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IN THE HIGH COURT OF SOUTH AFRICA

GAUTENG DIVISION, JOHANNESBURG

Case number: 2017/01554

In the matter between:

BJB PROJECT SERVICES                                                                               APPLICANT

AND

REATLEGILE PROJECTS CC                                                                      RESPONDENT

JUDGMENT

WENTZEL, AJ:

1. This is an application for rescission of  the judgment granted against the applicant in  favour of the respondent on 4 May 2017 under case number 1554/2017.

2. The application is based on the contention that the judgment was erroneously granted within the meaning of Rule 42(1)(a), in as much as the service of the process upon the applicant at its principal place of business by “delivering to the principal door”, as the premises were found locked is not sufficient, as Rule 4(1) (a) requires that such process be effected by “affixing” a copy of such process to the main door of such place of business. It is also averred that the place of service is not its principal place of business, which is in Port Elizabeth, and is its small Midrand/Gauteng satellite office located on a small holding in a rural area, with only 3 full-time staff members in the office.

3. The applicant further alleges that it would not have been possible for the Sheriff to have affixed the process to the principal  door as required, as he could not have gained access to the premises which are enclosed in an office park at which access is restricted by a locked gate and intercom. Should the process have been affixed to this outer gate in circumstances where the intercom was not operational, this, it is averred, would not constitute delivery at the applicant’s place of business.

4. In the alternative, the applicant alleges that it has good cause for its default in failing to file a notice of intention to defend in terms of Rule 31(2) (b). It avers that the process did not come to the attention of anyone at the applicant’s Midrand Branch. It first became aware of the application on 12 May 2017 when its managing director discovered that its bank accounts were frozen when he attempted to pay its staff as its funds had, pursuant to the judgment, been attached by the Sheriff. It avers that it has a bona fide defence which, prima facie has some prospects of success. It also avers that it has a damages claim against the respondent which it wishes to pursue by way of a claim in reconvention.

5. The parties concluded an agreement in terms of which the respondent was appointed as a subcontractor by the applicant to build three full green field sites in three projects on behalf of Ericsson. These, as I understand it, are are cellular phone towers designed to look like trees and thus, not negatively impact on the environment.

6. The applicant alleges that the respondent breached the agreement by failing to construct the sites in a proper and workmanlike manner and in accordance with the works and in failing to provide the necessary documentation. It avers that as a result of the respondent failing to attend to the snag list, it was obliged to employ other contractors to do so.

7. The applicant successfully brought an application to stay execution pending the outcome of this application for rescission. The costs in that application were reserved.

8. At the hearing of the application,  the respondent conceded the application of rescission, but the applicant sought the costs of the application for rescission, as well as its costs for its urgent application to stay execution on an attorney and client scale, as its opposition was in the face of known disputes between the parties. In this respect, it rejected the respondent’s offer that costs be costs in the cause.

9. The respondent contended that it had withdrawn its opposition on the advise of counsel, who had only recently been briefed in the matter,  in view of the low test that need be satisfied in order to obtain rescission  of a judgment under Rule 31 (1) (b). It believed that an order of costs in the cause was appropriate because:

9.1.  Rescission is an indulgence;

9.2. It is premature at this stage to evalauate the merits;

9.3. Its opposition was reasonable and bona fide and it only received advise to withdraw its opposition belatedly when counsel was briefed to appear.

10. I do not accept that the service was defective as properly construed “delivery to” the principal door can only be construed to mean by affixing the process to the principal door. It cannot be construed to mean by sticking the process under the principal door, alhough this would have readily come to the applicant’s attention.However, I am concerned by the averment that the intercom was not working. If this is the case, the process could only have been affixed to the outer perimeter gate, which would not have been sufficient. However, the fact that there was an intercom, not at the applicant’s premises, but at the outer gate of the complex, is not a fact that appears from the return.  I believe that had the return indicated this, in all probability, Lamont J would not have granted default judgment. However, I recognize that the return serves to correct the address of the applicant, perhaps serving to confirm that the Sheriff did indeed gain access to the premises.

11. The respondent disputes that prima facie, bona fide defences have been raised to its claims for payment. It states that the applicant has not established that a written agreement was concluded between the parties and that its excuse that the person who concluded it has left its employ and its hardrive crashed is far-fetched. In any event, the terms averred to be breached are terms averred to be part of both the oral and written agreement and this thus takes the matter no further.

12. The respondent performed services to the applicant as a subcontractor to Ericsson who enaged the applicant ot build 3 green sites. It avers that the first two green sites were completed and its invoices were processed and approved by Ericsson. It thus avers that snag lists cannot now be relied upon to dispute payment. The respondent states that it stopped work completing the third tower as it had not been paid for the first two green site towers completed by it.

13. The respondent thus avers that its opposition was not frivolous and the merits favour it. It thus contends that it is premature to determine the issue of costs at this stage.

14. In reply it was averred that this Court is in the best position to determine the costs of the rescission application. It avers that the opposition was unreasonable as it was readily apprarent that there was at least a prima facie defence raised which if established, would constitute a good defence to the claims. This was evident from the snag lists prepared. It was a matter for the trial court to determine if the snags were adequately remedied.

15. Having considered all of the above arguments, I am satisfied that had the process have come to the applicant’s attention, it would not have been in default of entering an appearance to defend. I accept that it may have  a legitimate defence to the respondent’s claims for payment and may have a competent counter-claim against the respondent.

16. Although I accept that the respondent was entitled to legitimately oppose the application for rescission brought under Rule 42, I am in agreement with counsel for the respondent that in view of the substantial disputes of fact between the parties as to whether the work was adequately performed and the snags remedied and whether the applicant  could legitimately refuse to perform its obligations in respect of the third site in view of the non-payment for its services in respect of the first two sites, the application for rescission should not properly have been opposed. As these defences were set out in the application to stay execution, the same considerations apply.

17. In these circumstances, I believe that it is appropriate that the respondent be mulcted with the costs of its opposition to these applications. However, I see no basis whatsoever that these costs be on an attorney and client scale.

18. I accordingly make an order as follows:

18.1. Granting rescission of the default judgment granted by Lamont J on 4 May 2017;

18.2. Directing the respondent to pay the costs of the application on the party and party scale, as well as the costs incurred as a result of its opposition to the urgent application to stay execution of the judgment.

 

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                                                                                                      SM WENTZEL AJ

                                    ACTING JUDGE OF THE HIGH COURT OF SOUTH AFRICA

GAUTENG DIVISION

JOHANNESBURG

 

 

Counsel for the applicant : C Gordon

Instructed by Greyvensteins Attorneys

Counsel for the respondent: AM Bezuidenhout Attorneys

Date of hearing: 30 January 2018

Date of Judgment: 19^th April 2018

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