FirstRand Bank Ltd v Kruger and Others

• Jurisdiction: South Africa
• Judge: Spilg J
• Judgment Date: 23 May 2016
• Citation: 2017 (1) SA 533 (GJ)
• Docket Number: 2015/5890
• Hearing Date: 23 May 2016
• Counsel: V Fine for the applicant.
• Court: Gauteng Local Division, Johannesburg

Spilg J:

Introduction D

[1] During the unopposed court hearings there were a number of applications brought on long-form notice of motion by financial institutions against defaulting credit receivers in relation to credit agreements for home loans and motor-vehicle finance. Previously, they all had been postponed by my brother Coppin J in order for the plaintiffs to file supplementary affidavits dealing with hearsay allegations. E

[2] There were a number of other cases on the unopposed motion roll which involved the same issue.

[3] The cases before me can be divided into those where there is some suggestion that the deponent has personal knowledge of certain of the essential allegations and those where on an overview of the founding F affidavit the deponent has not set out enough facts to demonstrate personal knowledge.

[4] The present case is an example of the latter.

[5] The claim was brought on notice of motion for payment of an G amount of just over R2,6 million, together with interest, and the hypothecation of the immovable property which was provided as security for the loan. In addition the bank sought an order rectifying the applicable interest rate from prime less 1,25% to prime less 1%.

[6] The affidavit was deposed to by a Mr Bongani Madliwa who describes himself as a commercial recoveries manager at the bank. H The grounds on which the facts contained in the affidavit are said to be admissible can be found in paras 2 and 3, which read:

'The facts contained in this affidavit fall within my personal knowledge, save where otherwise stated or where the contrary appears from a context, are true and correct. I

Where I rely on information obtained by and from individuals, including representatives of the applicants I believe such info to be true and correct.'

[7] Insofar as proof of the agreement is concerned the deponent attached a copy of the credit facility agreement and states that the bank was J

Spilg J

A represented by Ms Shaw and Mr Midlane. There is no confirmatory affidavit filed by these officials either in relation to the conclusion of the agreement or that they had made a mistake when inserting the interest rate. Furthermore, the deponent does not identify from whom he obtained any of the information relied upon: it is therefore not possible to ascertain which parts of the evidence presented are within the B deponent's own knowledge and which was conveyed to him by his unnamed sources.

Claim for rectification

[8] The only statements contained in the affidavit regarding the alleged error in determining the interest rate are to be found in the following C paragraphs:

'14.

The cost of credit section in the agreement erroneously records the Concession rate as — 1,25% and not 1%.

15.

However the facility graph (appearing in the agreement) correctly records the concession rate as — 1%.

16.

D The actual concession rate calculated and charged on the Facility was — 1% as recorded in the Facility graph.

17.

The incorrect concession rate was occasioned by a common error of the parties due to a mistake in the drafting and completion of the agreement, and the parties signed the agreement in a bon[a] fide but mistaken belief that it recorded the true Concession Rate.'

E [9] It is evident that only Ms Shaw or Mr Midlane can provide direct evidence to support a rectification of the agreement. Their affidavits are not attached and there is no evidence to indicate why either of the two officials was unable to depose to a confirmatory affidavit.

[10] Moreover, an allegation of fact in an affidavit which in truth F comprises no more than information that others may have provided cannot be elevated to real evidence simply because the deponent, under a standardised statement at the commencement of the affidavit, believes it to be true and correct.

G [11] The difference of 0,25% in the calculation of interest affects the correct calculation of the current outstanding amount and the rate of interest from the date of judgment until the judgment debt is paid, either prior to a sale in execution or pursuant to execution. This affects both the rights of other creditors and the rights of the debtor to receive any surplus amount arising from a sale. It also compromises the certificate of H indebtedness despite the clause in the loan agreement which provided that it constituted prima facie evidence of the outstanding amount. See Senekal v Trust Bank of Africa Ltd1978 (3) SA 375 (A) at 383A – C.

[12] Advocate Fine on behalf of the applicant has not suggested a basis upon which the rules of evidence may be relaxed. I am unaware of any I that would allow this court to receive the statements contained in these paragraphs into evidence. Accordingly, no case is made out on the papers for rectifying the agreement.

Sufficiency of other essential evidence

[13] The aspect of rectification just dealt with also brings into focus the J basic difference between allegations pleaded in a summons and those

Spilg J

which must be deposed to under oath in motion...