Judgment No. HB 36/15
Case No. HC 2070/14
X REF HC 1723/14
BULAWAYO CITY COUNCIL
BUTTON ARMATURE WINDING (PVT) LTD
IN THE HIGH COURT OF ZIMBABWE
BULAWAYO 3 & 26 FEBRUARY 2015
M. Ndlovu for the applicant
S. Chamunorwa for the respondent
Opposed Court Application
MUTEMA J: This is an application for summary judgment in the sum of US$86 927,90 said to represent arrear rates for the period spanning from June, 2012 to June, 2014. The statement for the bill for what applicant contends is owed was attached to the founding affidavit as annexure “A”. The founding affidavit was deposed to by one Spekiwa T. Guta, who in paragraph 1 thereof stated:
“1. I am the city legal officer of the applicant in this matter and all the facts I depose hereto are to the best of my knowledge true and correct.”
Over and above the amount claimed stated above, the applicant, in the draft order, also seeks an order for collection commission on the said amount, interest at the prescribed rate, costs of suit on an attorney-client scale.
The application was opposed on the following grounds:
- the deponent to the founding/supporting affidavit did not establish authority to depose to the affidavit or that the facts she deposed to are with her knowledge;
- the relief sought for collection commission is incompetent;
- in the draft order applicant is seeking interest at the rate of 5% per annum yet annexure “A” shows that interest was being charged on the account at 6% per month. In the result, the interest that was levied on the account was therefore unlawful; and
- the claim is defective for want of compliance with Rule 13 (4) of Order 3 of the High Court Rules 1971 in that it does not set out separately the interest component from the capital sum.
On the merits
- the respondent has a bona fide defence as advanced in the preceding points in limine;
- via publication in the press, applicant offered a special dispensation whereby if respondent paid off half the amount owed, the other half would be written off. Respondent accepted the offer and the arrangement became binding on the parties and the agreement is still to run its course;
- the calculations in annexure “A” are flawed. They are effective from February, 2009 to July, 2014 yet the claim avers that the period runs from June, 2012 to June, 2014 and is for arrear rates only but annexure “A” factored in water levy, rates, road levy, sewage, solid waste and monthly interest of 6%. This informs on the question of whether or not part of the claim has not prescribed as well as the accuracy of the computation of the amount due.
It is proposed to deal first with the points raised in limine.
WHETHER DEPONENT TO FOUNDING/SUPPORTING AFFIDAVIT HAS AUTHORITY TO DEPOSE TO IT OR ESTABLISHED KNOWLEDGE OF FACTS DEPOSED TO
An application for summary judgment is governed by Rule 64 of Order 10 of the High Court Rules 1971. The requirements for a supporting affidavit are captured in sub rule (2) which provides:
“(2) A court application in terms of sub rule (1) shall be supported by an affidavit made by the plaintiff or by any other person who can swear positively to the facts set out therein, verifying the cause of action and the amount claimed, if any, and stating that in his belief there is no bona fide defence to the action.”
In response to respondent’s contention that the deponent to the supporting affidavit filed by the applicant herein had no authority, the applicant relied on the case of African Banking Corporation of Zimbabwe Limited t/a BancABC v PWC Motors (Pvt) Ltd & 3 others HH-123-13. In that case MATHONSI J held as follows:
“I am aware that there is authority for demanding that a company official must produce proof of authority to represent the company in the form of a company resolution. However, it occurs to me that that form of proof is not necessary in every case as each case must be considered on its merits: Mall (Cape) (Pvt) Ltd v Merino Ko-Opraisie BPK 1957 (2) SA 345 (C). All the court is required to do is satisfy itself that enough evidence has been placed before it to show that it is indeed the applicant which is litigating and not the unauthorized person.
To my mind the attachment of a resolution has been blown out of proportion and taken to ridiculous levels. Where the deponent of an affidavit states that he has the authority of the company to represent it, there is no reason for the court to disbelieve him unless it is shown evidence to the contrary [but] where no such contrary evidence is produced the omission of a company resolution cannot be fatal to the application …”
I respectfully subscribe to my brother MATHONSI J’s views expressed supra. I would add that that approach has now become the commonly applied one in this jurisdiction when dealing with the subject under discussion.
I, however, do not agree with Mr Ndlovu for the applicant that the application before me is supported by the case he cited. He must have read piece meal what was stated in that case. I am persuaded by Mr Chamunorwa’s pertinent observation that the Banc ABC case supra which Mr Ndlovu sought to rely on for his contention, is distinguishable in that in casu, the deponent has not averred that she has the applicant’s authority to depose to the supporting affidavit or to launch the application for summary judgment. This can be gleaned from paragraph 1 of her supporting affidavit. In the absence of corporate resolution an averment by Guta that she has authority to depose to the supporting affidavit was essential and its absence is fatal. In the event, I will uphold the point in limine, hence there is no application for summary judgment before the court. The other prong of the point in limine that the deponent did not establish knowledge of the facts was not pursued. It therefore need not detain me.
WHETHER THE RELIEF SOUGHT FOR COLLECTION COMMISSION IS COMPETENT
This relief is contained in paragraph 2 of the draft order. The applicant, in its heads of argument, conceded that it is not entitled to collection commission. Accordingly applicant indicated that it was abandoning that claim.
The concession was properly taken in view of the case of Scotfin Ltd v Ngomahuru ex parte Law Society of Zimbabwe: In Re Scotfin Ltd v Ngomahuru 1998 (3) SA 466 (ZH) which outlawed recovery of both collection commission and attorney – client costs in the same claim unless the delinquent debtor had agreed to pay both charges in the main agreement and only in respect of trade debts and uncontested claims. This point in limine had therefore been validly raised.
WHETHER THE 6% PER MONTH INTEREST CHARGED IN ANNEXTURE ‘A’ WAS LAWFUL
This point should not have been raised as a point in limine. It goes to the root of part of respondent’s defence as it hinges on the merits.
The applicant’s attempt to justify this rate of interest was convoluted. It did not nail its colours to the mast as in one breath it alleged the 6% rate of interest was per annum yet annexure “A” to the supporting affidavit clearly shows that it was being levied per month which is clearly illegal.
In the heads of argument, in paragraphs 15 and 16 the applicant contended thus:
“15. The applicant is charging 6% interest per annum on outstanding arrears in terms of section 274 (2) of the Urban Councils Act. Section 274 (2) reads as follows:-
“…the council may charge and recover interest thereon reckoned from the due date at such rate as may be fixed by the Council which is not more than one per centum per annum above the rate of interest charged by the State in respect of loans made to local authorities at the time the rate was fixed in terms of subsection (1).”
16. In the premises, the applicant is charged 5% interest per annum by the State in respect of loans made to local authorities. Accordingly it is entitled to charge 6% per annum on outstanding arrears.”
However, in paragraph 14 of its Heads applicant had contended that the 6% interest per annum was levied in terms of its by-laws.
Given the exitant contradictions regarding this issue, coupled with the fact that section 274 (2) of the Act was never pleaded in the summons and that the rate of interest levied by government on loans advanced to applicant is not trite, there is a material factual dispute which cannot be determined at this stage no matter how bold the approach the court takes.
CLAIM DEFECTIVE FOR WANT OF COMPLIANCE WITH RULE 13 (4) OF ORDER 3 OF THE HIGH COURT RULES 1971
Rule 13 (4) provides as follows:
“(4) Subject to sub rule (5), where the amount claimed includes capital and interest on the capital, the particulars endorsed on the summons in terms of sub rule (1) shall state clearly –
(a)the capital amount claimed; and
(b)the total amount of interest claimed on the capital as at the date of the summons or as at an earlier date specified in the particulars; and
(c)whether or not interest is claimed on the total amount of capital and interest referred to in paragraph (a) and (b) and, if not, the amount in respect of which any interest is claimed and the date which interest is to run.”
It is not disputed that the claim as particularized in the summons does offend against the provisions of Rule 13 (4) quoted above. The amount of interest claimed on the capital is not stated and also the effective date from which interest is supposed to run.
On the merits
It is trite that in an application for summary judgment, all that a respondent has to show “in order to succeed in having the application dismissed is that there is a mere possibility of his success, he has a plausible case, there is a triable issue or there is a possibility that injustice may be done if summary judgment is granted.” See Jena v Nechipote 1986 (1) ZLR 26 (SC)
Two points in limine have been upheld and are enough to dismiss the application on that basis but out of an abundance of caution there is no harm or prejudice in delving into the merits. Over and above what has been dealt with and proven under points in limine supra which is interwoven with respondent having a bona fide defence in casu there are two issues raised by the respondent which clearly engender material disputes of fact which cannot be resolved on the papers.
The first relates to the averment that via publication in the press, applicant offered a special dispensation whereby if respondent paid off half the amount owed, the balance would be written off. Respondent accepted the offer, the arrangement became binding between the parties and that agreement has not expired. It is not enough for applicant to simply allege, in passing, that respondent has not furnished such proof as alleged in an endeavour to dispute the allegation. If applicant could not have been aware of this allegation at time of filing the application then in terms of Rule 67 (c) of the High Court Rules 1971 the applicant should have applied to supplement its affidavit with a further affidavit to cover that lacuna. The fact it did not do so can safely be inferred to mean that the averment was not being disputed.
The second and more cogent relates to exact amount respondent allegedly owes the applicant if account is had to annexure “A”. The claim avers that the amount owed is for rates arrears in the sum of $86 927,90 from June 2012 up to June, 2014. However, a perusal of annexure “A” reveals that applicant’s computation of the amount claimed is effective from February, 2009 up to July, 2014. Over and above that, ex facie annexure “A”, it is apparent that applicant factors in water levy, road levy, sewerage, solid waste and the monthly interest of 6% in addition to the rates. As correctly argued by respondent, this brings into sharp focus the question of whether or not part of the claim has not prescribed and also the accuracy of the computation of the exact amount that is due.
Given the forgoing material disputes of facts, it is quite clear that respondent has a bona fide defence to applicant’s claim and in the result the application for summary judgment is dismissed with costs.
Mlweli Ndlovu & Associates, applicant’s legal practitioners
Messrs Calderwood, Bryce Hendrie & Partners, respondent’s legal practitioners