Court v Standard Bank of SA Ltd; Court v Bester NO and Others

• Jurisdiction: South Africa
• Judge: Joubert JA, Vivier JA, Eksteen JA, F H Grosskopf JA, Nienaber JA
• Judgment Date: 30 March 1995
• Docket Number: 133/93 & 638/93
• Court: Appellate Division
• Hearing Date: 28 February 1995
• Citation: 1995 (3) SA 123 (A)

Vivier JA:

The appeals in these two matters were heard together for reasons which will become clear later. In case No 9245/91 ('the sequestration proceedings') the appellant appeals to this Court against a final order for the sequestration of her estate granted by Scott J in the J Cape Provincial Division on 8 March 1993. The order was granted on

Vivier JA

A the application of the respondent in this appeal ('Standard Bank'). The application was supported by an intervening creditor, Syfrets Bank Ltd ('Syfrets Bank'), whose costs were ordered by Scott J to be paid out of the assets of the estate. The appeal was brought in terms of s 150 of the Insolvency Act 24 of 1936 ('the Act') prior to its amendment by s 1 of Act 129 of 1993. After the appellant had failed to lodge the record of the B proceedings in the Court appealed from by 7 June 1993, as required by Rule 5(4)(c) of the Rules of the Appellate Division ('the AD Rules'), case No 9716/93 was instituted in the Cape Provincial Division. In that case the joint trustees in the insolvent estate ('the trustees') as first and second applicants, Standard Bank as third applicant and Syfrets Bank as fourth applicant, sought an order on notice of motion declaring the appeal C in case No 9245/91 to have lapsed and authorising the trustees to realise the immovable properties vesting in the insolvent estate. The matter came before Brand J who granted the relief claimed. With the leave of this Court the appellant appeals in forma pauperis against the judgment of D Brand J and the orders granted by him. The respondents in this appeal are the joint trustees as first and second respondents (Barend Johannes Vorster Durandt NO having been substituted as second respondent for Marius van den Berg NO), Standard Bank as third respondent and Syfrets Bank as fourth respondent. There is also before us an application for condonation of the late lodging of the requisite copies of the appeal record in the E sequestration proceedings. This application is opposed by Standard Bank.

It is convenient to deal first with the application for condonation. The background facts may be summarised as follows: The sequestration proceedings were launched on 11 July 1991. After answering and replying F affidavits had been filed an agreement was reached in terms of which the application for sequestration would be held over pending an attempt to sell certain of the appellant's immovable properties in order to pay her creditors. The properties were not sold and the matter proceeded. A further set of answering and replying affidavits was filed and the matter eventually came before Scott J ('the first hearing'). Having reserved G judgment thereon the learned Judge on 14 September 1992 delivered judgment placing the appellant's estate under provisional sequestration. The judgment has been reported: Standard Bank of SA Ltd v Court 1993 (3) SA 286 (C). I shall refer to this judgment as the first judgment.

H The return day of the provisional order was extended from time to time and the appellant was allowed to file a further opposing affidavit. On 24 February 1993 the appellant's biggest creditor, Syfrets Bank, applied to intervene, also seeking a sequestration order. On 8 March 1993 the return day of the provisional sequestration order was argued before Scott J ('the second hearing'), the appellant appearing in person after her erstwhile I attorneys had withdrawn. On that day Scott J granted a final order of sequestration. I shall refer to this judgment as the second judgment.

On 31 March 1993 the appellant lodged a notice of appeal but she thereafter failed to lodge the record within three months of the date of J the judgment appealed against, ie on or before 7 June 1993. On 13 May

Vivier JA

A 1993, ie within the three-month period, the appellant requested Standard Bank to agree to an extension of eight weeks for the lodging of the record and she gave notice to the Registrar of this Court that she had so requested an extension. Standard Bank's attorneys reacted in a fax on 18 May 1993 stating that they would in due course take instructions from B their client. It was only on 4 June 1993 that they notified the appellant that Standard Bank would not accede to her request. By then it was clearly too late to lodge the record in time. It had not yet been lodged when case No 9716/93 for an order declaring the appeal to have lapsed was instituted on 10 August 1993.

The appellant's explanation for the delay is the following. The day after C the final order of sequestration was granted, ie on 9 March 1993, she asked Sneller Recordings ('Snellers'), the sole contractors for the preparation of appeal records, for a quotation for the preparation of the requisite number of copies of the record. She only received this on 26 March 1993. She was unable to raise the amount required and on 14 April D 1993 she requested a quotation for only one copy, which was given to her the following day. She then investigated the possibility of preparing the record herself and, after being advised against doing so, she instructed Snellers on 30 April 1993 to prepare one copy of the record. She was then informed that Snellers required a deposit of R3 000 before they would start preparing the record. After further negotiations Snellers on 5 May E 1993 agreed to commence the preparation of the record upon payment of a deposit of R300, the balance of R2 700 being payable on a date to be arranged. Snellers undertook to have the record available by 28 May 1993. The deposit was duly paid. On 6 May 1993 Mrs Digue from Snellers informed her that some of the documents in the case were missing and had apparently F been misplaced. The appellant consequently on 7 May 1993, 25 May 1993 and 8 June 1993 addressed letters to the Registrar of the Supreme Court in Cape Town asking him to attend to the incomplete record as a matter of urgency. No reply was received to any of these letters. On 28 May 1993 Snellers notified her that 'a bundle of missing documents, about 400 in G number', had been found which needed to be sorted out. The attorneys for Standard Bank were requested to make their file available to Snellers in order to reconstruct the record from these documents and their file was handed to Snellers on 16 June 1993. Snellers thereafter required some further documents which caused a further delay. On 1 September 1993 Snellers completed the preparation of one copy of the record which the H appellant uplifted the following day. On 10 September 1993 the requisite number of copies of the record were lodged with the Registrar of this Court and delivered to Standard Bank's attorneys. The record consists of nine volumes and runs to 755 pages. The application for condonation was filed on 20 September 1993.

I In my view it is clear from the aforegoing that the delay in lodging the record was mainly due to the fact that documents were mislaid in the Cape Town Supreme Court. For that the appellant can certainly not be blamed. I cannot accept, as has been suggested on behalf of Standard Bank, that the appellant was all along in possession of a fully paginated and indexed J copy of the Court's papers and that she could have seen to

Vivier JA

A the preparation of the record herself. She denies this suggestion, the facts do not support it and it is highly unlikely. I accordingly accept that the delay in complying with AD Rule 5(4)(c) was largely caused by factors beyond the appellant's control.

Other factors usually weighed by this Court in considering a petition for B condonation under AD Rule 13 include the importance of the case, the prospects of success, the respondent's interest in the finality of the judgment, the convenience of the Court and the avoidance of unnecessary delay in the administration of justice (per Holmes JA in Federated Employers Fire & General Insurance Co Ltd and Another v McKenzie 1969 (3) SA 360 (A) at 362F-G).

C The appeal is without doubt a matter of vital importance to the appellant. On the other hand her creditors clearly have an interest in the finality of the judgment, which is a factor militating against the granting of the indulgence (per Trengove AJA in Mbutuma v Xhosa Development Corporation Ltd 1978 (1) SA 681 (A) at 686F-687A). Two other factors mentioned, viz the convenience of the Court and the avoidance of unnecessary delay, are not important in the present circumstances. There is no or minimal D inconvenience to the Court and the delay was not great and was largely beyond the control of the parties.

In view of the fact that the other factors, either alone or cumulatively, are not of decisive importance, it becomes necessary to consider the E appellant's prospects of success on appeal.

The appellant, who appeared in person at the hearing of this appeal, submitted that the application for sequestration was fatally defective for want of compliance with s 9(3) of the Act in that when the application was issued by the Registrar and served on her it was not accompanied by a F certificate of the Master that security had been given. The same point was raised at the first hearing and rejected by Scott J (see the first judgment at 288C-291G). The security certificate requirement of s 9(3) is presently to be found in s 9(3)(b), which was inserted in the former s 9(3) by s 1 of Act 122 of 1993. The wording of the requirement has, however, remained unchanged.

G Section 9(3)(b) provides:

'The facts stated in the petition shall be confirmed by affidavit and the petition shall be accompanied by a certificate of the Master given not more than ten days before the date of such petition that sufficient security has been given for the payment of all fees and charges necessary for the prosecution of all sequestration proceedings and of all costs of administering the estate until a trustee has been appointed, or if no H ...