Spartan
Caselaw
COSTS – Security – Trust lacking funds – Trust does not have necessary funds to satisfy any adverse costs that may be granted against it – Weighing of both parties’ versions against principles of equity and fairness – Court’s discretion – Trust’s should furnish security – Prospects of success in the main application are bleak – Trust is ordered to pay security for costs – Determination on amount deferred to Registrar so that an appropriate amount in respect of security is fixed – Uniform Rule 47(3).
Facts and issue: The respondents (Tax Faculty NPC) seek an order compelling the applicants to provide security for costs. In the main application, the Trust held the view that the directors of the Faculty were incompetent in running the affairs of the Faculty. The Trust thus sought to remove them. Although the dispute in the main application concerns the legal status and the validity of the 2019 MOI of the Tax Faculty, the Trust’s objective in these proceedings was to remove the directors of the Faculty.
Discussion: The Trust does not have the necessary funds to satisfy any adverse costs that may be granted against it. The Trust, in its papers, conceded this fact. The balance of equity and fairness boils down to weighing the injustice of the defendant if no security is ordered and if the plaintiff’s claim fails, the defendant would find itself unable to recover the costs that had been incurred in defence of such claim. This must be weighed against the injustice that the plaintiff may suffer if prevented from pursuing its proper claim. The Faculty argued that the main application is not only reckless but the application is unsustainable. Emphasis was placed on the fact that the Trust has no real assets, no bank account, and it was evident from the financial statements from the period 2020 and 2021 that the Trust was dormant and was not operating since 2019. Despite the Trust instituting this application in April 2023, it was not serious in finalizing the matter. The Trust has made serious claims against the Faculty and against the conduct of the directors without adducing substantial evidence to support its accusations. There is no merit in these allegations.
Findings: Upon having considered all the relevant factors, namely the nature of the claim, the financial position of the Trust, the stage at which the application for security was brought, and weighing both parties’ versions against the principles of equity and fairness, the court is of the view, that the Trust should furnish security. The Trust’s case is unassailable as the Faculty is a PBO and the decision-making powers are statutorily ordained, not only in the Companies Act, but in terms of the Income Tax Act as well. The prospects of success in the main application are bleak.
Order: The Trust is ordered to pay security for costs in terms of Rule 47. The applicants are ordered to pay the costs of the application.
Engel NO v Tax Faculty NPC [2024] ZAGPPHC 940
20 September 2024
KOOVERJIE J
COSTS – Withdrawal – Public interest litigation – Same applicant who purportedly brought application to champion interests of public withdraws application – No justification – No compelling reason why matter was not pursued albeit being ripe for hearing – Abrupt withdrawal shows that it was not launched in good faith – Impossible to conclude that it was public interest litigation – Constitutes extremely unreasonable behaviour – Applicant is to pay costs.
Facts and issue: Ruling on a request by the respondents for a cost order against the applicant or his attorney or the deponent to the applicant’s founding affidavit (Mr Sass). The relief sought is pursuant to the withdrawal of the applicant’s urgent application without conducting a hearing on merits. The applicant opposes an award of costs against it. According to the applicant, the court should depart from the normal rule that a party that withdraws litigation should bear the costs as it undertook this litigation in the interest of the public.
Discussion: The main difficulty in this case springs from the fact that the very same applicant who purportedly brought the application to champion the interests of the public, withdraws the application. There is an oddity around the fact that the applicant withdrew the application. The withdrawal of the application is extremely illuminating. It bolsters and lends gravitas to the assertion that incompetent demands were made to the applicant and that the application was never launched to vindicate public interest. It speaks to the bona fides of the applicant in bringing the application. Most telling and significant is the fact that it was withdrawn, albeit it was ripe to be heard. There was no justification proffered for the withdrawal of the application. There is nothing in the papers that provides a compelling reason why the matter was not pursued. This begs the question as to how could it then be found that the applicant acted reasonably in withdrawing or launching the application? It is ironic if not hypocritical that a litigant that came to court claiming that it seeks to vindicate a public interest issue, yet on the eve of the hearing, the very litigant abandoned such litigation that was even brought on an urgent basis.
Findings: The application was withdrawn whilst one of the issues that were raised against the application was the standing of the applicant to bring the application. The abrupt withdrawal of the application shows that it was not launched in good faith. Absent any evidence to the contrary, it is impossible to conclude that this was public interest litigation. This takes the present case outside the scope of public interest litigation. Such litigation should not be financed by the taxpayers. The respondents have incurred costs due to the institution and the last-moment withdrawal of the application by the applicant. Thus, the respondents are entitled to be reimbursed for the unnecessary expenses. The withdrawal of an opposed application, brought on an urgent basis, on the eve of a hearing, constitutes behaviour that is extremely unreasonable.
Order: The applicant is to pay the costs of the application.
Roodeberg Residents Association NPC v Drakenstein Municipality [2024] ZAWCHC 271
19 September 2024
NZIWENI J
COSTS – Party and party – Uniform Rule 67A – Appropriate scale upon which plaintiff`s fees are to be payable – Applicability of factors listed in rule for purposes of determining appropriate scale do not require consideration – Factors are not relevant where trial has been settled – Value of claim was substantial which does not fall within jurisdiction of Regional Court – Scale B of fees for plaintiff`s counsel is appropriate – Defendant is to pay plaintiff capital amount of R200,000.
Facts and issue: It was the plaintiff’s case in terms of the pleadings that she was unlawfully arrested and unlawfully detained. She claimed R400,000 for general and special damages suffered. The court was advised by Mr van Eeden, who appeared on behalf of the plaintiff, and Mr Chauke, who appeared on behalf of the defendant, that the action has been settled between the parties. The parties, however, could not settle the scale upon which the plaintiff`s fees are to be payable.
Discussion: The matter has been settled on the basis that the defendant is to pay the plaintiff the capital amount of R200,000 in respect of “damages suffered by the plaintiff”, together with interest on the said amount and costs of suit. The costs order made by the court must only indicate the scale in terms of rule 69, under which costs have been granted. Mr Chauke submitted that scale A is the appropriate scale in the present matter. He submitted that only the importance, value and complexity of the case are the factors in terms of rule 67A(3)(b) which are to be taken into consideration when determining the appropriate scale. Mr Chauke submitted that none of the said factors justify costs on scale B in the present circumstances.
Findings: The court does not have to express itself on the applicability, or not, of the factors listed in rule 67(A)(2) for purposes of determining the appropriate scale, since those factors are not relevant in this instance where the trial has been settled. Mr van Eeden submitted that scale B is the appropriate scale of fees in the present matter. This matter was due to be on trial in respect of both merits and quantum and had been certified trial-ready and allocated three days for the trial. A bundle of documents, consisting of the contents of the police dockets and some photos, were also to be used during the trial. The value of the claim was R600,000, which is a substantial amount which does not even fall within the jurisdiction of the Regional Court. In the totality of the circumstances the court finds that scale B of fees for plaintiff`s counsel is appropriate.
Order: The defendant is to pay the plaintiff the capital amount of R200,000 for damages suffered by the plaintiff. The defendant is to pay the plaintiff’s costs of suit to date, on a scale as between party and party on the High Court tariff and counsel’s fees on scale B, having regard to the provisions of Uniform Rules 67A and 69.
Khanye v Minister of Police [2024] ZAFSHC 285
12 September 2024
VAN ZYL J
COSTS – Biowatch principle – Matter became moot – Applicant seeks to be protected from costs order – Not insulated from costs order once matter becomes moot – Continuation with moot matter is tantamount to an abuse of process – Constitutes reckless litigation – Costs order warranted under such circumstances – Party who asserts constitutional right is not liable to costs in event matter is dismissed – Applicant liable to pay for costs incurred after mootness.
Facts and issue: Is the Biowatch principle a watchdog against cost orders for all instances where a case has been dismissed by a Court? In this case, the reach and purport of the Biowatch judgment shall be considered. See Biowatch Trust v Registrar Genetic Resources and Others 2009 (10) BCLR 1014 (CC). The case only deals with the issue of costs associated with the review application which has since been declared moot by the applicant itself.
Discussion: Dynamic effectively alleged a breach of section 217 of the Constitution. By that reason, the review application asserted a constitutional right. All the parties are congruent to each other that the review application set off as a constitutional matter. The respondents, in consonant to each other, submitted that at a point, the review application lost its constitutional nature, and it was thereby spewed out of the Biowatch insulation. At no stage is it apparent or pleaded that Dynamic changed its pleadings from asserting a constitutional right to a non-constitutional right. This position puts paid to any assertion that the applicant acted like a chameleon and changed colour of its asserted claim. Up until the applicant red carded itself, the application was endowed with the armour of the Biowatch insulation because it asserted a breach of a constitutional right. Although the applicant correctly conceded that it became liable for the costs of litigation, such liability arose not because the litigation changed texture and colour but because the applicant was reckless, as it were, in not terminating the lis after it acquired a mootness status which rendered it susceptible to being dismissed.
Findings: After the review application achieved mootness, in persisting with costs claim only, Dynamic would no longer be asserting a constitutional right. In that success costs pursuit exercise, no constitutional right is capable of being asserted. It is for that reason that Dynamic is liable to pay the costs after the mootness set in. The veil would have fallen off the face. The review application did not at any stage lose the Biowatch insulation to the extent that it still asserted a constitutional right. It remained the pleaded case of Dynamic that in making and cancelling the awards, SITA did not act fairly, equitably and transparently as enjoined by section 217(1) of the Constitution. When the review application became moot, it simply assumed the risk of being dismissed by virtue of it being moot. It was never dismissed. Dynamic is liable to pay the costs associated with the review application after 31 March 2023. Regarding the costs prior thereto, on application of the Biowatch principle, Dynamic is not liable to pay costs.
Order: The applicant is to pay the litigation costs occasioned after 31 March 2023 and those costs must be taxed or settled on a scale of attorney and client which costs must include the costs of employing two counsels. Regarding the costs associated with the litigation prior to 31 March 2023, each party must bear its own costs.
Dynamic Recovery Services v State Information Technology Agency [2024] ZAGPPHC 898
10 September 2024
MOSHOANA J
COSTS – Taxation – Shuttle service for plaintiff – Disallowance of full amount claimed – Reduced mental capacity of plaintiff – Unable to use public transport and personal family transport – Contends use of shuttle services was neither luxurious nor over cautious – Taxing master assessed disbursement items in accordance with principles and rules – Discharged discretion properly and correctly – Full shuttle accounts do not qualify as party and party charge – Reasonable transportation fee was allowed – Review dismissed.
Facts: The taxing master ruled that the shuttle usage for the plaintiff's travelling costs to attend medical legal examinations is a luxury on a party and party basis. For this reason, she disallowed the full amount claimed for the shuttle service and instead allowed a fee that she considered a reasonable cost of transportation. She ruled that the travelling costs would be allowed at a rate of R3,00 per kilometer in 2018, and R3,50 per kilometer in 2019 to 2021. The plaintiff contends that the taxing master should have allowed the full shuttle service accounts because of the plaintiff having a reduced mental capacity. It was submitted at taxation that the plaintiff was not able to make use of public transport and personal family transport. The plaintiff's attorneys instructed shuttle services to collect the plaintiff from his residence and to transport him to and from consultations at their office, medical legal appointments with the experts, and to the virtual court hearing at their offices.
Application: The plaintiff, dissatisfied with the taxing master's rulings, requests a review of taxation in terms of Uniform Rule 48. The taxing master reduced amounts claimed as disbursements (expenses) of the bills of costs. It was advanced that the use of the shuttle services to transport the plaintiff was both reasonable and necessary under the circumstances and for that reason the items were reasonable, proper and necessary and that the taxing master was wrong in her decision to reduce the claimed amount.
Discussion: The applicant contends that the use of the shuttle services was neither luxurious nor over cautious but vitally necessary to ensure that the patient attended the medical legal appointments and virtual court hearings in Pretoria. A strict application of the normal transportation principles applicable to an able-bodied individual to the plaintiff is deemed to be inequitable. Plaintiff submits that the full shuttle costs were reasonably incurred and not increased through over-caution, negligence or mistake. The full shuttle costs are not luxurious and extravagant so it would not be an injustice to impose upon the Road Accident Fund. The taxing master ruled that an attorney is bound to litigate in the least expensive and most expeditious manner. Over caution and fear that the client will not arrive timeously at any expert appointment cannot be recovered on a party and party scale. The extent of the reduced mental capacity was not fully explained at the taxation. She stated that there was nothing to indicate in the taxation that the litigant was so incapacitated that it required special intervention. From the submissions it is not made out that the plaintiff was constrained by having to carry any medical equipment that would require specified and preferred transportation.
Findings: At item 146 the plaintiff claims a disbursement of R6,240 to travel from Mafikeng to Pretoria and returned home on the same day. On the very next day, the same conveyance is repeated back to Pretoria, travelling some 640 km return and charging a further R 6,240 at item 147. A night's accommodation in Pretoria would have been cost effective and reasonable in the circumstances reducing the travel costs by a full return trip. The taxing master reduced each of these amounts and she rightly did so. The taxing master assessed the disbursement items in accordance with principles, rules and recognized practices regarding taxation and discharged her discretion properly and correctly. The full shuttle accounts do not qualify as a party and party charge, even though the plaintiff may have a reduced mental capacity. A reasonable fee for transportation by a motor vehicle was allowed. There is no reason to interfere with the taxing master's discretion.
Order: The review of taxation is dismissed.
FRANCIS-SUBBIAH J
Sindor v Road Accident Fund [2024] ZAGPPHC 917
5 September 2024
FRANCIS-SUBBIAH J
COSTS – Against municipality – Conduct compelling application – Exorbitant charges dispute – Trust was unjustly compelled to bring application because of incorrect addition of exorbitant charge to its account by respondent – No explanation – Error made not recognized or admitted – Threatened to disconnect electricity supply – Provided no assistance and no advice to investigate and rectify error – Trust was entirely successful in dispute – Respondent directed to pay costs.
Facts: The applicant is the joint executor of the estate of the deceased and a trustee of a trust created by the deceased’s will (the Trust). One of the assets of the Trust is a certain immovable property. The property has both a residential and commercial component to it. The third shop and the dwelling are supplied with electricity and water by the respondent municipality. An account was received from the respondent that indicated that, in addition to its regular monthly charge, the amount of R524,901.08 (the exorbitant charge), plus VAT, was owed by the Trust. According to the Trust, all that it legitimately owed the respondent was an amount of approximately R12,000. The applicant did not receive a sympathetic hearing. He was told that the Trust had no option but to pay the account and if it could not do so, then payment arrangements to the satisfaction of the respondent would have to be agreed upon. But the exorbitant charge would have to be paid. An application was then launched and was set down as an urgent application. The order provided that the Trust was to file a formal objection with the respondent to the invoice which had first introduced the exorbitant charge onto the Trust’s account.
Application: The Trust complied with the order and filed the formal objection. The objection was considered by the respondent and was upheld. The exorbitant charge was duly reversed by the respondent and disappeared from the Trust’s account. Having resolved the Trust’s problem, the respondent wanted the application to be withdrawn and its costs paid by the Trust. The Trust would not agree to pay the respondent’s costs. It was, however, prepared to withdraw the application on condition that the respondent paid its costs. The respondent was not prepared to do so. The matter is before court to decide only the issue of who should pay the costs of the application.
Discussion: The Trust was unjustly compelled to bring the application because of the incorrect addition of the exorbitant charge to its account by the respondent. Why this occurred has never been explained by the respondent. Mr Ntshebe, who appeared for the respondent, submitted that by the time the respondent delivered its answering affidavit, the exorbitant charge had been reversed and there was no need to deal with why it had been added to the Trust’s account in the first place. The court is of the view that it ought to have been dealt with. But for the addition of the exorbitant amount to the Trust’s account, the application would not have seen the light of day. The error made by the respondent in doing so was not recognized, or admitted, by its servants and the Trust was initially told that it was required to pay the exorbitant charge. Thereafter, the Trust was given the run around by the respondent when it tried to get the respondent to rectify the situation that it had created. During this, the respondent threatened to disconnect the supply of electricity to the property.
Findings: Ms Gama for the respondent provided no assistance and no advice to the Trust’s attorney. She did not draw his attention to the complaint channel insisted upon in the court order. The respondent knew full well what the complaint was. It had received it in writing on a number of occasions from the Trust’s attorney and it was encapsulated in the draft application papers that had been sent to it in advance of the application being brought. In each instance, it was invited to reconsider its position, but chose not to do so. It did not have to insist on a formal complaint being lodged. Insisting that this be done only when before the court smacks of cynicism and places form before substance. The Trust was ultimately vindicated and did not have to pay the exorbitant charge and thus the risk of disconnection of its water and electricity supply ended. The Trust was entirely successful in what it set out to achieve. The respondent’s conduct was unsatisfactory throughout.
Order: The respondent is directed to pay the costs of the application, including the costs reserved on 15 May 2023, such to be taxed on scale B.
MOSSOP J
Hansa v Ethekwini Municipality [2024] ZAKZDHC 57
30 August 2024
MOSSOP J
COSTS – Security – Vexatious litigant – Respondents declared by court order as vexatious litigants – Remains extant – Instituted multifarious applications based on same cause of action – Unsuccessful in all applications – Argument did not have any reasonable prospects of success and was dismissed in several court applications – Need exists to restrict respondents' access to courts – Crucial to protect applicants from abuse – Directed to furnish security for applicants’ costs – Uniform Rule 47(3).
Facts and issue: Interlocutory application in terms of Rule 47(3) of the Uniform Rules, in which the applicants seek an order that the respondents be ordered to furnish them security for costs in the sum of R250,000. The application is premised on an order granted, in which Henney J declared the respondents’ vexatious litigants. The order declaring the respondents’ vexatious litigants followed multifarious applications brought by the respondents against the same applicants in various courts. The respondents were unsuccessful in all the cases and the various courts granted cost orders against them. The respondents sought leave to institute proceedings long after they had instituted proceedings. The court order declaring them vexatious litigants remains extant.
Discussion: The respondents have instituted multifarious applications. Those applications were based on the same cause of action in the various courts. The respondents were unsuccessful in all their applications. The respondents now intend to impeach the eviction order, and the subsequent writ of ejectment issued by the Registrar as they aver that the default judgment granted by agreement against them was unlawful and that the court was not competent to endorse it when one considers the provisions of section 129(3)(a) and (b) of the National Credit Act 34 of 2005 (NCA). The respondents have already ventilated this argument on numerous occasions. This defence (in terms of section 129 of the NCA) raised by the respondents withstood judicial scrutiny by three judges of the court as well as the Supreme Court of Appeal. Notably, the Supreme Court of Appeal and the Constitutional Court, on several occasions, found that this argument does not have any reasonable prospects of success.
Findings: All the applications that the respondents lodged in the various courts dealt with this aspect that the default judgment granted against them was unlawful. This argument was dismissed in several court applications. In the circumstances, there is a need to restrict the respondents' access to courts. Restricting the respondents' access to court is indispensable to protect and secure the right of access for those with meritorious disputes. It is also crucial to protect the applicants from abuse. The respondents must be ordered to provide security for costs. The respondents’ deliberate and flagrant disregard of the court's order declaring them vexatious litigants under the Vexatious Proceedings Act threatens the effective functioning of the court.
Order: The respondents are jointly and severally directed to furnish security for the applicants’ costs in the main application.
Hardisty v Jiyana [2024] ZAWCHC 228
29 August 2024
LEKHULENI J
COSTS – Taxation – Out of town attorney – Indigent plaintiff in Eastern Cape – Attorney in Pretoria briefed – This firm then appointing attorneys in Eastern Cape – Taxing mistress refusing to allow two bills of costs – Case law discussed – No evidence that plaintiff could not have found competent local firm that would have acted on contingency basis – Instruction of firm in Pretoria was not necessary – Application for review dismissed – Uniform Rule 70(8).
Facts: The applicant resides at Mqanduli in the Eastern Cape, is unemployed and indigent, and was unable to afford legal representation. The issue of costs and legal representation was referred to Christopher Consulting who in turn briefed Werner Boshoff. Werner Boshoff practise from Pretoria and they in turn appointed Ms Pienaar practising at Netteltons in Makhanda, Eastern Cape. Summons was issued against the MEC of Health, Eastern Cape. The applicant is the mother and guardian of a minor child, and claimed damages that presumably arose out of the negligent treatment of the child (this was not clear from the papers). The applicant was successful and was awarded a substantial capital sum and costs order.
Application: After receipt of the award by the court, the applicant, in terms of the order, submitted two bills of costs between party and party by Werner Boshoff, and the correspondents at the seat of the court, namely, Netteltons. The Taxing Mistress refused to allow two bills of costs and refused to sign an allocator, ruling that “no items” had been disallowed. This is an application for a review of the decision of the Taxing Mistress.
Discussion: The MEC (defendant) had submitted to the Taxing Mistress that the plaintiff should have instructed an attorney in a nearby town such as Mthatha, Queenstown or East London or an attorney at the seat of the court directly, instead of instructing an attorney in Pretoria, which had resulted in unnecessary duplication costs, which was not for the account of the defendant. The plaintiff invited the defendant to identify any unnecessary duplication of costs which would not been incurred, had the plaintiff appointed an attorney in Mthatha, Queenstown or East London. These costs were never identified as a result of the Taxing Mistress’s decision. It was contended that without the financing supplied by Christopher Consulting the applicant would not have been able to litigate and this would be detrimental to the minor child and her rights.
Findings: Uniform Rule 70(8) deals with remuneration where more than one attorney is engaged, and the decision as to whether a litigant is entitled to recover the cost of an out of town attorney, as well as those of an attorney engaged at the seat of the court, is one for the Taxing Mistress. The applicant resides at Mqanduli, which is 30 km away from Mthatha. The applicant chose to instruct an attorney in Pretoria, which is 1,004 km away from the applicant and 1,042 km from the seat of the court. There is no evidence before the court to find that applicant could not have found a competent firm in Mthatha, or Makhanda, that would have acted for her on a contingency basis. The instruction of a firm of attorneys in Pretoria was not “necessary”. The court is not persuaded that the Taxing Mistress erred in making the ruling that she did.
* See the case law discussion at paras [25]-[31].
Order: The application for review is dismissed. The applicant is ordered to pay the costs of the defendant on Scale A, in terms of Rule 69(7).
BRODY AJ
Mokwana v Minister of Justice [2024] ZAECMKHC 100
20 August 2024
BRODY AJ
COSTS – Urgency – Seniority of counsel – Applicant brought an application of undisputed urgency – Justified and well-founded to address unlawful action on part of respondent – Through his actions, respondent conceded application – Usual rule is that applicant should be awarded costs – No reason to depart from rule – Scale of costs – Applicant’s briefing of senior junior counsel was appropriate – Entitled to recover costs commensurate with counsel’s seniority – Costs granted on Scale C.
Facts and issue: The applicant sought as a matter of urgency an order directing the respondent to vacate the applicant’s property. In addition, the applicant sought the costs of this application on scale C, as contemplated in Uniform Rule 67A, and that those costs be paid on a punitive, attorney and own client, basis. By the time that the application was called in the urgent court, the respondent had vacated the premises. The substantive relief sought by the applicant has thus become moot. All that remains for determination is the question of costs (the respondent having refused to make a tender in that respect).
Discussion: The respondent disputes that he should pay the costs of the application. In the alternative, he contends that, if an adverse costs order were to be granted, he should not pay costs on a punitive scale and that any party and party costs order should not be on scale C. The applicant has brought an application of undisputed urgency, which was justified and well-founded, in order to address unlawful action on the part of the respondent. The respondent, by his actions, has essentially conceded the application. The usual rule in such circumstances is that an applicant should be awarded costs. There is no reason to depart from that.
Findings: The applicant was justified in employing an experienced and streetwise counsel, given that the respondent had indicated that he was intending to raise a variety of defences and, for example, seek to invoke the protections afforded by the Prevention of Illegal Eviction from and Unlawful Occupation of Land Act, 19 of 1998 (PIE) and also attempt to cloud the issues by portraying them as interlinked with the pending divorce action. The indications were that the respondent would thus seek to complicate the issues as much as possible, as part of his strategy to improve his bargaining position for the divorce, and at least try to frustrate and delay using PIE, in circumstances where he knew that time was of the essence for the applicant, who had to give vacant occupation to a tenant. The applicant’s briefing of a senior junior counsel was appropriate, and she is entitled to recover costs commensurate with that counsel’s seniority.
Order: The respondent is to pay the costs of the application on a party and party basis, with counsel’s fees granted on Scale C.
VDM v VDM [2024] ZAWCHC 210
6 August 2024
FARLAM AJ
COSTS – Punitive – Application for security for costs – Peregrinus respondent – Tender was made on security for costs – Rejected on basis that it was vague – Respondents given adequate indication that any costs order made in their favour in main application will be satisfied – Respondents abusing court process – No justifiable reasons to persist with application for security for costs – Refused to accept tender and instead gave instruction to persist in application – Application dismissed.
Facts and issue: The issue in this application is what scale of costs the court should award in favour of the respondent, Redpath Africa Limited (RAL) following the tender for security made by it in favour of the applicants on 11 May 2023, the wasted costs for the application for security for costs against the respondent, a peregrinus incorporated and registered in Mauritius. SSC and Arendse (respondents) filed a notice in terms of rule 47(1) requesting security for costs from RAL. SSC and Arendse were not satisfied with RAL’s response to the request and so launched this interlocutory application. They seek an order that RAL must furnish them with security for costs in an amount of R1,200,000.
Discussion: In terms of Uniform Rule 47 and at common law a peregrinus plaintiff (or applicant) who does not own immovable property in the Republic with sufficient unburdened margin to satisfy costs that may arise, may be ordered to give security for the costs of his action. SSC and Arendse argue that once it is established that the respondent is a peregrinus, an appropriate security for costs order should be made. However, this argument misses the fact that indeed on 11 May 2022, a tender was made to them on the security for costs. The tender was rejected on the basis that it was vague even though the movable heavy equipment was identified as well as its value which is in excess of $3,500,000 and its location and the undertaking that it would not be removed from its location which is a mining site. The offer was only accepted on 27 July 2022 and despite the acceptance, when the heads of arguments were prepared, which is 5 days after the acceptance of the offer, on behalf of SSC and Arendse, there was no reference to the acceptance of the offer. In the absence of any reference to the acceptance of the offer for tender on security for costs, the heads of arguments are misleading to the court as it no longer necessary to make an appropriate order on the security for costs.
Findings: In the light of the tender made by RAL, there is simply no basis for the court to make any order in the application. On the facts, SSC and Arendse have been given an adequate indication that any costs order made in their favour in the main application will be satisfied. There is no suggestion that the letter was not received. SSC and Arendse implicitly accept that it was received. When considering whether the stance of SSC and Arendse is an abuse of process, is: why did SSC and Arendse not accept the tender and instead give the instruction to persist in the application and file heads of argument ignoring the letter of 11 May 2022 entirely? By doing so, SSC and Arendse were abusing the court process because there were no justifiable reasons to persist with the application for security for costs post 11 May 2022.
Order: The application for security for costs is dismissed. The parties are ordered to pay their own costs up to 11 May 2022. SSC and Arendse are ordered to pay the costs on the scale as between the Attorney and client from 11 May 2022 onwards.
Redpath Africa v Siyakhula Sonke Empowerment Corp [2024] ZAGPJHC 766
31 July 2024
SENYATSI J
COSTS – Punitive – Unacceptable settlement – Underlying causa was a loan agreement sounding in money – Applicant’s settlement proposal indicating this would include a punitive cost tender – On receipt thereof respondent adopted to thwart costs by responding with a tender in terms of an offer to settle – Then making payment of tendered amount without an acceptance of tender by applicant – Conduct is not bona fide and an abuse of process – Respondent is ordered to pay costs – Uniform Rule 34(1).
Facts and issue: The application pertains to the perfection of a general notarial bond. The application emanated from an urgent application and was set down as the final return date, pursuant to a provisional order granting the perfection of a notarial bond. The only issue that remained in dispute between the parties was the issue of costs. The respondent filed a rule 34(1) notice.
Discussion: The rule 34(1) tender, absent a cost tender, was made after close of business on 10 April 2024. Without any response from the applicant’s attorneys and without notifying them, the respondent’s attorneys paid the sum of R1,900,000 into the applicant’s attorneys’ trust account the following day (11 April 2024), and it only came to the applicant’s attorney’s notice the day thereafter (12 April 2024). Immediately thereafter the applicant’s attorneys sent correspondence setting out the cost dispute between the parties. No response was received from the respondent. The amount may be retained, seeing as though the respondent’s indebtedness is not disputed. The applicant’s attorney’s actions were reasonable. An immediate letter requesting that the parties deal with the issue of costs is acceptable behavior in the circumstances.
Findings: On receipt of the applicant’s settlement proposal on 10 April 2024 indicating that this would at that stage include a punitive cost tender, the respondent adopted to thwart costs by responding with a tender in terms of 34(1) and then making payment of the tendered amount, without an acceptance of the tender by the applicant. These actions are not bona fide and an abuse of process.
Order: The respondent is ordered to pay the costs of the application including the costs reserved on a scale as between attorney and client, including the cost of counsel on Scale B.
Segwit SA v Kwality Group Africa (Pty) Ltd [2024] ZAGPPHC 768
30 July 2024
VAN DER MERWE AJ
COSTS – De bonis propriis – Identical affidavits in multiple matters – Abuse of court process – Legal practitioners’ ethical duty to their clients, courts and public – Affidavit must contain personal facts that are correct and truthful – Attorney and counsel deliberately misled court through use of identical affidavits – Displayed lack of care for interests of clients and respondents – Costs order de bonis propriis justified – Matter referred to LPC for further investigation.
Facts: The Court handed down judgment in the main matter between the parties. The order provided that the issue of costs was postponed and would be dealt with after the parties have filed their representations on the issues. This was included in the order due to the court’s concern that its processes were being abused when six identical applications were placed on the urgent roll as individual matters when in fact it appeared to be one application replicated six times. What was of particular concern was that all six applicants evinced identical backgrounds, barring certain information such as their countries of origin and when they entered South Africa or when and where they were arrested. Further that they were all instituted by the same firm of attorneys, Manamela MA Attorneys and contained the same grammatical errors. This gave the inescapable impression that one application was used as a template, and then copied and pasted onto the others.
Costs: The court is called to determine the issue of costs in the main matter between the parties. Although both sets of legal representatives were invited to submit written argument within 14 days from the date of judgment on why a punitive costs order should not be granted against the applicants and/or their legal representatives, the applicants applied for leave to appeal, putting this process on hold. That application was dismissed, but neither they or the respondents subsequently filed any representations.
Discussion: An analysis of the six applications confirms that what was placed before the court was a single affidavit, reproduced six times with minor changes. The inescapable conclusion is that none of the affidavits contain personal information relating to the applicants’ individual experiences, nor can they be regarded as truthful. There is no other conclusion than to find that this is an abuse of the court’s process. Manamela MA Attomeys has found for itself a cottage industry of exploiting vulnerable asylum seekers, who likely do not understand what they are deposing to. The affidavit is signed by the deponent and commissioned by a commissioner of oaths who certified that the deponent signed the above affidavit in their presence; that the deponent knows and understands the contents of the affidavit; and that they had no objection to taking the prescribed oath which they consider to be binding on their conscience. This verbatim format, with minor additions or subtractions was used in the 8 of the 9 matters identified from Manamela MA Attorneys which were judicial reviews against the failure to renew expired asylum permits.
Findings: It is hardly expected for legal practitioners not to make mistakes while drafting. What is unacceptable is for these mistakes to be replicated in almost all of a single law firm’s applications. What this analysis demonstrates beyond doubt is that no new drafting took place but a cut and paste exercise was employed in all the different matters, only changing personal details. The ineluctable conclusion is that Manamela MA Attorneys have involved themselves in “cottage industry” conduct or practices. It is a clear abuse of the judicial process. The use of identical affidavits, not only in this matter, but those recycled in previous matters involving both Manamela MA Attorneys and Mr Vobi were clearly aimed at misleading the courts. Their conduct can only be regarded as deliberate and displayed a lack of care for the interests of their clients and those they cited as respondents. There was also no information placed before the court explaining how the affidavits were commissioned in English when on their purported versions, the applicants only spoke “broken English”. This conduct is wholly incompatible with the duty legal representatives have towards the court and their clients. The matter has raised serious concerns regarding the integrity and conduct of both Mr Manamela and Mr Vobi. The result is that this matter must be referred to the Legal Practice Council for further investigation.
Order: Mr Manamela and Mr Vobi are ordered to pay the costs of the main application de bonis propriis on scale A.
MLAMBO J (TWALA J and COLLIS J concurring)
Lembore v Minister of Home Affairs [2024] ZAGPJHC 749
29 July 2024
MLAMBO J