REPUBLIC OF SOUTH AFRICA      
                            GAUTENG DIVISION, PRETORIA
                                                                                                                                            
                                                                                 CASE NO: A798/14
									DATE:  17/3/2016
In the matter between:
LEAVIT TSHIKETANI MKHANSI                          First Appellant
BOMBELANI ANNEGRATH MAKAMU                Second Appellant
and

FIRSTRAND BANK LIMITED                                  Respondent                                                     

____________________________________________________________     
                                       J U D G M E N T                   
___________________________________________________________
Ismail J:

[1]	This is an appeal against the dismissal of a rescission of judgment, 
which was handed down by J W Louw J in this court against the 
appellants on the 3 April 2014. 

[2]	Leave to appeal was granted to the full court of this division on the 14 
May 2014.

[3]	The respondents aver that the appeal has lapsed in view of the 
appellants having failed to :

  3.1    file the required Notice of appeal within fifteen (15) days as provided 
           for in Rule 49 (2);
  
  3.2    bring a condonation application to explain the delay in prosecuting
           the appeal   

[4]	At the outset of the arguments presented, appellants representative, 
addressed the court on the aspect of condonation. He submitted that 
the appellants had a good case on the merits and for that reason 
condonation should to be granted. 

[5] 	The Appellate Division, in Melane v Santam Insurance Co, Ltd 1962 
(4) SA 531 at 532 B-E regarding condonation stated:
“ In deciding whether sufficient cause has been shown, the basic principle is that the
 Court has a discretion, to be exercised judicially upon a consideration of all the facts, 
and in essence it is a matter of fairness to both sides. Among the facts usually relevant 
are the degree of lateness, the explanation therefor, the prospects of success, and the 
importance of the case. Ordinarily these facts are interrelated; they are not individually 
decisive for that would be a piecemeal approach incompatible with a true discretion, 
save of course that if there are no prospects of success there would be no point in 
granting condonation. Any Attempt to formulate a rule of thumb would only serve to 
harden the arteries of what would be a flexible discretion. What is needed is a flexible 
conspectus of all the facts. Thus a slight delay and a good explanation may help to 
compensate for prospects of success which are not strong. Or the importance of the 
issue and strong prospects of success may tend to compensate for a long delay. And the respondent’s interest in finality must not be overlooked.” 

See also : United Plant Hire (Pty) Ltd v Hill 1976 (1) SA 717 (A) at 720 E-G;
Ferris and Another v FirstRand Bank Ltd 2014 (3) SA 39 (CC) at par 
[10]-[12] and Van Wyk v Unitas Hospital (Open Democratic Advice Centre
as Amicus Curiae) 2008 (2) SA 472 (CC) AT 477E.

[6]	The appellant submitted that this was a matter which concerned the 
right to housing in terms of section 26 of the Constitution. As such it 
concerned an important issue which needed to be ventilated, notwith-
standing the delay. 

[7]	Arguments were advanced by both protagonist, in respect of their 
cases. 

Background to the dispute:

[8]	The appellants entered into a home loan agreement with the 
respondent. The appellants experienced financial difficulties and they 
approached a debt counselor,  who arranged a debt review process for 
them. The debt review was restructured and made an order of court. The 
monthly instalments, to the respondent in terms of the debt restructured 
scheme was substantially reduced, almost by half the original payments in 
terms of the loan.

[9]	The appellants in terms of the magistrate’s court order were to pay 
over an amount of R24 580,00 per monthly to the payment agent, referred 
to as the PDA. 
For several months the appellants paid over an amount which was less 
than the amount they ought to have paid to the PDA, in terms of the 
magistrates order. 

[10]	The respondent issued summons against the appellants for their
breach of payments in terms of the agreement.  Default  judgment was 
granted against the appellants. The summons was served at the agreed 
domicilium of the appellants. It was common cause that the appellants did 
not receive the summons and a fortiori they were not in willful default. 

[11]	It came to the respondents attention that judgment was taken against
them and consequently they brought an application for rescission of the 
judgment taken against them. This application was heard by Louw J, 
referred to in par [1], supra.

The legal position:

[12]	Mr Tshishonga on behalf of the appellants  submitted that the court a 
quo erred in finding that the PDA was the appellants agent. As the PDA 
failed to pay over the reduced amount to the respondent, in terms of the 
restructured payment, the appellants were liable for the omission of their 
agent. He submitted that the PDA is not an agent of the debtor but rather 
a person who is appointed in terms of the Act and is an agent of the 
system.

[13]	In this regard he relied upon the decision of Nedbank v Thompson
2014 (5) SA 392 (GJ) and specifically to paras [14]; [16] and [19] of the 
judgment, where the court found that there was no relationship of agency 
between the PDA and the consumer.

In response Adv du Plessis SC, acting for respondent submitted that the 
Thompson decision was wrongly decided and that this court should follow 
the approach set out in Kneen and Roper v ABSA Bank Limited (Eastern  
Cape, Port Elizabeth Division, Case no 1358/2013, and at para’s 18-40 of 
the judgment) 

[14]	The question whether the PDA was the consumer’s agent was dealt 
with by Mavudla J in FirstRand Bank Limited v Barrett and Another 
(unreported matter in this division under case number 81205/2014 dated 
19 June 2015). At para [13] the learned Judge relied upon Thompson’s
matter where it was held that the Payment Distribution Agency [PDA) is a 
payment distribution agency approved by the National Credit Regulator (the 
NCR) and is not the agent of the consumer but of the counselor. 

[15]	Appellants counsel submitted that Louw J found that the consumers, 
the appellants, paid the full amount and their agent failed to pay over the 
re-arranged amount to the respondent. He relied upon the following extract 
from the judgment of Justice Louw:	
“ It is unfortunate for the applicants that this is the situation in that it appears that they 
may have made  all payments required of them, but that the PDA did not, on their part, 
pay what they were supposed to pay to FNB. The PDA is not FNB’S agent and acts on
behalf of the applicant.”

[16]	My understanding of the passage is that Louw J does not make a
conclusive finding that the monies were paid over to the PDA. The 
operative words being ‘ it appears that they may have’. The gist of the 
remarks pertains not as much as to how much was paid but rather to 
the issue of whether the PDA was FNB’s agent or the consumers agent.

[17]	For the purpose of this appeal it is not necessary for us to comment 
upon the issue whether the PDA is the agent of the consumer or otherwise. 
We are to pronounce upon the correctness or errors of the judgment 
handed down by Louw J in the court a quo, dismissing the rescission 
application. 

[18]	In this regard the pivotal issue is whether the appellants paid over the 
amount which was ordered by the court in terms of the restructured debt. 
 This issue raised some debate before us. On behalf of the appellants it 
was submitted that the full amount was paid to the PDA, whereas 
respondents counsel argued to the contrary. 
Respondents relied on exhibit LT1 (pages 180-191 of the record) to show 
that less than the amount due was paid to the PDA. 

[19]	From the uncontroverted evidence before us it is clear that the full 
amount was not paid to the respondent in terms of the re-arranged 
scheme, and the issue to be determined was whether the respondent was 
entitled to take judgment as it did.  

[20]	Mr Du Plessis submitted that once the rearranged scheme of 
payment is breached, in that any amount in terms of the re-arranged 
scheme is not paid, the credit provider need not give notice again. He 
submitted that support for his submission could be found in Ferris’
matter, supra, as well as Jili v Firstrand Bank Limited 2015 (3) SA 586 
SCA.

[21]	In Ferris, Moseneke ACJ at para [17] stated:
“It follows that Mr and Mrs Ferris ’breach of the debt-restructuring order entitled 
FirstRand to enforce the loan without further notice. However, even if further notice 
were required, its absence is a purely dilatory defence- a defence that suspends 
proceedings rather than precluded a cause of action- and is not an irregularity that 
establishes that a judgment has been ‘erroneously granted’, justifying a rescission 
under rule 42(1)(a).”  

[22]	In the light of the Constitutional Courts finding referred to above, it is 
abundantly clear that the issue of giving notice to the appellants was not 
necessary and it concomitantly follows that the appellants failed to show a 
bona fide defence.

[23]	Notwithstanding Louw J’s error in finding that the PDA was the agent 
of the consumer, the appeal should nevertheless be dismissed as the 
appellants breached the debt restructure agreement and they failed to put 
forward a bona fide defence.  

Costs

[24]	The question of costs was not argued before us, apart that the 
outcome of the appeal should be awarded with costs. More specifically the 
question of costs for two advocates on behalf of the respondent was not 
canvassed at all.

[25]	The question of costs is within the discretion of the court. It is trite that 
the costs would generally follow the result. The question which needs to be 
answered is whether the matter required the services of two counsel on the 
part of the respondents. 

[26]	The law on this aspect was sufficiently crystallized and I am of the 
view that this matter could have been handled by a single advocate, as 

opposed to engaging the services of two advocates.  

[27]	According, the following order is made:
(i)	The appeal is dismissed;
(ii)	The appellant is ordered to pay the costs of the appeal on a party and 
         party scale, such costs to include the costs of a one advocate.   	 

                                                           ___________________
                                                           Ismail J

I agree
                                                            ___________________
                                                            Mavundla  J

I agree
and it is so ordered 
                                                                                                            __________________________________
                                                                                                            Rabie J

 

APPEARANCES : 

For the Appellants:                     Mr V TshIshonga instructed by Khoranbi Mabuli 
                                          Attorneys Hatfield, Pretoria.
                                           
For the Respondent:         Adv D T v du Plessis SC assisted by Adv M 
                                          Reineke instructed by Bezuidenhout van Zyl &                                
                                          Associates

Date of Appeal:                           2 March 2016.      

Judgment delivered on:   17 March 2016