Absa Bank Ltd v Van Rensburg and Another

• Jurisdiction: South Africa
• Judge: Maya JA, Shongwe JA, Leach JA, Saldulker JA and Mathopo AJA
• Judgment Date: 28 March 2014
• Citation: 2014 (4) SA 626 (SCA)
• Docket Number: 228/13 [2014] ZASCA 34
• Hearing Date: 10 March 2014
• Court: Supreme Court of Appeal
• Counsel: LM Olivier SC for the appellant No appearance for the respondents.

Maya JA (Shongwe JA, Saldulker JA and Mathopo AJA concurring): A

[1] This is an unopposed appeal against a postponement order of the full court of the Western Cape High Court, Cape Town (Griesel J, Fourie and Saldanha JJ concurring), with its leave. The appeal was heard and B struck off the roll on 10 March 2014 and the court undertook that its reasons would follow. These are the reasons.

[2] The background facts are simple. The appellant (Absa) launched action proceedings against the respondents in the high court based on mortgage bonds registered in its favour over immovable properties C belonging to the respondents. The respective claims were commenced by way of simple summonses to which were annexed copies of the relevant mortgage bonds and the deeds of suretyship signed by the spouses of the respective owners. In due course the claims were set down for hearing as unopposed applications for default judgment. In those D proceedings a question arose whether or not it was necessary to attach to the simple summonses the underlying credit agreements secured by the bonds and suretyships as had been required in some cases of that division.

[3] In light of divergent views on the question in the division, the matters E were referred for hearing by the full court to obtain clarity as to the correct procedure to be followed. Absa denied the need to annex the underlying agreements to the summonses. It relied for its stance mainly on the absence of such a requirement in the Uniform Rules of Court (the rules) and the Consolidated Practice Note of the Western Cape High Court. It contended that the establishment of such a practice by the full F court would effectively usurp the powers of the Rules Board which is constituted to make relevant prescriptions in the rules and specify the requirements applicable to a simple summons. And, in defended matters, the practice would necessitate the attachment of voluminous documentation both to simple summonses and the subsequent declarations. This would result in unnecessary duplication and expense, it was G argued.

[4] The full court considered various authorities on the issue, including judgments of its division and relevant practice in other large divisions. It came to the conclusion that the weight of authority favoured a view, H which it adopted, that 'although a simple summons is not a pleading, it is nevertheless necessary, on a proper interpretation of rule 17(2)(b), read with form 9, to attach a written agreement where the plaintiff's cause of action is based on such agreement'. To this finding the full court added two riders — that (a) it would not be compulsory for a plaintiff seeking a default or summary judgment to file the original agreement I unless so directed by the court; and (b) a plaintiff who relied on portion only of a voluminous written agreement could attach only such portion to the summons. The court then postponed the matters sine die with no order as to costs. The matters were postponed to afford Absa an opportunity to amend its summonses so as to refer to the underlying credit agreements and annex them. It is the full court's reason for the J postponement orders to which Absa objects.

Maya JA (Shongwe JA, Saldulker JA and Mathopo AJA concurring)

[5] However, subsequent to the lodging of the appeal, Absa settled the A two matters with the respective respondents. But this notwithstanding, it persisted with the appeal despite the resolution of all disputes between the parties. [1] It contended that the question of law at issue (ie whether it is necessary for a plaintiff who institutes action by way of an ordinary summons to annex the written agreement upon which its cause of action B is based) is not confined to the parties inter se since the issue is likely to arise frequently. Thus, this court's judgment would still have a practical effect or result, so it claimed.

[6] Two preliminary issues that may each decide the fate of the appeal arise for determination. One is whether this court should hear the appeal C at all in light of s 21A(1) of the Supreme Court Act 59 of 1959 (the Act). [2] The other is whether the matter is in any event appealable, having regard to the nature of the orders appealed against.

[7] According to s 21A(1), if the issues in an appeal 'are of such a nature that the judgment or order sought will have no practical effect or result, D the appeal may be dismissed on this ground alone'. These provisions set a direct and positive test: whether the judgment or order will have a practical effect or result and not whether it might be of importance in a hypothetical future case. [3] As a result, this court will not 'make determinations on issues that are otherwise moot merely because the parties believe that, although the decision or order will have no practical result E between them, a practical result could be achieved in other respects'. [4]

[8] But the section confers a discretion on this court. [5] Thus, in The Merak S: Sea Melody Enterprises SA v Bulktrans (Europe) Corporation [6] this court found that allowing the appeal would have no practical effect but F nonetheless decided the merits of appeal. The court reasoned as follows:

'In view of the importance of the questions of law which arise in this matter, the frequency with which they arise and the fact that at the time

Maya JA (Shongwe JA, Saldulker JA and Mathopo AJA concurring)

A of the decision in the Court a quo and of the granting of leave to appeal those questions were . . . live issues, I am satisfied that this is an appropriate matter for the exercise of this Court's discretion to allow the appeal to proceed: cf Coin Security Group (Pty) Ltd v SA National Union for Security Officers and Others 2001 (2) SA 872 (SCA) at 875 (para 8) and Natal Rugby Union v Gould 1999 (1) SA 432 (SCA).'

B In Land en Landbouontwikkelingsbank van Suid-Afrika v Conradie [7] this court once more decided the merits of an appeal — whether the termination of the right of residence of an occupier was just and equitable within the meaning of s 8(1) of the Extension of Security of Tenure Act C 62 of 1997 — where the occupier had vacated the property by the time the appeal was heard and had no interest in its outcome, which would have no practical effect for the parties inter se. The court considered the question of law involved, which arose frequently, important. It further took into account that the judgment appealed against, which was found D to be wrong, had already been followed in a reported judgment. So, depending on the facts of each case, while the parties may have resolved all their differences, a court of appeal may nevertheless entertain the merits of the appeal if, for example, important questions of law which are likely to arise frequently are at issue and their determination may benefit E others. [8]

[9] Elsewhere, utmost caution in exercising that discretion has been advocated. In an English decision, R v Secretary of State for the Home Department, Ex parte Salem, [9] which has been considered by this court F albeit without pronouncing a final view on its dictum, [10] as here, the discretion to adjudicate an appeal, where there is no longer a dispute between the parties, was strictly limited to the area of public law. And that court further circumscribed the discretion as follows:

'The discretion to hear disputes, even in the area of public law, must, G however, be exercised with caution and appeals which...