Urgent
Application
DUBE
J:
The
applicant applies for an anti-dissipation order to restrain the
respondent from removing and disposing of joint venture farm
equipment owned by a partnership pending his claim.
The
circumstances surrounding this application are as follows.
The
applicant was the owner of UNA Farm, Wedza. The farm was subsequently
offered to the respondent under the Land Reform Programme and the
allocation is subject of disagreement between the parties.
The
parties entered into a joint venture agreement in terms of which they
would engage in farming activities.
The
applicant was in terms of the agreement, to supply farming equipment
including the farm. The respondent was responsible for the financial
aspects of the joint venture as well as supervision of the growing of
crops. The parties were to share profits and losses.
The
applicant avers that the respondent has failed and refused to pay him
his share of profits. The applicant also avers that the joint venture
has bought a number of farming equipment which he lays a claim to.
On
23 June 2016, the applicant caused a summons to be issued under
HC6415/16 claiming his share of the partnership profits. The
applicant's protest is based on the averment that the respondent
has started to remove agricultural equipment and other assets
purchased from proceeds of the joint venture from the farm. The
applicant has the apprehension that the respondent intends to defeat
the object of his claim by removing assets from the farm so that
there will be no evidence of the assets when he finally obtains
judgment.
The
applicant seeks an order barring the respondent from removing the
joint venture equipment from the farm pending the finalisation of the
summons action. The applicant avers that he has no other remedy to
stop the respondent from removing and disposing of the agricultural
equipment.
The
respondent is opposed to the application.
He
challenges the urgency of the matter as well as the propriety of this
application.
The
applicant's pleadings disclose what is called an anti-dissipation
interdict. This type of interdict has its origins under English law
where it is known as the Mareva injunction. The interdict is named
after the famous case of Mareva Compania Naviera SA v International
Bulkcarriers SA (1980) 1 All ER 213 (CA). The case involved an
application to restrain removal and disposal of monies owed out of
the court's jurisdiction. The court held that where a creditor is
owed a debt, and has led evidence to show that there is a danger that
a debtor may dispose or conceal assets so as to escape execution, the
court may grant an interdict to prevent disposal of the assets.
In
the Civil Practice of the High Courts of SA 5th ed, Herbstein and Van
Winsen define this type of interdict as follows:
“A
special type of interdict which may be ground where a respondent is
believed to be deliberately arranging his affairs in such a way as to
ensure that by the time the applicant is in a position to exercise
judgment he will be without assets or sufficient assets on which the
applicant expects to execute.”
The
authors state that the purpose of the interdict is to preserve assets
from dissipation pending final execution against the defendant and
hence serves to ensure that an applicant will not be left with a
hollow judgment. The authors also state that the requirements of this
interdict are the same as for any other interdict.
This
form of interdict was debated in Knox D Aray Ltd and Ors v Jamieson
1995 (2) SA 579 (W), 1996 (4) SA 348 (A).
The
court accepted that the injunction is of a sui generis type. There
was extensive debate regarding the nature and requirements of the
interdict. What is important about the discussion is the acceptance
that this type of interdict is not the usual interdict where a party
seeks to preserve an asset which is subject of the issue between the
parties. The appeal court accepted that this sort of interdict could
be sought where a litigant sought to preserve assets which were not
in issue between the parties. The court was unable to find a name
appropriate for this interdict under the Roman Dutch Law. The court
seemed to want to come up with a name for the interdict different
from that used under English Law but was unable to find agree on an
appropriate term to be used under Roman Dutch Law. Stegmann J called
it an anti- dissipation interdict. He also proposed the term
interdict securitatem debiti, a term by which the interdict is widely
known in South Africa.
In
Odar Housing Development Consortium v Sensene Investments (Pvt) Ltd &
Ors HH709/15 and Mine Minerals Trading (Pvt) Ltd v NRZ Resources Ltd
SC40/14 our courts discussed this interdict.
What
the authorities reveal is that an anti-dissipation interdict is
granted in circumstances where a respondent has been shown to be
disposing or concealing property so that by the time that judgment is
obtained against him, he has no assets on which the other party may
be able to execute, thereby defeating the applicant's claim.
It
restrains an owner or holder of property from disposing of the
property in a particular fashion.
It
is in the nature of a prohibitory interdict and has the same
requirements as those of an ordinary interdict.
A
party seeking to bar another from dissipating property does not have
to show that the property is connected with the subject of the
applicant's claim for loss suffered. All a litigant has to show is
that the applicant has instituted a claim against the respondent.
Further that the respondent is in the process of disposing or
concealing all or some of the property concerned. It must be apparent
from the pleadings that the applicant has a real apprehension that by
the time he is in a position to exercise his judgment, he will be
without assets or sufficient assets on which he expects to execute.
The
application of anti-dissipation interdicts has been criticised.
In
Investec Employee Benefits Ltd and Anor v Electrical Industry
Kwazulu–Natal Pension Fund and Ors 2010 (1) SA 446 (W), the court
expressed reservations over this type of interdict. The court was
concerned about the approach that a person may be able to stop
disposal of property simply because he has a judgment he wishes to be
satisfied in the future.
There
is no doubt that the interdict restricts the manner in which a person
may want to deal with his property simply because someone has a claim
laid against him.
The
effect is a violation of one's constitutional right to property.
The interdict remains part of our law.
Like
in any other matter, the court dealing with such an application has a
wide discretion which it must exercise judiciously and would be
expected to cautiously weigh the competing interests of the parties.
The
applicant seeks an order interdicting the respondent from removing
assets from the farm on the premise that if he is allowed to do so,
he may defeat the object of his claim.
What
the applicant seeks is clearly an anti-dissipation order.
An
application for an anti-dissipation interdict is invariably brought
ex parte. This application was brought on notice and hence the normal
rules of procedure apply.
A
litigant wishing to have his matter dealt with on an urgent basis
should be able to show that the matter is urgent in the sense that if
it not dealt with on an urgent basis he is likely to suffer
irreparable harm. He is also required to show that he on his part
treated the matter as urgent. This approach to matters brought on an
urgent basis was laid out in Kuvarega v Registrar General 1998 (1)
ZLR 188. See also Madzivanzira and 2 Ors v Dexprint Investments (Pvt)
Ltd and Anor HH145/2002.
In
order to show that a matter is urgent, a litigant should craft his
papers in such a way that it is apparent on a reading of his papers
that his matter is urgent.
A
court seized with an urgent application is expected on the face of
the papers, without any further persuasion from the applicant, to be
satisfied that the matter is urgent before it sets down the matter
and hears the parties.
The
court should, on the basis of the contents of the certificate of
urgency alone, be able to ascertain whether the matter is urgent.
The
certificate of urgency serves to inform and guide the court regarding
the urgency of the matter. A certificate of urgency must place facts
before the court with sufficient detail as to enable the court to
decide on the urgency of the matter. It should outline details
sufficient to inform the court of the nature of the application, the
harm likely to be suffered if the matter is not dealt with on an
urgent basis and that the applicant treated the matter as urgent.
A
legal practitioner certifying a matter urgent must state reasons for
his own belief in the urgency of the matter. He must apply his mind
to the facts and circumstances of the case and must allege facts that
render the matter urgent justifying its placement on the urgent roll.
In addition to the brief circumstances of the case, the certificate
of urgency is required to state the following factors;
(a)
The conduct complained against and the circumstances surrounding such
conduct.
(b)
When the applicant became aware of the facts giving rise to the
complaint.
(c)
What the applicant did after becoming aware of the conduct complained
against.
(d)
The nature of the application being made and relief sought to address
the situation which should be of an interim nature.
(e)
The applicant must show that he treated the matter as urgent.
(f)
He must show that if the conduct is not addressed on an urgent basis,
irreparable harm will occur to him.
(g)
The nature and extent of the irreparable harm likely to be suffered
and the consequences thereof require to be stated.
Failure
to comply with the requirements governing the certificate of urgency
may result in a matter being removed from the roll for lack of
urgency.
The
urgency of an application for an anti-dissipation interdict arises at
the point when the need to bring the application for an interdict
arises.
In
a case where a litigant seeks to stop dissipation of assets on the
premises that a respondent is removing assets, the need to act arises
the moment the conduct complained against commences or when an
applicant becomes aware of the conduct complained of.
Such
a litigant is expected to show that he asserted himself and acted
timeously in order to stop the harm or danger posed. He must also
show that if the conduct complained against is not stopped he stands
to suffer irreparable harm in that, he will be left without assets or
sufficient assets on which he expects to execute.
The
respondent takes issue with the fact that the certificate of service
was done by a legal practitioner from the applicant's law firm.
The
rules do not specify who should certify a matter urgent.
The
mischief behind the rule that an urgent matter be certified urgent
was to streamline matters being brought on an urgent basis and to
eliminate abuse of the process.
A
practice has arisen where a legal practitioner from a different firm
is requested to certify the matter urgent. The objective was to seek
an independent view of the matter and prevent abuse of the system.
There
have been divergent views over the propriety of the certificate being
done by a legal practitioner from the same firm bringing the
application.
A
school of thought has developed that a legal practitioner from the
same law firm is usually conflicted and may pass matters as urgent
when they are not and usually has an interest in such a matter and
may not give an independent and professional view of the matter.
There are also challenges with requiring a legal practitioner from a
different law firm to certify a matter. The reality is simply that
some legal practitioners may simply be uninterested in the matter
resulting in them just signing certificates prepared by a colleague
without applying their minds to the contents.
When
one looks at the state of certificates that come before the courts,
that conclusion is inescapable.
Another
school of thought is that the certificate of urgency should be done
away with as it has seized to be useful to the court.
I
am of the view that a certificate of urgency is crucial as it aids
the court to streamline and recognise urgent matters. What is
essential is that the certificate meets the criteria and is crafted
in such a manner that it assists the court in the decision it has to
make.
A
matter should not be certified urgent as a matter of course.
Legal
practitioners certifying matters urgent should bear in mind the
responsibility and duty they have and such is to the court alone.
Legal practitioners are expected to address their minds to the
contents of the certificate and ensure that it meets the
requirements. It should not matter who certifies a matter urgent for
as long as the same legal practitioner bringing the application does
not certify the matter as urgent.
The
certificate of urgency filed in support of this application was done
by Felicity Ndou. She is from the same legal firm representing the
applicant.
My
view is that this alone is not fatal to the application. What F. Ndou
ought to have done is to ensure that the certificate meets the
standards expected.
The
certificate of urgency does not comply with Rule 244 and is
defective.
The
certificate is lacking in particularity regarding the facts and
circumstances surrounding urgency. It is not clear from the
certificate that the interdict sought is an anti-dissipation order.
Whilst
the certificate speaks to the claim in the summons, and states that
the respondent started to remove joint venture agricultural equipment
from the farm after he learnt of the claim, the certificate does not
include any facts as to why the matter should be dealt with urgently.
Nowhere
in the certificate of urgency does she make reference to any
irreparable harm likely to be suffered if the conduct complained
against is not stopped. The nature of the harm likely to be caused is
not outlined. It does not clearly set out the legal nexus between the
removal of the assets and the summons issued by the applicant in
order to reveal what harm is apprehended.
The
certificate of urgency stated that the “applicant acted with agency
to file this application”. It is clear that reference to “agency”
refers to urgency. This goes to show that legal practitioners do not
check their work.
It
is not clear from the application where the goods where being removed
to.
F.
Ndou did not show that she applied her mind to what was required of
her. The certificate of urgency is hollow. Her conclusion that the
matter is urgent has no legal basis.
Both
the certificate of urgency and the founding affidavit do not speak to
the harm that is likely to ensue if the conduct complained against is
not stopped.
For
an application to qualify as an anti-dissipation application an
applicant should show that if the conduct complained against is not
stopped, the applicant will have a hollow judgment rendering the main
application brutum fulmen.
This
averment should be part of the certificate of service.
The
applicant issued summons claiming his share of the proceeds of the
partnership on 23 June 2016. The applicant avers that he realised
that the respondent was removing partnership equipment from the farm,
namely tractors, on 27 June 2016. The applicant immediately lodged
this application on 29 June 2016.
The
matter was allocated to me on 15 July 2015.
There
is no explanation from the Registrar why the application was only
placed before me only then.
The
respondent submitted that the applicant filed a similar application
in the Magistrates Court on 18 May 2016 seeking to prohibit him from
removing any equipment from the farm. The court issued a rule nisi
which was suspended on the return date.
He
submitted further that the applicant has failed to disclose this fact
to the court and contended that the applicant is abusing the court by
filing a similar application in this court.
In
para 8 of the ex parte application filed at the Magistrates Court,
the applicant avers that he wants the farm equipment ''thereat''
bonded so that the respondent is interdicted from taking any of the
property outside the farm. He also says that he fears that the
respondent is misappropriating his property he brought to the joint
venture. In addition, he asks the court to stop removal of all the
property from the farm.
The
application does not deal solely with his personal property.
The
applicant is not being candid with the court when he states that this
application was prompted by what transpired after the issuance of the
summons.
He
knew as far back as May that he had a cause of action and did decide
to ask the Magistrate Court to intervene. The relief sought is
similar to that sought in the magistrate's court.
Having
chosen to go to the Magistrates Court, the matter could not be filed
in this court again. The same application is before me and applicant
is trying to circumvent an order of the Magistrates Court by way of
this application.
He
ought either to have appealed against that order or sought its
review.
The
matter is not urgent and is removed from the roll. The applicant is
to pay the costs of this application.
Macharaga
Law Chambers, applicant's legal practitioners
Mutangamira
& Associates, respondent's legal practitioners