Crocodile Mountain Investments Swaziland (Pty) Ltd v Mndzebele (1422/2013) [2018] SZHC 111 (01 June 2018);

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Civil Procedure-urgent application for interdict of a prohibitory or restrictive nature-non-joinder and improper service-effect thereof-failure to controvert or refute opposing party’s allegations, effect thereof-umnumzane and a director and shareholder of a company-who has right to manage farm-import of failure to follow section 3 of Farm Dwellers Control Act on umnumzane. Costs-court’s discretion to award costs wide, unfettered and equitable-costs follow event versus punitive costs-when punitive costs awarded-Court must be satisfied that applicant’s conduct justifies order of punitive costs and that a party and party cost order will not suffice to meet the expenses incurred by the opposing party-in absence of evidence that cost order on normal scale will not be enough to meet the cost of successful party punitive costs not granted.

 

 

 

 

IN THE HIGH COURT OF ESWATINI

JUDGMENT

 

                                                                                         CASE NO. 1422/13

HELD AT MBABANE                                                                

In the matter between:

CROCODILE MOUNTAIN INVESTMENTS

SWAZILAND (PTY) LTD                                                                   1st Applicant

ELLIOT MHLANGA                                                                           2nd Applicant

And

FLORENCE MNDZEBELE                                                                Respondent

 

In re:

FLORENCE MNDZEBELE                                                               Applicant

And

ELLIOT MHLANGA                                                                          Respondent

Neutral Citation:   Crocodile Mountain Investments Swaziland (Pty) Ltd vs   

                                Florence Mndzebele In re: Florence Mndzebele vs Elliot

                                Mhlanga [1422/13] [2018] SZHC 111 (1 June 2018)

 

Coram:      LANGWENYA J.

Heard:        9 March 2018

Delivered:  1 June 2018

 

Summary: Civil Procedure-urgent application for interdict of a prohibitory or restrictive nature-non-joinder and improper service-effect thereof-failure to controvert or refute opposing party’s allegations, effect thereof-umnumzane and a director and shareholder of a company-who has right to manage farm-import of failure to follow section 3 of Farm Dwellers Control Act on umnumzane. Costs-court’s discretion to award costs wide, unfettered and equitable-costs follow event versus punitive costs-when punitive costs awarded-Court must be satisfied that applicant’s conduct justifies order of punitive costs and that a party and party cost order will not suffice to meet the expenses incurred by the opposing party-in absence of evidence that cost order on normal scale will not be enough to meet the cost of successful party punitive costs not granted.

 

JUDGMENT

 

Introduction

[1]     This matter relates to the urgent application (main application) of 13 September 2013 and the interlocutory application of 19 September 2013. The parties in the main application are Florence Mndzebele and Elliot Mhlanga; the applicant and the respondent respectively. In the interlocutory application of 19 September 2013 the first and second applicants are the Crocodile Mountain Investment Swaziland (Pty) Limited and Elliot Mhlanga respectively. The respondent in the interlocutory application of 19 September 2013 is Florence Mndzebele. I will refer to the parties in the main application as Florence and Elliot. In the interlocutory application of 19 September 2013 I will refer to the first applicant as the Crocodile Mountain Company and the other parties will be referred to as in the main application.

 

[2]     The application of 19 September 2013 is interlocutory and was brought by the applicants to anticipate a rule nisi that was issued by this Court on 13 September 2013.

 

[3]     The background of this application is that upon a notice of motion under a certificate of urgency in terms of Rule 6 (25) of the High Court Florence obtained an order of this Court of MCB Maphalala J (as he then was) in the following terms:

(a) That the forms and time provided for by the Rules of the Court be dispensed with and that this matter be dealt with as an urgent matter in terms of the provisions of Rule 6 (25) of the Rules of the High Court.

  1.  Interdicting and/or restraining the Respondent and any other person acting at the stead of the Respondent from interfering and/or disturbing applicant from managing Rockford Farm situate at portion 14 Ngwenya Hhohho district forthwith.
  2. Interdicting and/or restraining the Respondent forthwith from threatening applicant, fellow farm dwellers and other community members at the Droxford farm situate at portion 14.
  3. A rule nisi is hereby issued returnable on 27 September 2013 calling upon the respondent (now 2nd applicant) to show cause why a final order in terms of prayers (a), (b) and (c) of the notice of motion should not be made final.

 

[4]     On 19 September 2013 the 2nd applicant approached the Court under the banner of a certificate of urgency and moved an application for an order in the following terms:

1) That the rules of the Court in respect of manner and service form and time limit be dispensed with;

2) The applicants’ non-compliance with the Rules of Court relating to form and) manner of service be condoned;

  1.  
  1.  A rule nisi is hereby issued calling upon the respondent to show cause on 27 September 2013 why an order in the following terms should not be made final:

 

4.1 The respondent and or all other persons acting under her behalf are hereby interdicted from cutting and selling trees on portion 14 (a portion of portion 1) of farm Droxford Estate No. 1007 situate at Ngwenya, Hhohho district;

4.2 The respondent and or all other persons acting on her behalf are hereby interdicted from interfering with the second respondent’s title to trees on portion 14 (a portion of portion1) of farm Droxford estate No. 1007 situated at Ngwenya, Hhohho district by virtue of being the shareholder and director of the first applicant;

3) That prayers 4.1 and 4.2 above operate with interim and immediate effect pending finalization of this matter.

  1.  The respondent is ordered to pay the costs of the application.
  2. Further and or alternative relief.

 

[5]     Subsequent to the application of 19 September 2013, the Court issued an order that all the parties and/or all persons acting under their behalf are hereby interdicted from cutting and selling trees on portion 14 (a portion of portion 1) of farm Droxford estate No. 1007 situated at Ngwenya, Hhohho district[1].

 

[6]      The record reflects that on 19 September 2013 when all the parties were interdicted from cutting and selling the trees from farm Droxford estate no. 1007, Mr. Manica, Florence’s attorney  undertook to file opposing papers to the respondent’s interlocutory application before the matter could be heard on 27 September 2013. There is, however nothing on the record to show  Florence’s attorney made good his undertaking. Consequently, the matter could not be heard on 27 September 2013 but was heard on 4 October 2013 without Mr. Manica having filed the opposing papers. Mr. Manica did not make an appearance in court on 4 October 2013.

 

[7]     On 4 October 2013 before Honourable Hlophe J, the court issued an order in the following terms:

            Having read papers filed of record and there being no opposition to the interlocutory application it is hereby ordered that:

          1. The respondent (Florence Mndzebele) and/or all other persons acting under her behalf are hereby interdicted from cutting and selling trees on Portion 14 (a portion of portion

               1)   of Farm Droxford estate no. 1007 situated at Ngwenya, Hhohho district.

              2)   The respondent and/or all other persons acting on her behalf are hereby interdicted from interfering with the second respondent’s title to trees on portion 14 (a portion of portion 1) of Farm Droxford estate no. 1007 situated at Ngwenya, Hhohho district by virtue of being the shareholder and director of the applicant.

           3.   The respondent is ordered to pay the costs of the application.

 

 

 

Factual Background

[8]      In the main application, the applicant and the respondent are resident at Portion 14 (a portion of portion 1) of Farm Droxford Estate No. 1007 situated in the district of Hhohho (hereinafter referred to as the farm). The Crocodile Mountain Investment Swaziland (Pty) Ltd (hereinafter called the Crocodile Mountain Company) is a body corporate established in terms of the company laws of Swaziland with its principal place of business at portion 14 (a portion of portion 1) of Farm Droxford Estate No. 1007 situate in the district of Hhohho and is the owner of the said farm. A deed of transfer in favour of the first applicant is attached.

            Notably, the Crocodile Mountain Company is not joined as a party in the main application.

 

[9]      The record reflects that on the farm there are gum trees which are used by Florence and Elliot as well as other farm dwellers for both commercial and domestic purposes. The respondent argues that he grows and tends the trees.

In the application of 19 September 2013, Elliot argues that he is a shareholder and a director of the Crocodile Mountain Company and is therefore entitled to administer, manage and control what goes on at the farm including cutting and selling the trees on the farm. Conversely, Florence argues that she was appointed an umnumzane[2] over the farm by Robert Macleverly-the latter being the owner of portion 14 (a portion of portion 1) of Farm Droxford estate no. 1007 situate in the district of Hhohho. Florence argues that as umnumzane, she has the right to manage the farm and to fell and sell the trees on the farm.

 

[10]    Ex facie the papers filed of record, Robert Macleverly is not the owner of the farm in question since he transferred his ownership through deed of transfer Number 212/1969 to the Crocodile Mountain Company. There is evidence that Robert Macleverly is also a Director of the Crocodile Mountain Company.

        What falls to be determined by this Court is who between the parties has a right to manage, administer and control the farm and the basis of this right in law. I will revert to this question later.

 

Ad Main Application of 13 September 2013

[11]    In the main application, Florence sought, among others, to interdict Elliot from interfering with her management of the farm. The Court granted the order prayed for in the absence of the respondent who had not been properly served and the Crocodile Mountain Company which had not been joined in the proceeding.

 

[12]      It appears from the record that on the granting of the rule nisi on 13 September 2013- Elliot and the Crocodile Mountain Company had no reasonable opportunity to be heard before the granting of the rule nisi. The interim interdict consisted of an order restraining Elliot and any other person acting at Elliot’s behest from interfering with the applicant’s management of the farm in issue. The interim interdict so granted is prohibitory or restrictive in nature in that it ordered the respondent to refrain from doing something.

 

[13]   When, Elliot anticipated the return date on 19 September 2013 it was his contention that the main application was not served on him personally as alleged by Mr. Manica in the affidavit of service. Elliot intimated that the main application was left with one Alfred Mavuso who only transmitted same to Elliot at 1900 hours and that was long after the Court had granted the interim order. Elliot avers further that the applicant did not join the Crocodile Mountain Company in the proceeding even though Florence was aware that the company was an interested party. Elliot’s version has neither been controverted nor refuted by Florence.

 

[14]   Where a party fails to deal with allegations by his opponent, the allegations by the opponent will be accepted as correct. In the matter of O’Linn v Minister of Agriculture, Water and Forestry[3], Muller said the following:

           [8] By electing not to answer the allegations made by the applicant in his founding affidavit by way of an answering affidavit, it follows that the facts raised in the applicant’s founding affidavit were not placed in dispute and should be accepted.

 

[15]   By electing not to answer the allegations made by Elliot in his founding affidavit of 19 September 2013, it follows that the facts raised by Elliot in the said founding affidavit were not placed in dispute and I therefore accept them as correct.

 

[16]   It is a basic principle of law that a Court should not at the instance of any party grant an order whereby any other party’s interests may be directly affected without formal judicial notice of the proceedings having first been given to such other party. It is a matter of fairness that all substantially and directly interested parties may be heard before the order is given; it is also so that the order may be binding on all parties whose interests its terms should affect-and this is a matter of sound judicial policy[4].

 

Non-Joinder: Effect thereof

[17]   According to the authorities cited above, it is mandatory for a party that institutes proceedings to join every other party that has a ‘direct and substantial interest’ in the relief sought. If the parties do not raise a point of non-joinder when it is clear there should be joinder of a party, the court should do so mero motu.

 

[18]   The undisputed evidence is that the Crocodile Mountain Company was not joined in the main application even though Florence was aware of its existence and that there is a deed of transfer of the farm to the said company.

[19]   Section 15 of the Deeds Registry Act[5] states the following:

                Save as otherwise provided in this Act or any other law, the ownership of land may be conveyed from one person to another only by means of a deed of transfer executed or attested to by the Registrar…

          The deed of transfer attached to Elliot’s founding affidavit of the application of 19 September 2013 reflects that through a deed of transfer number 212 of 1969 the farm in issue was transferred to Crocodile Mountain Investments (Swaziland) Pty Ltd by Robert Hugh Findlay Macleverty.

 

[20]   Viljoen[6] states that a deed of transfer serves as proof of ownership of property and that as soon as the deed of transfer executed is submitted to the Registrar of Deeds, the person to whom the property is being transferred becomes the owner of the property.

 

[21]   If the contents of the deed of transfer are anything to go by, the Crocodile Mountain Investment Company and not Macleverty is the owner of the property. This fact has neither been denied nor controverted by Florence. Elliot argues that he is a director and shareholder of the company-this fact has also not been controverted by Florence. Elliot has annexed the Crocodile Mountain company documents marked ‘EM 2’ which reflect that Elliot is a director and shareholder of the company. Elliot asserts further that he pays company licence fees on behalf of the Crocodile Mountain Company on a yearly basis and has annexed a copy of the company renewal form marked ‘EM 3’.

 

[22]    Annextures ‘EM 1’, ‘EM 2’ and ‘EM3’ prima facie prove that the Crocodile Mountain Company has a ‘direct and substantial interest’ in the proceedings and ought to have been joined by Florence in the main application. Precisely what constitutes ‘a direct and substantial interest’ is not easy to define. In Amalgamated Engineering case and in Strydom v Engen Petroleum Ltd[7] it was held that issues of joinder should not depend on the nature of the subject matter of the litigation, but on the manner in which, and the extent to which the court’s order may affect the interests of a third party. Differently put, the criterion is the realistic possibility, not the certainty, that the interests of a third party might be substantially and directly affected that is paramount. In the case at hand, I am of the view that the respondent in the main application is entitled to require the joinder of the Crocodile Mountain Company as it is evident that the Company has a sufficiently direct and substantial interest in the litigation in the sense that any order made in it may prejudicially affect its rights as the owner of the farm in issue.

 

[23]    Since the defence of non-joinder or mis-joinder is dilatory[8] and where it is upheld the action is not dismissed but is stayed until the proper party has been joined, I am of the view that the Court should be slow to dismiss the proceedings in the event it finds that a necessary party has not been joined. The Court should rather stay the proceedings or better still, order that the said party be joined and accordingly, the notice of the proceedings should also be properly brought to the attention of such a party. An appropriate order of costs may also be made resulting from the postponement or stay necessitated by the non-joinder.

 

[24]   In my understanding of Elliot’s submissions he does not so much argue that the main application ought to be dismissed as much as he makes an observation that the Crocodile Mountain Company was not joined in the proceedings. Since the Company was subsequently joined by Elliot in the interlocutory application of 19 September 2013-an application that has a bearing on the main application, any pursuit of the issue of non-joinder, at this stage is, in my view superfluous.

 

No proper service to Elliot in the main application

[25]   The rule regarding anticipation of the return date was intended to avoid and or mitigate the prejudice to a litigant who is faced with an interim order, which may be in the form of an interim interdict without having a reasonable hearing. In the case at hand it is Elliot’s case that the main application was not served on him as alleged by Mr. Manica. According to Elliot, the court papers were served on one Alfred Mavuso who gave Elliot the papers at 1900 hours-long after the order was granted on the day the matter was heard. Without  the main application being properly served on the respondent and then expecting the respondent and or his attorney to make a proper and sufficient response, is, in my view an abrogation of the audi alteram partem rule, a principle that has been described by the Supreme Court of South Africa as ‘sacred’.

 

[26]   It is Elliot’s contention that the farm and the trees thereat are owned by Crocodile Mountain Investments Swaziland (Pty) Ltd, a company that Elliot is a director and shareholder of. The respondent states that he is responsible for planting and tending to the trees that Florence is cutting, felling and selling without his permission and consent. In his founding affidavit, Elliot stated that Florence is a squatter on the farm and was allowed by Macleverty to stay in the main house on the farm after her shelter was destroyed by her step-children when her husband (Simon Maseko) died. It was Elliot’s version that Florence was allowed to stay in the main house temporarily since she was expected to move out of the main house once she found an alternative place to stay.

 

[27]   Elliot states further, that in the year 1987 Macleverty informed him that he was relocating to South Africa and that Elliot would be in charge of the farm as ‘sole owner[9]’. It is Elliot’s version that he was given the original deed of transfer of the farm and other company documents relating to the farm. Elliot states that he pays company licence fees yearly as a result of the instruction from Macleverty. Elliot argues also that he is a shareholder and director of the Crocodile Mountain Investments Swaziland (Pty) Ltd.

 

[28]   In the absence of Florence’s answering papers to Elliot’s averments in his interlocutory application of 19 September 2013, the version of Elliot has neither been contradicted nor refuted by Florence as such it is accepted by this Court to be correct.

 

[29]   When the matter was argued before me on 9 March 2018, Mr. Manica, submitted that there were answering papers refuting Elliot’s version and undertook to furnish the Court with those papers by close of business of Tuesday 13 March 2018. As of June 1 2018-the date the judgment is delivered, Mr. Manica has not made good his undertaking. Such conduct coming from an officer of the Court must be deprecated.

 

Title over the Farm

[30]   Florence claims to be umnumzane and indvuna at the farm in question. She asserts that she was appointed umnumzane by Robert Macleverty in 1982 during the funeral of her husband. To support her assertion, she places reliance on the provisions of the Farm Dwellers Control Act[10] and on supporting  affidavits filed by Shadrack Dlamini and Mhlanganiso Mavuso. It is the case of the applicant that by virtue of being umnumzane/indvuna of the farm in question she has the right and power to administer, manage and control the happenings in the farm and this includes the felling, cutting and selling of the trees on the said farm.

[31]   The Farm Dwellers Control Act defines umnumzane as:

                 [A] person recognized by Swazi law and custom as the head of a homestead             and includes a woman[11].

Section 3(1) of the Farm Dwellers Control Act states as follows:

3.  (1) An umnumzane who-

(a) immediately before the date of coming into operation of this Act, is a farm dweller; or

(b) at any time after the date of coming into operation of this Act, is permitted by the owner of a farm to reside thereon;

Shall within ninety days of such date or of such permission being granted, be deemed to be entitled to an Agreement and shall take reasonable steps to have an Agreement entered into within the said period.

 

[32]   The language of section 3 above is peremptory. Umnumzane shall sign a farm           dwellers agreement with the owner of the farm. It has not been shown in the           papers filed of record that such an agreement exists nor that it was filed. If the           agreement exists, it has not been explained why it has not been filed. The           logical conclusion is that if the applicant in the main application is without the           agreement required by section 3 of the Farm Dwellers Control Act, she cannot           legitimately be viewed as umnumzane of the farm in question. That there are           supporting affidavits from other people stating that Florence is umnumzane is a factor, in my view which cannot be allowed to trump the said provision of        the Farm Dwellers Control Act.

[33]   It is my view therefore that for the reasons set out above, it has not been shown that Florence has a clear right or a prima facie right over the farm. This is reason enough for me to discharge the interim relief granted by this Court on 13 September 2013.

 

Prima facie Right

[34]   It is one of the requirements of an interim interdict that the applicant must show that he/she has a prima facie right. I have to consider whether Florence has in her founding papers furnished proof which if uncontroverted and believed at the trial would establish her right. Notably, more is required than merely to look at the allegation of the applicant (in the main application) although something of a weighing up of the probabilities of conflicting versions is required[12].

 

[35]    I have considered the facts as set out by Florence in the main application together with the facts set out by Elliot in the interlocutory application of 19 September 2013 which the former cannot dispute and I have decided that the facts set up in contradiction by Elliot throw serious doubt on Florence’s case and she cannot therefore succeed.

 

[36]    I will not wade into the issue of ownership of the farm because I am satisfied that the deed of transfer of the farm to Crocodile Mountain Company shows  prima facie that the farm is registered in the name of the Company. I am also satisfied that on the face of the documents attached to Elliot’s founding affidavit in the interlocutory application of 19 September 2013 he prima facie has shown that he is a director and shareholder of the Crocodile Mountain Company. A director and shareholder of a company is well within his rights to manage the farm in a way that would entail doing what the interim order of 13 September 2013 forbids him to do.

 

Costs

[37]    I now turn to the issue of costs. It is trite that except in specific instances where a statute so stipulates, all awards of costs are in the discretion of the Court. The discretion must be exercised judiciously regard being had to all relevant considerations. While the discretion of the Court is wide and unlimited, it is also an equitable one[13]. The general rule is that costs follow the event; that is the successful party should be awarded his or her costs. The general rule will apply barring special circumstances present in a particular case. Costs are ordinarily ordered on a party and party scale.

 

[38]    It is only in exceptional circumstances and consequent to a discretion properly and judicially exercised is a party ordered to pay costs on a punitive scale.

            Elliot submits in his interlocutory application of 19 September 2013 that the Court should award him costs at a punitive scale.

           The basis for costs at a punitive scale was outlined by the Court in Nel v Waterberg Landbouwers Ko-operatiewe Vereeniging[14] in the following words:

 

[39]   The true explanation of awards of attorney and client costs not expressly authorized by Statute seems to be that, by reason of special considerations arising either from the circumstances which gave rise to the action or from the conduct of the losing party, the Court in a particular case considers it just, by means of such an order, to ensure more effectually than it can do by means of a judgment for party and party costs that the successful party will not be out of pocket in respect of the expense caused to him by the litigation.

          The case of Multi-Links Telecommunications Ltd v Africa Prepaid Services Nigeria Ltd[15] is instructive as can be seen from the following words uttered by Fabricius J:

 

[40]   I think it is the wrong approach to analyse each and every criticism of the launching of the attachment application individually, and then deciding whether or not it, by itself ought to result in a special costs order. In any view a balanced view of the whole of the proceedings and the relevant facts ought to be taken. If a court is left with the indefinable feeling, which feeling must, however be based on rational analysis of the facts and legal principles, that something is ‘amiss’, if I can put it that way, it may justify that feeling by deciding that the opposing party ought not be out of pocket as a result of the application having been launched.

 

[41]   Flowing from the above authorities is a conclusion that the Court must be satisfied that the conduct of the applicant (in the main application) justifies such an order and that a party and party cost order will not suffice to meet the expenses incurred by the opposing party. These requirements go together.

 

[42]   Although I am satisfied as to the first requirement-ie that the conduct of Florence justifies such an order as she initiates the main application but fails to file answering papers and does not advance reasons for such failure except to undertake to file same but does not do so; the respondent in the main application has not placed evidence before me to satisfy me that a cost order on the normal scale will not be sufficient to meet his costs in opposing the main application. Accordingly, I will not grant a punitive costs order against the applicant in the main application.

 

 

 

Order

[43]    Accordingly, I make the following order:

  1. The rules of the Court in respect of manner, service, form and time limits is dispensed with.
  2. The applicant’s non-compliance with the Rules of the Court pertaining to form and manner of service is condoned regarding the interlocutory application of 19 September 2013.
  3. The rule nisi granted by the Honourable MCB Maphalala J (as he then was) on 13 September 2013 is hereby discharged.
  4. The respondent in the interlocutory application of 19 September 2013 and or all other persons acting on her behalf are hereby interdicted from cutting and selling trees on Portion 14 (a portion of portion 1) of Farm Droxford Estate No. 1007 situate at Ngwenya, Hhohho district.
  5. The respondent in the interlocutory application of 19 September 2013 and or all other persons acting on her behalf are hereby interdicted from interfering with Elliot Mhlanga’s management and title to the trees on Portion 14 (a portion of portion 1) of Farm Droxford Estate No. 1007 situated at Ngwenya, Hhohho district by virtue of being a director and shareholder of the Crocodile Mountain Investments Swaziland (Pty) Limited.

 

 

 

 

  1. Costs to follow the result.

 

 

 

_________________________

M. LANGWENYA

JUDGE OF THE HIGH COURT

 

For the Applicants:   Mr. D. Jele

For the Respondent:  Mr. D. Manica

 

[1] The order was issued by Mabuza J (as she then was) on 24 September 2013.

[2] According to section 2 of the Farm Dwellers Control Act, 1982 umnumzane ‘means a person recognized by Swazi law and custom as the head of a homestead and includes a woman’.

[3] 2008 (2) NR 792 (HC) at 795F-G

[4] See: Amalgamated Engineering Union v Minister of Labour 1949 (3) SA 637(A); Rosebank Mall (Pty) Ltd and Another v Cradock Heights (Pty) Ltd 2004 (2) SA 353 (W) at paragraph 9-41.

[5] No. 37/1968.

[6] See Viljoen, Sanette ‘What is a deed of transfer and what does it contain’ https://finasies.solidariteit.co.za/en/deed-transfer-contain/ (accessed 29/5/18).

[7] 2013 (2) SA 187 (SCA) at paragraph 44.

[8] Herbstein and Van Winsen, The Civil Practice of the Supreme Court of South Africa 4th edition, 1997, at page 187.

[9] See paragraph 7.7 of Elliot Mhlanga’s founding affidavit, pages 34-35 of the Book of Pleadings.

[10] 1982.

[11] See Section 2

[12] Webster v Mitchell 1948 (1) SA 1186 (W) at 1189.

[13] Inter continental Experts (Pty) Ltd v Fowles 1999 (2) SA 1045.

[14] 1946 AD 597

[15] 2014 (3) SA 265 (GP) at 290.