mr Swart, where the name ‘Eris Property Group (Pty) Ltd’ is mentioned, there is nothing in the affidavit to indicate that the deponent had any connection with the cedent and/or the plaintiff that the facts relating to the claim were within his knowledge.

[21] In any event, the Court cannot attach any weight to the letter referred to by Mr Swart as it is not signed by a representative of Eris Property Group (Pty) Ltd.

[22] Furthermore, the defendant in his opposing affidavit avers that the arrangement was consented to by Emira Property Fund (Pty) Ltd and attached annexure THC2 in support thereof. The defendant makes no mention of Eris Property Group (Pty) Ltd.

[23] The second plaintiff is cited as the authorised manager of the scheme, while the deponent, Mr Thorburn, is alleged to be the director–property management of the plaintiff in the employ of Eris Property Group (Pty) Ltd. Hence, there is uncertainty about who is managing the plaintiff.

[24] When considering the question whether Mr Thorburn is someone who is presumed to have personal knowledge or is someone who acquired knowledge in the course of his duties as the director – property management of the plaintiffs or whether there are any reasons connected with his employment that would result in him acquiring sufficient personal knowledge of the facts to depose to the affidavit in support of summary judgment. The answer to the above questions does not appear from the affidavit as a whole or from the opposing affidavit or other documents relating to the proceedings.

[25] It is common cause that the deponent relies on information furnished to him to verify the cause of action. Hence, his knowledge is gained from the documentation and records under his control which he has studied and examined. Accordingly, on his own affidavit he does not have direct and personal knowledge in relation to the claims.

[26] A Court relies on the deponent’s affidavit when granting summary judgment, and because summary judgments are a drastic and final remedy which closes the door to the defendant, the Court must be satisfied that the deponent is a person who can swear positively to the facts verifying the cause of action and the amount.

[27] I agree with the submission made by Mr Hitge that the application is fatally defective as there is no connection between the deponent and the cedent, and the inference of personal knowledge is lacking despite the deponent’s ipse dixit that he has personal knowledge.

[28] In the circumstances, the Court cannot be satisfied that Mr Thorburn is able to swear positively to the facts verifying the cause of action and the amount claimed or that he is prima facie in the position to swear positively as to the existence of the cession of which the plaintiff is the cessionary.

[29] Further, not even an admission by the defendant that he owes a portion of the amount claimed implies that the plaintiff’s application is in order as it is the plaintiff’s duty to bring his application within the ambit of Rule 32(2). See Van Niekerk Gyer Mundel , Summary Judgment a Practical Gude ‘Lexis Nexis’ at pages 5–19 (Issue 10). Accordingly, one can deduce that the substantive contents of Mr Thorburn’s affidavit are hearsay.

[30] In the circumstances, it is not necessary for me to deal with the remaining defences raised by the respondent, save to state that Mr Swart, at the commencement of the proceedings submitted that he is only arguing the portion of the plaintiff’s claim for which the defendant has offered no defence, namely, for the period up to 14 December 2009 and claimed payment in the amount of R122 391.27. Hence, this in effect amounts to a concession that the defendant has raised a bona fide defence in respect of a portion of the plaintiff’s claim.

D. ORDER

[31] In the circumstances, the Court grants the following order:

a) The application for summary judgment is hereby dismissed.

b) Leave to defend is hereby granted.

c) The plaintiff is ordered to pay the defendant’s taxed costs of the application for summary judgment.

_________________

N. GUTTA

JUDGE OF THE HIGH COURT

APPEARANCES

DATE OF HEARING : 29 NOVEMBER 2012

DATE OF JUDGMENT : 13 DECEMBER 2012

COUNSEL FOR PLAINTIFFS : ADV B. SWART

COUNSEL FOR DEFENDANT : ADV M.G. HITGE

ATTORNEYS FOR PLAINTIFFS : MINCHIN & KELLY INC.

(Instructed by GIDEON PRETORIUS INC.)

ATTORNEYS FOR DEFENDANT : VAN ROOYEN TLHAPI WESSELS INC.

(Instructed by VAN VELDEN-DUFFEY INC.)

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