jj bosman supreme court of appeals
TRANSCRIPT
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[1]
NOTICE OF MOTION
IN THE SUPREME COURT OF APPEAL OF SOUTH AFRICA
Case Number: ..
Court a quo case number: 22113/2011
In the matter between:-
JACOBUS JOHANNESS JOUBERT BOSMAN Applicant
~and~
THE STANDARD BANK OF SOUTH AFRICA LIMITED Respondent
SUPPORTING AFFIDAVIT
I,
JACOBUS JOHANNESS JOUBERT BOSMAN
do hereby state under oath as follows;
i. I am the Applicant in this matter and duly authorised to depose to this affidavit and tobring this application.
ii. The facts herein contained are, save where the contrary appears from the context, withinmy personal knowledge, to the best of my belief both true and correct, and I can and do
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swear positively thereto. Where I make legal submissions, I rely on advice that I have
received from my legal representatives.
iii. I have acted in my personal capacity throughout proceeding before this application andindent doing so with the leave of the Honourable Court.
iv. I am current residing at 328 Grus street Waterkloof Ridge PRETORIA, Postal Address,P. O. Box 95709 Waterkloof 0145 with contact details as follows, telephone number: 082
4414652, fax number: 0865147368 and email address: [email protected].
OVERVIEW:
1. The Applicant herein had unsuccessfully lodged an application for leave to appeal beforethis Honourable Court which was heard by the Honourable Judge C P Rabie on the 15th of
March 2012, the grounds of appeal which are annexed hereto as JJJ 1.
2. On the date of the hearing of the Appeal, the Applicant herein prepared and handed to theHonourable Judge a copy of its presentation, annexed hereto as JJJ 2.
3. In relation to the above, the Applicant had contended, and in these premises persist tocontend that the Respondent had failed to show proper cause that it has properly dispensed
with its obligation in terms of Rule 18 of the Uniform Rules of Court and where the
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Respondent was obliged and required to produce documents to prove or disprove
allegations made by the Applicant against the Respondent, had failed to produce same.
4. The reasoning and contention held by the Respondent was that it was not obliged norrequired to produce any such documents as the agreement of loan and covering
mortgage bond was sufficient and suffice to properly dispose of the Respondents burden
of proof.
SUMMARY JUDGMENT:
5. The Uniform Rules of Court, Rule 32(2) make provision for , together with an affidavitmade by himself or by any other person who can swear positively to the facts verifying the
cause of action and the amount, if any, claimed and stating that in his opinion there is no
bona fide defence to the action and that notice of intention to defend has been
delivered solely for the purpose of delay. and further If the claim is founded on a
liquid document a copy of the document shall be annexed to such affidavit
5.1 In the matter of FirstRand Bank Ltd v Beyer 2011 (1) SA 196 (GNP) after an
analysis of Rule 32(2) of the Uniform Rules of Court clearly shows that the court,
before it can grant summary judgment, must from the facts set out in the verifying
affidavit itself, be able to make a factual finding that [a] the person who deposed
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to the affidavit was able to swear positively to the facts alleged in the summons
and annexures thereto and [b] be able to verify the cause of action and [c] the
amount claimed, if any, and be able to [d] form the opinion that there was no
bona fide defence available to the defendant, and that the [e] notice of intention to
defend was given solely for the purpose of delay.
5.2 Juristic entities, like that of the Respondent, whom authorise employees to
dispense and swear to the correctness of averments in an affidavit are to state how
it obtained such authority. It follows that such authority must also be annexed to
such affidavit. In this instance the Respondent had failed, neglected and/ or
refused to address this requirement, therefore the application for summary
judgment should have failed.
In the alternative;
5.3 Paragraph 6 of the Respondents loan agreement inter alia provides as follows:
The nature and amount of any indebtedness of the Mortgagor to the Bank shall
at any time be determined and proved by a written certificate purporting to have
been signed by a manager or accountant for the time being of any branch or the
head office of the bank . . .
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[5]
Insofar as the loan agreement alleges the Certificate of Balance purports to be a
liquid document, there is no indication that the signatory, one Kervin Govender, is
a manager of a branch or head of the Respondent, since he is merely indicated as
Home Loans Legal Manager.
I submit that Legal Recoveries/ Legal Manager is not a branch of the bank as
contemplated in paragraph 6 of the Respondent loan agreement and therefore
the application for summary judgment should have failed.
6. The Respondent had caused the registration of a Covering Bond, which includes anAcknowledgement of Debt. In accordance with the findings ofThienhaus v Metje
and Ziegler Ltd, 1965 (3) SA 25 (A) the court pointed out that, in practice, mortgage
bonds serve three purposes, viz, [a] to create a security interest, [b] to record the
details of the obligation secured, and to [c] create a contractual debt. Williamson JA
explained (at 31):~ clearly a mortgage bond can be utilised both as an instrument of
hypothecation and as a record of the terms and conditions of the obligation in respect
of which the hypothecation is to create a security; in addition it is a matter of
common and usual custom in the drafting of bonds to incorporate therein an
unqualified admission of liability by the mortgagor. The reason therefor is, however,
certainly not that such an acknowledgment is required for the validity of the bond as
a means of creating a real right by hypothecation in favour of the creditor. The origin
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and the prime purpose of the custom is the facilitation of the obtaining of a quick and
easy remedy, such as provisional sentence, against the mortgagor in case of his
default;
6.1 In contrast, Section 90 of the National Credit Act, 2005, prohibits any contract tocontain an acknowledgement of debt;- Section 90(1) read with (2)(a)(i), (ii)
(b)(i) and (c)(i);
6.2 Furthermore the inclusion of an acknowledgement of debt in the mortgagebonds, signed and authorised by an agent of the Respondent, on behalf the
Applicants power of attorney defeats the ends of justice and is a direct
contravention of the Consumer Affairs (Unfair Business Practice) Act, 1988;
6.3 Having regard to the above, such actions are contra bona mores, prejudicial andremoves all common law defences the Applicant could raise. This is evident in the
proceedings before this application. Therefore the Respondents application for
summary judgment had to fail.
7. The standard terms and condition of the Respondent declares the renouncement of allbenefits from the exceptions which might or could have been pleaded insofar it places a
bar to any claim the Respondent has under the mortgage bond. These presences are in
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contravention of Section 90 of the National Credit Act, 2005, Section 90(1) read with
(2)(a)(i), (ii) (b)(i) and (c)(i). Therefore, the Applicant was barred from raising and
entering its plea.
8. Contrary to the provisions of Rule 14(2)(b), Respondent has failed and/ or neglected toannex the liquid documents, including the accompanying Powers of Attorney, as an
annexure to the Deponents purported Affidavit. Therefore, the summary judgment had to
fail.
9. The State President has, in terms of section 10 of the Justice of the Peace andCommissioners of Oaths Act, 1963 (Act 16 of 1963), made the following regulation
referred to in the jurat of the deponents Affidavit, i.e. Government Notice No. R.1258
dated 21 July 1972, as amended by Government Notice No. R.1648 dated 19 August 1977,
and as further amended by Government Notice No. R.1428 dated 11 July 1980 and by
Government Notice No. R.774 dated 23 April 1982 (the Regulations).
9.1 Regulation 1-1 provides as follows:
An oath is administered by causing the deponent to utter the following words: I
swear that the contents of this declaration are true, so help me God.
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9.2 I have good reason to believe that the Commissioner never administered the oath
by causing the Deponent to utter the following words: I swear that the contents
of this declaration are true, so help me God.
9.3 That wording does not appear from the jurat. If in truth and in fact the Deponent
uttered the words I swear that the contents of this declaration are true, so help
me God, therefore the Respondent has not complied with the requirements so set
forth aforesaid. Having failed to do so, therefore Regulation 1-1;-
9.3.1 is peremptory;
9.3.2 the non-compliance thereof renders the deponents attestation void; and
9.3.3 the non-compliance thereof deprives the deponents purported Affidavit of
its validity as an Affidavit.
10. The Respondent s Affidavit does not comply with the provisions of Rule 14(2)(a) of theRules of Court, in that the Deponent cannot swear positively to the facts, verifying the
cause of action and the amount claimed, in that the Deponent has no personal knowledge
of the registration of the First and Second Bonds nor the Certificate of Balance, Annexure
JJJ 3 attached to the Respondents application for Summary Judgment;
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10.1 In order to attend to comply with the provisions of Rule 32(2) of the Rules of
Court, the Plaintiff is obliged to file a Supporting Affidavit of personal
knowledge deposed to by the Deponent;
10.2 The Applicant denies that the Deponent has personal knowledge and is able and
capable to verify the cause of action and the facts required by Rule 32(2) of the
Rules of Court.
10.3 The Applicant denies that Anthony Lorcan Kennedy is duly authorised to depose
to the Affidavit and bring an application for summary judgment;
10.4 Anthony Lorcan Kennedy has failed and/ or neglected to attach a Resolution from
the Board of Directors of the Respondent authorising him to depose to this
Affidavit and to bring an application for summary judgement.
10.5 The Applicant therefore denies that Anthony Lorcan Kennedy, in the absence of a
Resolution by the Board of Directors of the Respondent, is authorised to depose to
the purported Affidavit.
10.6 The Applicant denies that the facts referred to in Respondents Particulars of
Claim dated 6 April 2011 are within the personal knowledge of Anthony Lorcan
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[10]
Kennedy. The Applicant repeats that the employees of Respondent mentioned
above have failed to file Confirmatory Affidavits in support of the Application for
Summary Judgment. I reiterate my third point supra.
10.7 In this regard, the matter of Land and Agricultural Development Bank of South
Africa t/a The Land Bank v The Master and Others 2005 (5) SA 235 (c) in
terms of s 33 of the Land and Agricultural 952 Development Bank Act 15 of 2002
for recovery of moneys owing to a Bank not constituting management of 'the day
to day affairs of the Bank' as contemplated in s 18 of the Act - Board or chief
executive officer should therefore provide court with authority to institute such
litigation by properly authorised resolution in terms of s 16 of Act In
comparison see the definition of The business of a bank as defined in the Bank
Act, 94 of 1990, as amended.
10.8 For these reasons the Respondents application for summary judgment had to fail.
11. The Applicant signed a Power of Attorney on behalf of the Respondent to register the bondover the property as security, but the Respondent failed to annex same to their application,
despite same being requested. The Respondent failed to produce same therefore a copy of
the Power of Attorney cannot be annexed to this application, however, the following
averments could have been made if the said Power of Attorney was presented;-
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11.1 Ex facie the Power of Attorneyit is clear that the name of the Conveyancer and/or alleged Appeared, person appearing had been added by rubber stamp/ deleted
by drawing a line through the name of the original appearing person and
replaced with another person to the Power of Attorney subsequent to the
registration of the bond;
11.2 At the time of signature the Power of Attorney did not contain the name ofanother person. The name of another person was clearly rubber stamped/
deleted by drawing a line through the name of original person onto the Power of
Attorney after signature thereof by the Applicant, without knowledge or consent.
The Applicant did not authorise another person to register the Bond. The Bond
is therefore invalid.
11.3 In the event of it being contended by the Respondent that another person wassubstituted by the power of substitution vested in the Conveyancers mentioned in
the Power of Attorney and that the Bond is therefore valid, the Applicant avers as
follows:
11.3.1 Section 2(1) of the Alienation of Land Act, Act No. 68 of 1981 (theAOL Act) provides as follows:
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No alienation of land (after the commencement of this section) shall,
subject to the provisions of section 28, be of any force or effect unless it
is contained in a deed of alienation signed by the parties thereto or by
their agents acting on their written authority.
In section 1(b) of the AOL Act, the definition of land includes
any interest in land . . . .
11.3.2 A Deed of Substitution for the purpose of registration of a MortgageBond over the property is an interest in land and must therefore be in
writing.
11.3.3 another person clearly never received a written Deed of Substitutionby any one of the Conveyancers mentioned in the Power of Attorney
because such Deed of Substitution must be filed with the original Power
of Attorney in the Deeds Office, Pretoria, which it is not.
11.3.4 In the absence of such a written Deed of Substitution, the Bond istherefore invalid.
12. It is clear that strict compliance with the provisions of Rule 32(2) is required for asummary judgment to become a final judgment, unless reversed on appeal. A summary
judgment is an extremely extraordinary and drastic remedy, often referred to as a
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draconian measure. It shuts the mouth of the defendant finally. A party who seeks to
avail himself of this drastic remedy must comply strictly with the requirements of the rule.
(Paragraph [11] at 200D - E.)
12.1 It is so that the court has the power to condone mere technical non-compliance
with the provisions of Rule 32(2), but cannot condone non-compliance with the
safeguards built into Rule 32(2) for the benefit of defendants, for instance
regarding hearsay evidence and the doing away with, or the relaxation of the test
to be applied by every court, considering an application for summary judgment to
be able, on the evidence adduced in the affidavit, to make a factual finding that
the deponent was a qualified deponent, otherwise it would make a mockery of the
said safeguards. See Paragraph [17] at 202E938 G.
12.2 a Court cannot condone non-compliance with safeguards built into a Rule 32(2)
established for the benefit of Defendants. This was, with respect, an oversight of
the Court, a quo, analysis of the facts.
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THE APPLICANTS FUNDAMENTAL CONTENTION
THE BUSINESS OF THE BANK:
13. The Bank Act, Act 94 of 1990 specifically excludes the bank from engaging insecuritisation where it is the holder of such security or has a vested interest in such
security. The latter averment was emphasised by notice in the Government Gazette [No.
30628, Volume 511, January 2008] which amends the Bank Act by changing the business
of a bank ~ [Section 1, definition] to exclude securitisation from the business of the
bank.
14. Furthermore a Bank is precluded from using its clients deposits for loans and arefurthermore restricted in how it utilises its allocated capital and reserve funds and other
funds in terms of Sections 70(2), 70(2A) and 70(2B). These prescriptions follow through
and are further defended in the South African Reserve Bank Act, Act 90 of 1989.
15. Commercial banks, like the Respondent, invest their money with the South AfricanReserve Bank and the interest received on such investments is called seigniorage.
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15.1 Ordinarily seigniorage is an interest-free loan (historically of gold) to the issuer of
the coin or paper money. When the currency is worn out, the issuer buys it back at
face value, thereby balancing exactly the revenue received when it was put into
circulation, without any additional amount for the interest value of what the issuer
received.
15.2 The solvency constraint of the South African Reserve Bank only requires that the
present discounted value of its net non-monetary liabilities (separate from its
monetary liabilities accrued through seigniorage attempts) be zero or negative in
the long run. Its monetary liabilities are liabilities only in name, as they are
irredeemable: the holder of base money cannot insist at any time on the
redemption of a given amount of base money into anything else other than the
same amount of itself (base money); unless, of course, the holder of said base
money is another Reserve Bank/ Federal Reserve Bank reclaiming the value of its
original interest-free loan.
15.3 Currently over half the revenue of Zimbabwe is in seigniorage. Zimbabwe has
experienced hyperinflation, with the annual rate at about 24,000% in July 2008,
indicating that prices doubled every 46 days.
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15.4 Currently notes and coins represent 6 to 5 persent in the market place, the
remainder 94 to 95% are generated by banks, whom loan against their share
capital and reserves which the banks has invested in property, short term assets
and so on.
15.5 Until 1980 the South African Reserve Bank would issue directives as to the
amount of reserves relative to the duration of the loan, the volume of credit
advanced and the maximum growth rate at which credit extension could increase.
16. Within the framework of co-operation between the South African Reserve Bank andBanks, a bank can loan what it has put into circulation, without any additional amount for
the interest value of what the issuer received.
17. Thus, a loan from the South African Reserve bank by a bank is interest free, less the costof the manufacturing (print) of the note. This equates to a 95% interest free loan.
18. From the aforementioned two particular legal questions are raised:-
18.1 In the first instance, the bank, in this instance the Respondent was not the
institution that loaned, in first instance, the money to the Applicant. In other
words, the Respondent only obtained the required funding once the Applicant had
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completed and signed the necessary contracts. Therefore, the lack of the
Respondent disclosing to this fact in their contract failed the very basic
requirement in contract law, that is, it lacked capacity to act. It therefore can also
be said that there could have never been a true consensus between the parties. In
conjunction to the aforementioned, the Respondent did not have the necessary
capacity to act in the first instance, as it only became the holder of money after
the conclusion of an agreement between the Respondent and the Applicant. The
Respondents application therefore had to fail for the following reasons;-
18.1.1 The Respondent/ Applicant could never had consensus to concluded
the agreement, in term of the general requirements of Contract Law;
18.1.2 The Respondent lacked the capacity to act, because it only became the
holder of what was borrowed after the conclusion of the contract. It,
the Respondent, therefore was never in possession of what was
presented as being in their possession prior to the contract being
concluded, in other words, the transaction was subjected to them
obtaining the funds from another, the South African Reserve Bank.
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18.1.3 For the Respondent to have the appropriate and correct status, the
contract should have clearly stated that it is acting as intermediary,
subjected to the Respondent obtaining a loan from the South African
Reserve Bank. This fact is not disclosed in the Respondents contract.
18.1.4 In addition, the Respondent does not disclose this fact in its
advertisements.
18.1.5 The fact stated above remains intact, irrespective if the Respondent had
utilised their security to obtain the loan on behalf of the Applicant, as it
had undesirably deceived their truthful role, that is, acting as
intermediary. The Applicant reiterates, its irrespective if the
Respondent obtains what was required in due course, as the fact
remains that the Respondent acted as intermediary.
18.1.6 The Respondent in this regard will argue, as they have done before, that
the relationship between themselves and that of the South African
Reserve Bank is one conjured in terms of legislation, thus the
Respondent, like other banks, are exclusively and uniquely, authorised
to utilise this future of advancement of loans. This argument, with due
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respect, has nothing to do with the fact that the Respondent still acts as
intermediary, irrespective of their special relationship and/ or security.
18.1.7 It is the Respondent is required in law, including The National Credit
Act and Consumer Protection Act, of which the latter derives its
legislative inauguration from the South African Constitution, 1996, to
disclose all material facts to a consumer and to inform a consumer of all
material facts so that an informed decision may be formulated.
18.1.8 The requirements to disclose, which contention was in particular raised
in these proceedings forgoing this application, was pertinent and
important as the lack of disclosure raises questions as to the true intent
of the Respondent, its reasons and in retrospect its hidden reasons for
non-disclosure, as will be prevailed hereinafter.
18.2 When the Respondent obtained a loan from the South African Reserve Bank, it
did so against its own security at no cost and close to 5% or less interest. Further,
this loan was not executed with liquid money being borrowed, but rather by South
African Reserve Bank bonds, in close resemblance to promissory notes. This
equates no liquid money being passed from one to another, but rather a debit and
credit entry taking place in each partys accounting records. The latter entries are
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then followed through to the Applicants account created by and at the
Respondent.
18.2.1 This averment was placed before the Court, of first instance and its
appeal, and summarily dismissed by the Honourable Judges presiding
over this matter. Their reasoning being that, inter alia, society has
moved from traditional cash transactions to electronic payment systems
and that to retain traditional values holds no place in an ever changing
society. The Applicant makes no objection against these findings,
however, and more so, the Honourable Judges have displaced the
Applicants contention, that is; Due to the Respondents use of
electronic methods it has become so more efficient to debit and credit
accounts with nothing more than nothing; whereas when liquid
money is required to be withdrawn, the Respondent would simply
place such funds into the possession of the drawer from reserved funds.
In all other transactions it will simply pass a credit or debit as
required. This is achieved by the very same technology we have
become so accustomed to.
18.2.2 The argument will be raised, as before, that these presents have no fault
or prejudice to the Applicant. To the contrary, given the mathematic
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calculations utilised in this process, an example being that the total
exposure of Bank A is Bn1, it requires additional capital to extend and
uphold its business for the next year. Thus Bank A requires an
additional Bn1. For this, Bank A will borrow from the South African
Reserve Bank bonds or credit notes at close to 5% or less, enter this
credit into the account of client X. In other words, nothing other than an
entry onto the account of X. X is now required to effect payment, first
towards interest, cost then capital. If X pays Y, such credit and debit is
done to reflect the accounting transaction. When X makes payment
towards his account, the liquid money is received as close to 100%
profit (100% profit is recorded as transaction fees and administration
fees are recorded against the transaction).
18.2.3 From the aforementioned one can deduce that the Respondent is
profiteering on no more than accounting entries, proverbial, empty
boxes that are filled with liquid money from the Applicant.
18.2.4 In returning to the example forgoing, Bank X gathered only a paper
loan against its own security at no risk and no interest, whereupon it
will gain substantial profits, costs and fees, which in return will allow
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them to increase their investments with the South African Reserve
Bank, so it can for ever increase its profiteering.
18.2.5 These instances, inclusive of the averments in paragraph 15, supra,
places an unreasonable financial prejudice onto the Applicant, so much
so, that the Legislature has asymmetrically authorised the Banks, like
the Respondent, to print proverbial money at leisure to the expense and
factual financial prejudice of the Applicant.
18.2.6 Had the Applicant been informed in first instance of the role the
Respondent plays in procuring loans, e.g. its intermediary-ship, and the
fact that loans are based on a measure of profiteering, there could never
have been a meeting of minds in concluding the contract with the
Respondent.
18.2.7 No contract can stand where it is shown that the very nature of the
contract was to deceive, profiteer and goes against the moral fibres of
the people, thus the Respondents contract stands contested.
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[23]
18.2.7 Within these premises, the Respondents application for summary
judgment had to fail, as the Applicant had shown a defence, which in all
probable cause, would allow thorough investigation by the Courts
before, which would dispense the Applicants burden to show proper
cause why the matter should continue by way of trial.
18.3 Given the facts above, consideration must be given that the Respondents claim
would in effect be in-correct as its claim in liquid money has no basis, because the
fundamental aspect is that which was borrowed was not liquid money, but it was
no more than a promissory note, entered as a debit/ credit entry. To correct these
premises, the Respondent would need to correct their pleadings, so it correctly
reflects security granted or obtained on behalf of the Applicant, which will also
equate to an amendment to the contract of first instance and the issue of a
certificate of balance.
18.3.1 The fact that the Respondent claims liquid money (see agreement) and
lacks to abbreviate on the fact that it, the Respondent, does not say the
same about their borrowings being liquid money is clearly indicative
that the Respondent was pre-empting, had knowledge and intended to
deceived the Applicant from inception of the contract. In other words,
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why mention the payment to be made in liquid money in the first
instance, where the obvious would suffice mutatis mutandis.
18.3.2 It follows that the claim of the Respondent would be in contravention of
theIn Dup Rule, so much so, that the interest charged would in fact be
null and voidable as [a] the liquid money never received entry into the
books of the Respondent, and in the alternative [c] interest charged on
the capital is based on an illiquid transaction.
IN CONJUNCTION TO THE ABOVE (IN THE ALTERNATIVE):
SECURITISATION:
19. Securitization is the financial practice of pooling various types of contractual debt such asresidential mortgages, commercial mortgages, auto loans or credit card debt obligations
and selling said consolidated debt as bonds, pass-through securities, or collateralized
mortgage obligation [CMOs], to various investors. The principal and interest on the debt,
underlying the security, is paid back to the various investors regularly. Securities backed
by mortgage receivables are called mortgage-backed securities (MBS), while those
backed by other types of receivables are asset-backed securities (ABS).
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[25]
19.1 As stated supra, paragraph 13 hereof, it is not the business of the bank to engage
in or deal in securitization of its own contract. The Respondent is prohibited from
such activities.
19.2 The publication annexed as JJJ 4 hereto confirms this. Paragraph 1 of this
publication reads as follows: SA Home Loans (SAHL) is not a bank and does
not accept deposits from the public. As such, in order to be able to fund the home
loans which are given out to clients, SAHL (South African Home Loans) has set
up a securitisation funding platform. and at paragraph 3 The capital markets are
where long term funding (greater than one year in duration) can be obtained and
it is, as such, the place where many lenders, banks included, would obtain long
term funding for their longer term assets (such as home loans).
19.2.1 To achieve the aforementioned the process would in most instances be
one where a suitably large portfolio of assets is "pooled" and transferred
to a "special purpose vehicle" or "SPV" (the issuer), a tax-exempt
company or trust formed for the specific purpose of funding the assets.
Once the assets are transferred to the issuer, there is normally no
recourse to the originator. The issuer is "bankruptcy remote," meaning
that if the originator goes into bankruptcy, the assets of the issuer will
not be distributed to the creditors of the originator. In order to achieve
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this, the governing documents of the issuer restrict its activities to only
those necessary to complete the issuance of securities.
19.2.2 Accounting standards govern when such a transfer is a sale, a financing,
a partial sale, or a part-sale and part-financing. In a sale, the originator
is allowed to remove the transferred assets from its balance sheet: in a
financing, the assets are considered to remain the property of the
originator. Under South African accounting standards, the originator
achieves a sale by being at arm's length from the issuer, in which case
the issuer is classified as a "qualifying special purpose entity" or
"qSPE".
19.3 For a bank like the Respondent it will be required to bundle the security (a bond
registered over the title deed of the Applicant) with other agreements and assign
the rights and title over to the particular securitisation broker or company. See
annexure JJJ 5, JJJ 6, JJJ 7 and JJJ 8 hereto. Within these premises,
one will note that the Respondent (bank) loses it rights and title to the security;
therefore it cannot be the Applicant as purported in their proceeding before this
court as they would lacklocus standi.
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[27]
19.4 The originator (the Respondent) initially owns the assets engaged in the deal. This
is typically a company looking to raise capital, restructure debt or otherwise adjust
its finances. Under traditional corporate finance concepts, such a company would
have three options to raise new capital: a loan, bond issue, or issuance of stock.
However, stock offerings dilute the ownership and control of the company, while
loan or bond financing is often prohibitively expensive due to the credit rating of
the company and the associated rise in interest rates.
19.3.1 If for any reason the Respondent apportions that it has the proper locus
standi, it had in any event failed to do so properly in their surmising
proceedings;
19.3.2 Once again, the Respondent finds itself in a precarious position, as it
once again was not the original moneylender, but intermediary with
the added negative legal standing of lacking locus standi; in tallying-
19.3.2.1 The Respondent now also benefits from the transaction of
securitisation two folded: ~
19.3.2.1.1 The Respondent gains further loan capacity
as it has rid its debt and four folded its
exposure to entertain more loans to the
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[28]
public with the unknown participation of the
Applicant; and
19.3.2.1.2 Commissions or interest are earned by the
Respondent of securitisation transactions; in
other words, over and above earning in
receivables from the Applicant it now earns
income from securitisation as can be seen
from annexure JJJ 6 to JJJ 9 hereto.
Securitization makes it possible to record an
earnings bounce without any real addition to
the firm. When a securitization takes place,
there often is a "true sale" that takes place
between the Originator (the parent
company) and the SPE. This sale has to be
for the market value of the underlying assets
for the "true sale" to stick and thus this sale
is reflected on the parent company's balance
sheet, which will boost earnings for that
quarter by the amount of the sale. While not
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[29]
illegal in any respect, this does distort the
true earnings of the parent company.
20. The Applicant had signed a limitless power of attorney authorising the Respondent todispense with, inter alia, registration of a bond onto the title deed of the property, thus, the
deed will form part of security held by the Respondent against the loan. However, the
registration of the bond together with the power of attorney is utilised by the Respondent to
gain funding from processes mentioned above and below. The Respondent therefore does
not, and the power of attorney stipulates as much, require any further authority from the
Applicant in whatsoever dealing the Respondent contracts into. The result being that the
Applicant is in toto removed from any transaction the Respondent concludes with
securities given by the Applicant.
20.1 The Applicant contends that the power of attorney was given explicitly for theexclusive use to register a bond, and nothing more, therefore the use of the power
of attorney in any other formulations are without prior knowledge at the first
instance, without consent, authority and such use is in conflict with the National
Credit Act and law in general use, e.g. law of contract.
20.2 If such signature had been used, or in the alternative assigned to any other processof securitisation or in its third alternative to gain funds or loans relating to
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[30]
securitisation, or in its fourth alternative gain any benefit or in its fifth alternative
placed an obligation on the Applicant, the Respondent had done so without
explicit permission from the Applicant and the Respondent is in violation of the
fiduciary relationship as between the Applicant and Respondent (as banker) and in
terms of the Bank Act.
20.3 Had the Respondent gained from any securitisation, aforementioned, theApplicant is entitled to share in such profits, notwithstanding the fact that such
profits would effectively lessen the Applicants liability to the Respondent.
21. The process of securitization caused prejudice towards the Applicant as, unknown to the
Applicant, another becomes the holder of its security (bond) and therefore the risk arises
that such security can be called-up under any judicial process like liquidation or
administrative orders;
21.1 The opposite of the above, any income derived from securitisation is deliberatelywithheld from the Applicant, or will never be brought under the attention of the
Applicant as knowledge of such securitisation process has been withheld from the
Applicant by the Respondent, so much so, the Respondent is not prohibited from
making such entries into the accounting books of the Respondent.
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[31]
21.2 The process of securitisation deprives the Applicant of knowledge as to whom thetrue creditor is, its financial exposure which, inter alia, could include the
Respondent acting as intermediary and/ or collecting agent for a third party whom
could, once again, earn collection commission when acting as intermediary/
collecting agent.
21.3 Lastly, when the Respondent entertains processes like securitisation, why is itheld so secretively; the subject matter being protected most vigorously by the
Respondent? The only conclusion is that there is collusion between the parties
that can only equate to profiteering. If, which the Applicant contends its not
permitted in terms of how the Respondent deals therein, securitisation is allowed,
why is it not disclosed or public knowledge, particularly prior to any agreement
being concluded between the Applicant and the Respondent?
22. Thus application for summary judgment must fail and the Respondent must amend itsapplication proper. In this regard the Honourable Judge failed to realise that the defence so
offered by the Applicant is technically difficult, obstructed by generality, implied contract
law remedies and the bone of what is contended in defence is further frustrated by the
Respondents unwillingness to go beyond its contract of loan, holding same as a proverbial
shield from the seriousness of the allegations made by the Applicant.
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[32]
IN CONJUNCTION TO THE ABOVE (IN THE ALTERNATIVE):
SEIGNORAGE:
23. This subject matter co-exists with paragraphs 13 to 18, Business of the Bank, supra,discussed separately due to its fundamentals being difficult to comprehend and/ or
appreciate.
24. Seignorage can be defined as one of the following as it relates to these proceedings;-
24.1 Historically, if a person has one ounce of gold, trades it for a government-issued
gold certificate (providing for redemption in one ounce of gold), keeps that
certificate for a year, and then redeems it in gold, that person ends up with exactly
one ounce of gold again. No seigniorage occurs.
24.2 Instead of issuing gold certificates, a government converts gold into currency at
the market rate by printing paper notes. A person exchanges one ounce of gold for
its value in currency. They keep the currency for one year, and then exchange it
all for an amount of gold at the new market value. This second exchange may
yield more or less than one ounce of gold if the value of the currency relative to
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gold has changed during the interim. (Assuming that the value or direct
purchasing power of one ounce of gold remains constant through the year.)
24.2.1 If the value of the currency relative to gold has decreased, then the
person receives less than one ounce of gold, thus seigniorage occurred.
24.2.2 If the value of the currency relative to gold has increased, the redeemer
receives more than one ounce of gold thus seigniorage did not occur.
24.2.3 Seigniorage, therefore, is the positive return on issuing notes and coins,
or "carry" on money in circulation.
24.2.4 The opposite, "cost of carry", is not regarded as a form of seigniorage.
24.3 Ordinary seigniorage can be defined as an interest-free loan, for instance, of
gold, to the issuer (South African Reserve Bank) of the coin or paper money.
When the currency is worn out, the issuer buys it back at face value, thereby
balancing exactly the revenue received when it was put into circulation, without
any additional amount for the interest value of what the issuer received.
24.4 Historically, seigniorage was the profit resulting from producing coins. Silver and
gold were mixed with base metals to make durable coins. Thus the British
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[34]
"sterling" was 92.5% pure silver; the base metal added (and thus the pure silver
retained by the government mint) was (less costs) the profit, or the seigniorage.
24.5 Currently, under the rules governing monetary operations of major central banks
(including the central bank of the USA and in similarity the South African Reserve
Bank), seigniorage on bank notes is simply defined as the interest payments
received by central banks on the total amount of currency issued. This usually
takes the form of interest payments on treasury bonds purchased by central
banks, putting more Rands into circulation. However, if the currency is collected,
or is otherwise taken permanently out of circulation, the back end of the deal
never occurs (that is, the currency is never returned to the central bank). Thus the
issuer of the currency keeps the whole seigniorage profit, by not having to buy
worn out issued currency back at face value.
24.6 The solvency constraint of the South African Reserve Bank only requires that the
present discounted value of its net non-monetary liabilities (separate from its
monetary liabilities accrued through seigniorage attempts) be zero or negative in
the long run. Its monetary liabilities are liabilities only in name, as they are
irredeemable: the holder of base money cannot insist at any time on the
redemption of a given amount of base money into anything else other than the
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[35]
same amount of itself (base money); unless, of course, the holder of said base
money is another central bank reclaiming the value of its original interest-free
loan.
24.7 To illustrate the aforementioned points, in relation to modern day application of
seigniorage, would be to reference Slate Online comments on 29 th of July 2011,
regarding the 2011 United States of America debt ceiling crisis. The author
suggested that the United States of America Government mint a US$5 trillion
coin, deposited the said mint with the Federal Reserve and used to buy back debt
thus making funds available. The author, whom in effect suggested seigniorage
was not off-beat, as it later appeared that the United States of America caused
such a bail-out for its bankers, thus it created money out of nothing.
25. Seigniorage is a concept utilised throughout financial history over decades, the onlyindifference being that modern seigniorage does not have physical liquidity like gold as
the exchange principal; this has been replaced by axiomatic I owe you notes.
26. To further illustrate the points above and below, the Basil Reports imitating from theGlobal Regulator, USA, formulates standards on bank capital adequacy, stress testing and
market liquidity risk agreed upon by the members of the Basel Committee on Banking
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[36]
Supervision. Currently the Basil III report is the operative guideline internationally. These
reports have been excluded from this application due to its volumes being in extensive;
however copies of Basil II and III shall be made available at the hearing of this matter. A
report by Deloitte has been annexed hereto as JJJ 9 as further referencing material.
27. The Respondent having required a loan from the South African Reserve Bank in thehistorical sense of seigniorage, had occurred nothing more than the cost of the currency,
its return value to balance to books, thus the loan was zero rated in interest; in the
alternative the Respondent had acquired a loan based on bonds, zero rated in interest,
however there is no seigniorage to be earned. See paragraph 24.2.4 supra.
28. The Respondent, acting as nothing more than an intermediary with special legislativeauthority to conduct and conclude transactions of this nature, obtained a loan, free of
interest, and elected to charge X% of interest per annum, the interest to be paid first, then
the capital, had acted exuberantly, selfish, motivated by profiteering having absolute
disregard for human rights, law of general application, manipulative in a monopolised
environment, which include the Bank Act and South African Reserve Bank Act.
IN CONJUNCTION TO THE ABOVE (IN THE ALTERNATIVE):
FRACTIONAL RESERVE SYSTEM:
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[37]
29. By definition, Fractional Reserve System, forms part of banking where banks maintainreserves (of cash and coin or deposits at the central bank) that are only a fraction of the
customer's deposits. Funds deposited into a bank are mostly lent out, and a bank keeps only
a fraction (called the reserve ratio) of the quantity of deposits as reserves. Some of the
funds lent out are subsequently deposited with another bank, increasing deposits at that
second bank and allowing further lending. As most bank deposits are treated as money in
their own right, fractional reserve banking increases the money supply, and banks are said
to create money. Due to the prevalence of fractional reserve banking, the broad money
supply of most countries is a multiple larger than the amount of base money created by the
Reserve Bank. That multiple (called the money multiplier) is determined by the reserve
requirement or other financial ratio requirements imposed by financial regulators, and by
the excess reserves kept by commercial banks like the Respondent.
30. The South African Reserve Bank generally mandates reserve requirements that requirebanks to keep a minimum fraction of their demand deposits as cash reserves. This both
limits the amount of money creation that occurs in the commercial banking system, and
ensures that banks have enough ready cash to meet normal demand for withdrawals.
30.1 Problems can arise, however, when depositors seek withdrawal of a large
proportion of deposits at the same time; this can cause a bank run or, when
problems are extreme and widespread, a systemic crisis. To mitigate this risk, the
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governments of most countries (usually through their Reserve Bank, and in South
Africa, the South African Reserve Bank) regulate and oversee commercial banks,
provide deposit insurance and act as lender of last resort to commercial banks like
the Respondent.
30.2 Fractional-reserve banking is the most common form of banking and is practiced
in almost all countries, including South Africa. Although Islamic banking
prohibits the making of profit from interest on debt, a form of fractional-reserve
banking is still evident in most Islamic countries.
30.3 The nature of modern banking is such that the cash reserves at the bank available
to repay demand deposits need only be a fraction of the demand deposits owed to
depositors. In most legal systems, a demand deposit at a bank (e.g., a checking or
savings account) is considered a loan to the bank (instead of a bailment), see
Bank Act, repayable on demand that the bank can use to finance its investments in
loans and interest bearing securities. Banks make a profit based on the difference
between the interest they charge on the loans they make, and the interest they pay
to their depositors (aggregately called the net interest margin (NIM)). Since a
bank lends out most of the money deposited, keeping only a fraction of the total as
reserves, it necessarily has less money than the account balances of its depositors.
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[39]
30.4 The main reason customers deposit funds at a bank is to store savings in the form
of a demand claim on the bank. Depositors still have a claim to full repayment of
their funds on demand even though most of the funds have already been invested
by the bank in interest bearing loans and securities. Holders of demand deposits
can withdraw all of their deposits at any time. If all the depositors of a bank did so
at the same time a bank run would occur, and the bank would likely collapse. Due
to the practice of the South African Reserve Bank, this is a rare event today, as the
South African Reserve Bank usually guarantee the deposits at commercial banks,
and act as lender of last resort when there is a run on a bank.
30.5 As an example for a very simple idea of how the fractional reserve system can
work is as follows, if there is only one bank, for a Reserve Fraction of 10%, a
bank can turn R1, 000.00 deposit M0 of money, into R18, 997.00 of "M1"
money. Ignoring interest & fees, which makes banks even more profitable, this is
how a bank can copy 90% of "M0" money to make "M1" money, where in this
example the money loaned out is simply re-deposited in the bank and loaned out
again, and so on, that is how the R18, 997.00 "M1" money comes from the R1,
000.00 of "M0" money. Banks, like the Respondent do this by accumulating loans
and deposits (effectively multiplying) the "M0" supply to make a larger "M1"
supply. Banks can collect interest on the spread of the higher loan interest from
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[40]
the lower deposit interests. Return on Investment (ROI) for a bank is theoretically
infinite considering the bank is using none of its own money, if one excludes the
cost of setting up and maintaining the accounting system.
PREJUDICE CAUSED TO THE APPLICANT:
30.6 If a bank run occurs, it results in crises like that of the Northern Rock crisis of
2007 in the United Kingdom. Furthermore, the collapse of Washington Mutual
bank in September 2008, the largest bank failure in history, was preceded by a
"silent run" on the bank, where depositors removed vast sums of money from the
bank through electronic transfer.
30.7 In a normal economic environment, cash is steadily being introduced into the
economy by the South African Reserve Bank. Given the facts of financial crises
across the Globe, there seems to more and more concerns that the Fractural
Banking System will fail, causing Governments to bail out more and more
bankers at the expense of the public, despite the Respondent and alike profiteering
in billions.
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[41]
30.8 If creditors are afraid that the bank is running out of cash or is insolvent, they have
an incentive to redeem their deposits as soon as possible before other depositors
access the remaining cash reserves before they do, triggering a cascading crisis
that can result in a full-scale bank run. The aforementioned scenario has had its
reality when the 20Twenty Bank was placed in liquidation; its bailouts were
stupefied, leaving the public to fend for themselves, thus the victim.
30.9 Currently, policy papers and the state of Government spell inadequate funds to
maintain roads, municipal services and basic education, the Government therefore
does not sit in any position to cause a financial bailout should any one of the
events, supra, takes place.
IN CONJUNCTION TO THE ABOVE (IN THE ALTERNATIVE):
ARTIFICIAL MONEY CREATION:
31. Money creation, as pleaded by the Applicant in proceeding before this application has beenrejected and booted as an argument held by cults, ignorant and outburst of utter nonsense.
It would seem that history seems to be an untold story when these averments are made; as
such possibilities seem surreal in an open and democratic society, like South Africa,
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[42]
therefore some time will be spent on explaining how money creation happens at banks and
that of the Respondent.
31.1 The relending model begins when an initial R100 deposit of the South AfricanReserve Bank money is made into Bank A. Bank A takes 20 percent of it, or R20,
and sets it aside as reserves, and then loans out the remaining 80 percent, or R80.
31.2 At this point, the money supply actually totals R180, not R100, because the bankhas loaned out R80 of the South African Reserve Bank money, kept R20 of South
African Reserve Bank money in reserve (not part of the money supply), and
substituted a newly created R100 IOU (I owe you) claim for the depositor that acts
equivalently to and can be implicitly redeemed for South African Reserve Bank
money (the depositor can transfer it to another account, write a check on it,
demand his cash back, etc.). These claims by depositors on banks are termed
demand deposits or commercial bank money and are simply recorded in a bank's
accounts as a liability (specifically, an IOU to the depositor). From a depositor's
perspective, commercial bank money is equivalent to South African Reserve Bank
money it is impossible to tell the two forms of money apart unless a bank run
occurs (at which time everyone wants South African Reserve Bank money).
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[43]
31.3 At this point in the relending model, Bank A now only has R20 of South AfricanReserve Bank money on its books. The loan recipient is holding R80 in South
African Reserve Bank money, but he soon spends the R80. The receiver of that
R80 then deposits it into Bank B.
31.4 Bank B is now in the same situation as Bank A started with, except it has adeposit of R80 of South African Reserve Bank money instead of R100. Similar to
Bank A, Bank B sets aside 20 percent of that R80, or R16, as reserves and lends
out the remaining R64, increasing money supply by R64. As the process
continues, more commercial bank money is created.
31.4.1 To illustrate the above a chart representing the transactions above
follows: (as per loans between banks)
Bank Amount Deposited Lend Out Reserves
A 100 80 20
B 80 64 16
C 64 51.20 12.80
D 51.20 40.96 10.24
E 40.96 32.77 8.19
F 32.77 26.21 6.55
G 26.21 20.97 5.24
H 20.97 16.78 4.19
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I 16.78 13.42 3.36
J 13.42 10.74 2.68
K 10.74
Total 457.05 357.05 100
Total Reserves 89.26
31.5 Although no new money was physically created in addition to the initial R100
deposit, new commercial bank money is created through loans. The two boxes
marked in italics show the location of the original R100 deposit throughout the
entire process. The total reserves plus the last deposit (or last loan, whichever is
last) will always equal the original amount, which in this case is R100. As this
process continues, more commercial bank money is created. The amounts in each
step decrease towards a limit. If a graph is made showing the accumulation of
deposits, one can see that the graph is curved and approaches a limit. This limit is
the maximum amount of money that can be created with a given reserve rate.
When the reserve rate is 20%, as in the example above, the maximum amount of
total deposits that can be created is R500 and the maximum increase in the money
supply is R400.
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[45]
31.6 Considering the magnitude and scale money is created, one can simply not ignore
that the banks such as the Respondent, are directly the cause of increase and
decrease of loan rates. Fractional reserve banking allows the money supply to
expand or contract. Generally the expansion or contraction of the money supply is
dictated by the balance between the rate of new loans being created and the rate of
existing loans being repaid or defaulted on. The balance between these two rates
can be influenced to some degree by actions of the South African Reserve Bank.
32. Returning to the contention the Applicant has shown from inception of these cases, onecannot simply ignore the facts above and expect to be profiteered on and when called-upon
to make good an agreement which was designed to circumvent liability, disable defences,
condone activities that begs justification why a system of such gross infringement and
prejudice can exist in an open democratic society.
33. The Applicant persist, its not wanting any privilege or discount in these proceedings otherthan justification why the Respondent is allowed to charge exuberant fees and interest on
what in fact does not exist in tangibility format and why the Applicant must give way to its
property, a guarantee in terms of the Constitution, which should stand above the might of
the Respondent profiteering.
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[46]
34. The actions of the Respondent described supra amount to contravening of Section 1 read
with Section 78 of the Bank Act, which prescribes 1002 undesirable practice.
35. Forfeitures amounting to arbitrary deprivations of property should not occur where the
Respondent has more than doubled on its profits as would directly infringe upon the rights
to property in terms of the Constitution.
THE INFERENCE ARGUMENTS
FEDATORY:
36. The Respondent owes the Applicant a duty to be treated honestly, to be informed of allmaterial matter before and during the existence of the contract and even thereafter and
not to profit additionally from the Applicants transaction. When one person stands in
relation to another in a position of confidence involving a duty to protect the interests of
that other person, he or she is not allowed to make a secret profit at the other's expense,
or to place himself or herself in such a position that his or her interests conflict with his
or her duty. Such a claim may arise because of a breach of contract or in delict as the case
was inDaewoo Heavy Industries (SA) (Pty) Ltd v Banks [2004] 2 All SA 530 (C), 2004
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[47]
865 (4) SA 458 (C), Da Silva v CH Chemicals (Pty) Ltd [2009] 1 All SA 216 (SCA), 2008
(6) SA 866 620 (SCA).
37. To establish a breach of a fiduciary duty, the Applicant must allege facts from which theexistence of such a duty can be deduced. For instance, the Applicant can rely on the
relationship between principal and agent, of a guardian to a ward, director to a company
or an attorney to a client or in this instance, the Respondent to the Applicant.
38. It is not necessary to define the fiduciary duty and to succeed, one needs to make thenecessary allegations concerning the particular duties imposed by the duty, in other words,
the scope and ambit of the duties imposed on the Respondent in this case, in which the
duties are implied (duties that derive ex lege) and arise in the context of the contract that
defines the relationship between the parties.
39. Furthermore, the case ofSlip Knot Investments 777 (Pty) Limited v Project Law Prop (Pty)Limited and Others (36018/2009) [2011] ZAGPJHC 21 (1 April 2011) has particular
reference to illustrate the Courts approach to over-profiting. At paragraph 11 on page 6
the Learned Judge sites Innes J finding in Reuter v Yates, as follows: It comes to this - in
deciding whether the defence of usury has been sustained, and whether the lender has
taken such an undue advantage of the borrower, has so practised extortion and
oppression, that his conduct, being akin to fraud, disentitles him to relief, the Court will
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[48]
examine all the circumstances of the case. It will not only look at the scale of interest
which has been stipulated for, but will have regard to the ordinary rate prevalent in
similar transactions, to the security offered and the risk run, to the length of time for which
the loan was given, the amount lent, and the relative positions of the parties. Further, at
endnote 15 of page 9 of the Learned Judge, remarks Since time immemorial, our common
law has set its face against exploitation in the levying of interest. A most illuminating
discussion on this aspect can be found in a historical survey by Grov, Die
gemeenregtelike beheer van woeker in die Suis-Afrikaanse Reg, De Jure, 1989 (22), 233
and Die gemeenregtelike beheer van woeker in die Suid-Afrikaanse Reg (vervolg), De
Jure, 1990 (23),118.
40. A fiduciary relationship prevents an agent, in this instance the Respondent, from enteringinto any transaction that would cause the Applicants interests to clash with the
Respondents duty. For instance, an agent employed to buy cannot sell his or her own
property; an agent employed to sell cannot buy his or her own property. In addition the
agent cannot make any profit from his or her agency other than the agreed remuneration.
As the case was inRobinson v Randfontein Estates Gold Mining Co Ltd 1921 883 AD 168
180, Bellairs v Hodnetl1978 (1) SA 1109 (A) 1130F, Low v Shedden [2001] 2 All SA 884
171 (C) and Ganes v Telecorn Narnibia Ltd [2004] 2 All SA 609 (SCA), 2004 (3) SA 615
885 (SCA).
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[49]
41. Within these premises the Respondent was duty bound in terms of the fiduciaryrelationship that came into operation the moment the Applicant applied for a loan from the
Respondent, further to be confirmed by entering into a contract with the Respondent and
its on-going relationship is confirmed by the Applicant making payment to the
Respondent.
42. If follows that the Respondent has seriously breached the fiduciary duty by misleading theApplicant in the grounds so set-out supra and therefore its the right of the Applicant to
bring civil action against the Respondent, which it intends doing.
CONCLUSION:
43. The structures employed by the Respondent are at very least distrustful, designed forfailure as it has no tangibility or substance which can justify the exorbitant interest charged
against such undulations;
44. The Respondent acted with predefined, predetermined set of actions prior to concludingthe agreement with the Applicant because laws relating to the conduct of their industry
allows for such conduct of profiteering to take place;
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[50]
45. There exist no true competition among banks where one can take your business, as eachone of these so-called competitors are just another extension of banks whom hold the
exclusive mandate to exchange nothing for liquid demands;
46. The Applicant had not mandated the Respondent to act, as it did in these premises, whereits inception was that liquid money is borrowed against liquid repayments. There could
never exist consensus meeting of the minds between the parties given the facts aforesaid,
because what the Applicant had envision and what the Respondent versioned are two very
distinct and far apart things that one cannot connect the two minds to conclude consensus;
47. Policies and guidances designed to protect the system from manipulation has been
infringed upon, absolute disregarded to rights and obligation in terms of law, rules and
public policy has been replaced by profiteering regardless.
48. The Respondent cannot allot that it had the capacity to act, as it had no such means; TheRespondent had to use external manipulation processes, elaborated schemes and betray
trust to enable it to gain the capacity to act;
49. It is doubtful that the Respondent had acquired authority to act; that is that the Respondenthad acquired the rights and obligations prior to the loan agreement being brought into
existence, as the majority of the Respondents rights and obligations were only concluded
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[51]
once security, surety and creditworthiness was given, sold-off, load against or manipulated
from nothingness, then pretended to give physical value.
50. The Applicant contests that it has prospects of success in this appeal, if not in paragraphs 1to 12 supra, paragraphs 13 to 32 supra.
51. Furthermore, the Applicant interjects that the processes followed by the Respondent are inviolation of the Constitution as far as the Legislation, in particular The Bank Act, The
South African Reserve Bank Act and Policies concerning financial services rendered by
the Respondent, in so far the Bill of Rights, Section 25 are concerned.
__________________________DEPONENT
I hereby certify that the deponent declares that the deponent knows and understands the contents
of this affidavit and that it is to the best of the deponent's knowledge both true and correct. This
affidavit was signed and sworn to before me at Johannesburg on this 20th day of April 2006 and
that the Regulations contained in Government Notice R1258 of 21 July 1972, as amended have
been complied with.
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__________________________COMMISSIONER OF OATHS
Name & Rank : Address : Telephone No. :
DATED AT PRETORIA ON THIS THE . DAY OF APRIL 2012.
JJJ Bosman
Applicant
Suite 1
PostNet Esselen Street
Shop 29A, The Village
47 Esselen Street, Sunnyside
Pretoria
E-mail: [email protected]
TO: THE REGISTRAR OF THE ABOVE HONOURABLE COURT
PRETORIA
AND TO: FINDLAY & NIEMEYER INC
Attorneys for Respondent
1027schoeman street
Hatfield Pretoria
Docex 14, Pretoria
Tel.: 012 342 9164
Fax.: 012 342 9165
Ref.: Mr M Coetzee/mm/f3011
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Received a copy hereof on this the_____ day ofAPRIL2012