Supreme Electronic Engineering Solutions CC v A Shikongo & Partners Investment CC and Another (HC-MD-CIV-ACT-CON-2020/04795) [2024] NAHCMD 145 (2 April 2024)

REPUBLIC OF NAMIBIA

HIGH COURT OF NAMIBIA MAIN DIVISION, WINDHOEK

JUDGMENT

Case no: HC-MD-CIV-ACT-CON-2020/04795

In the matter between:

SUPREME ELECTRONIC ENGINEERING SOLUTIONS CC PLAINTIFF

and

A SHIKONGO & PARTNERS INVESTMENT CC FIRST DEFENDANT

SACKY AMUTENYA SECOND DEFENDANT

Neutral citation: Supreme Electronic Engineering Solutions CC v A Shikongo & Partners Investment CC (HC-MD-CIV-ACT-CON-2020/04795) [2024] NAHCMD 145 (02 April 2024)

Coram: UEITELE J

Heard: 22 March 2024

Delivered: 02 April 2024

Flynote: Practice — Rules of the High Court — Rule 108 — Execution — Sale in execution — Immovable property — Judgment creditor must first execute against the movables properties of a judgment debtor before he or she execute against the immovable property of a judgment debtor.

Summary: The plaintiff instituted action against the defendants. The matter was set down for trial and at the commencement of the trial, the defendants’ legal practitioner informed the court that an irreconcilable difference arose between him and the second defendant. He accordingly applied for leave to withdraw as counsel for the defendants. The court granted counsel leave to withdraw as legal practitioner for the defendants, vacated the trial dates and ordered that the defendants must pay the plaintiff’s wasted costs in respect of the vacated trial dates.

The wasted cost amounted to N$146 891.50 together with interests at the rate of 20% per annum calculated from the date of the allocatur. When the judgment debt remained unsatisfied for seven days, after the allocatur was issued, a writ of execution in respect of the defendants’ movable properties was issued. The deputy sheriff attended to the second defendant’s residence, attached and removed movable properties to be sold in execution. The movable properties of the second defendant that were attached and removed from his residence have to the date of this judgment not been sold in execution.

During September 2023, the plaintiff caused another writ of execution to be issued and executed by the deputy sheriff. During October 2023, the deputy sheriff retuned a nulla bona return, stating that no disposal movable property of the defendants could be found to satisfy the warrant of execution. Armed with the nulla bona return, the plaintiff approached this court seeking that the second defendant’s immovable property be declared executable. The second defendant opposes the rule 108 application on the basis that until the movable properties, which the deputy sheriff attached and removed from his residence, are sold in execution it cannot be stated that he does not have sufficient movable properties to satisfy the judgment debt.

Held that: when a court hears an application in terms of Rule 108(1)(b), the court must do two things. The court must first establish whether the property is the primary residence of the judgment debtor and second, whether the judgment debtor can offer alternative means by which he can pay the debt, other than by execution against the primary residence.

Held that: it is undoubtedly clear that a judgment creditor must first execute against the movables properties of a judgment debtor before he or she execute against the immovable property of the judgment debtor.

Held that: the allegations by the second defendant do not consist of bold or un-creditworthy denials, nor do they raise fictitious disputes of fact, or are palpably implausible, far-fetched and so clearly untenable. The allegations by the second defendant seriously cast doubt on the allegation by the plaintiff that the second defendant removed or disposed the movable assets after they were attached by the deputy sheriff.

Held further that: the response by the plaintiff’s legal practitioner is nothing but an unequivocal admission that the plaintiff caused the movable goods of the second defendant to be attached, removed and stored by the deputy sheriff.

Held further that: the plaintiff attaches to its papers only one return of service by the deputy sheriff, a nulla bona return. The deputy sheriff did not, as required under rule 104(7), file with the registrar any process with a return of what he or she has done in respect of the movable goods he has attached.

Held that: rule 67 is not for the mere asking. A party must make out a case for the court to resort to rule 67 and an instance where the court will resort to rule 67(2) would be one where an order akin to an absolution from the instance in a trial matter would have been warranted. This is not one such instance.

Held further that: rule 108 (1)(a) and the authorities of this court are quite clear in that execution against the immovable property of an execution debtor or of any other person can only be granted where there is a return of service from which it appears that the execution debtor or person has insufficient movable property to satisfy the judgment debt. Accordingly, the court is not so satisfied that the plaintiff has made out a case that the second defendant has insufficient movable assets to satisfy the judgment debts.

Held further that: the application is dismissed with costs.

ORDER

1. The application to declare the immovable property described as Erf No. 4342 (A Portion of Erf 138) Mondesa, Swakopmund, Republic of Namibia and held by deed of transfer No. T 3771/2019, specially executable is dismissed.

2. The plaintiff must pay the defendant’s costs of suit such costs to include the costs of one instructing and one instructed counsel.

3. The matter is finalised and removed from the roll.

JUDGMENT

UEITELE J:

Introduction

[1] This is yet another matter in which a judgment creditor (the applicant) seeks to have an immovable property belonging to a judgment debtor (the respondent) declared specially executable.

[2] In this matter the applicant or execution creditor or plaintiff is Supreme Electronic Engineering Solutions CC, a close corporation registered in terms of the close corporation laws of the Republic of Namibia. I will, in this judgment, for ease of reference refer to the applicant as it was in the main action namely as the plaintiff.

[3] There are two respondents or execution debtors or defendants cited in this matter. The first respondent is A Shikongo & Partners Investment CC, a close corporation registered in terms of the close corporation laws of the Republic of Namibia. The second respondent is Sacky Amutenya, the sole member of the first respondent. I will, in this judgment, for ease of reference refer to A Shikongo & Partners Investment CC as the first defendant and to Mr Amutenya as the second defendant.

Background facts

[4] As I indicated earlier in this judgment, the plaintiff is seeking an order declaring the second defendant’s immovable property, which is situated at Erf No. 4342 (A Portion of Erf 138) Mondesa and held by Deed of transfer No. T 3771/2019, specially executable. The bulk of the background facts leading the plaintiff to seek the order it is seeking are not in dispute and I will briefly summarise them in the next paragraphs.

[5] On 18 November 2020, the plaintiff sued the first and second defendants out this court for relief which is not material to this application. After the process of case management, the managing judge set the matter down for trial on the action floating roll for the week of 07 to 11 March 2022. On 07 March 2022, the defendants’ legal practitioner informed the court that an irreconcilable difference arose between him and the second defendant. He accordingly applied for leave to withdraw as counsel for the defendants.

[6] The court granted counsel leave to withdraw as legal practitioner for the defendants, vacated the trial dates and allowed the defendants to seek alternative legal representation. The court, however, ordered that the defendants must pay the plaintiff’s wasted costs in respect of the vacated trial dates. On 22 March 2022, the plaintiff presented its bill of costs for taxation, which was taxed and the Taxing Master issued an allocatur during April 2022. The allocatur was for the amount of N$146 891.50 together with interests at the rate of 20% per annum calculated from the date of the allocatur.

[7] When the judgment debt remained unsatisfied seven days after the allocatur was issued, the plaintiff, on 20 April 2022, caused a writ of execution in respect of the defendants’ movable properties to be issued. The writ of execution was dispatched to the deputy sheriff for execution. On 08 July 2022, the deputy sheriff sent to the plaintiff’s legal practitioner’s a return of service and an inventory list of the attached movable properties to be sold in execution. What is not in dispute is that the goods (the second defendant’s movable properties) that were attached by the deputy sheriff during April 2022 have to the date of this judgment not been sold in execution.

[8] On 05 April 2023, the plaintiff’s legal practitioner caused another/second writ of execution to be served on the second defendant. On 06 April 2023, the deputy sheriff furnished a return of service attaching a black Volkswagen Touran TSI wagon to be sold in execution. The second defendant alleged that the vehicle belonged to a third party (his wife) and paid an amount of N$90 000 for the release of the vehicle from attachment.

[9] During September 2023, the plaintiff caused another writ of execution (the third) to be issued and executed by the deputy sheriff. During October 2023, the deputy sheriff retuned a nulla bona return, stating that no disposal movable property of the defendants could be found to satisfy the warrant of execution. Armed with the nulla bona return, the plaintiff, during January 2024, approached this court seeking the second defendant’s immovable property to be declared executable. The second defendant opposes that application.

Basis on which the second defendant opposes the application

[10] The second defendant contents that the plaintiff is not entitled to the relief he is seeking for the mere reason that the application to declare the immovable property executable does not comply with the prescripts of rule 108(1)(a) of the rules of this court.

[11] The second defendant elaborates on his contention as follows. He deposed that on 6 July 2022 at around 09h35, the deputy sheriff, represented by Mr Rickert and Mr Hannes, contacted him and indicated that they wish to attend to his residence to access his house in order to ‘attach and remove’ the properties they attached. They had allegedly threatened that they will break the locks to the second defendant’s house if he does not get there on time.

[12] The second defendant deposes that he managed to get to his residence on time before the deputy sheriff, Mr Hannes and Mr Rickert, could forcefully open the door to his house at Elisenheim, Windhoek. Mr Rickert showed him the writ of execution and demanded satisfaction of the payment of the judgment debt from him. Mr Rickert proceeded to search for movable properties that can be attached and sold to pay the judgment debt. Thereafter, the deputy sheriff and Mr Rickert made an inventory of the goods that they attached. They did not remove the property so attached at that time.

[13] Later on the same day (that is on 06 July 2022) between 15h00 and 18h00, the representatives of the deputy sheriff who attended to the second defendant’s residence earlier came back to his residence and removed all the movable properties listed in the inventory of the attached goods. The second defendant further deposes that ever since the movable properties were removed, he has not received any feedback on when the sale would be held or whether the sale was already concluded. He continued and stated that he consistently asked the plaintiff’s legal practitioner of record on the progress of the sale in execution, with the view to get the amount realised from the sale, and to try and settle the remaining amount of the debt which remained unsettled.

[14] The second defendant further stated that despite his effort and communications, he has not received any satisfactory feedback from either the plaintiff’s legal practitioners of record or the deputy sheriff. The second defendant further contends that until the movable properties, which the deputy sheriff or his representatives removed from his residence, are sold in execution it cannot be stated that he does not have sufficient movable properties to satisfy the judgment debt.

The issue to be determined in this application

[15] The issue that I am called upon to determine in this matter is the question of whether or not the plaintiff is entitle to execute against the immovable property of the second defendant.

[16] Before I embark on the determination of that question, I will summarise the general approach to execution of judgments.

The general approach regarding execution of movable and immovable property

[17] In our jurisdiction, execution of judgment debts is governed by Part 11 of the rules of this court and in particular rules 104 (execution: general), 105 (execution: movables), 106 (execution: incorporeal property, liens and real rights), 107 (attachment of debt held by garnishee), 108 (conditions precedent to execution against immovable property and transfer of judgments), 109 (execution: immovable property) and rule 110 (procedure for sale of immovable property).

[18] Rule 104 requires that when a sheriff is directed or required to levy and raise a sum of money on the goods of a person (who I refer to as the judgment debtor) he or she must proceed to the dwelling or place of employment of such the judgment debtor and demand satisfaction of the writ. If the judgment debtor fails to satisfy the writ, the deputy sheriff must demand that so much movable and disposable property be pointed out as he may deem sufficient to satisfy the writ. If the judgment debtor fails to point out the movable and disposable property, the deputy sheriff must search for that property.¹

[19] Once the deputy sheriff has identified or found the movable property of the judgment debtor, he or she must immediately make an inventory of the movable properties and, unless the execution creditor has in writing directed otherwise, the deputy sheriff must, subject to exceptions set out in the rules², take that property into his or her custody.³

[20] In terms of rule 108(1), the registrar may not issue a writ of execution against the immovable property of an execution debtor or of any other person unless –

‘(a) a return has been made of any process which may have been issued against the movable property of the execution debtor from which it appears that that execution debtor or person has insufficient movable property to satisfy the writ; and

(b) the immovable property has, on application made to the court by the execution creditor, been, declared to be specially executable.’

[21] When a court hears an application in terms of Rule 108(1)(b), the court must do two things. The court must first establish whether the property is the primary residence of the judgment debtor, and second, whether the judgment debtor can offer alternative means by which he can pay the debt, other than by execution against the primary residence.

[22] From what I have stated earlier, it is undoubtedly clear that a judgment creditor must first execute against the movables properties of a judgment debtor before he or she execute against the immovable property of the judgment debtor. In the South African matter of Nkola v Argent Steel Group (Pty) Ltd t/a Phoenix Steel⁴ the Supreme Court of Appeal had to consider a situation where a judgment debtor, who had sufficient moveable property as well as immovable property, but refused to assist or frustrated the process of the sheriff when the sheriff wanted to execute against the movable property.

[23] The court in the Nkola matter held that when executing a judgment, a judgment debtor’s movable property must be attached first and sold to satisfy the judgment debt before the judgment creditor can proceed to execute against immovable property.⁵ The judgment debtor may only proceed to execute against the immovable property of a judgment creditor when the movable property is insufficient to fulfil the debt.

[24] The Supreme Court of Appeal further held that in terms of the common law, a judgment creditor can execute on immovable property where a judgment debtor has failed to point out movable property and make it available. The court, with approval, referred to Silva v Transcape Transport Consultants and Another⁶ where it was held that when a judgment debtor is behaving in a tricky manner and deliberately frustrates the judgment creditor’s efforts to obtain payment, execution should proceed against the judgment debtor’s immovable properties. It said:

‘… Generally the judgment debtor himself is asked to point out to the person making the execution the property which he wishes to be taken and sold off with a view to the securing of a judgment debt. If he refuses to do so or does so in a tricky manner or points out what is not enough, the court servant himself seizes at his discretion those things from which the money can most readily be made up. He does so up to the limit of the debt. Hence if a debtor should pay a good deal while the execution is pending fewer things would have to be sold off than those which had been originally seized.'

[25] Having set out the general approach to execution of judgment, I now proceed to consider whether the plaintiff has made out a case for the relief it is seeking.

Discussion

[26] It is incumbent upon an applicant for execution to set out such facts relevant to a particular case with due regard to the provisions of rule 108(1)(a) to enable the court to exercise its discretion properly.

[27] The plaintiff contends that after it issued a writ of execution in respect of the second defendant’s movable properties, on 20 April 2022, and dispatched it to the deputy sheriff for execution, the plaintiff, on 08 July 2022, received a return of service with an inventory list of the goods attached and to be sold in execution. The plaintiff further contends that before it could sell the attached items in execution, the second defendant disposed of or removed the items from his residence.

[28] The plaintiff deposes that, on 10 August 2023, it obtained default judgment against the second defendant under case number HC-MD-CIV-ACT-CON-2022/03430 for payment in the amount of N$30 000 including interest on the said amount calculated at the rate of 20% per annum from 21 September 2021. He continued that the second defendant has failed or neglected to pay the capital amount including interests which to the date of this application amounted to N$43 268.90.

[29] The plaintiff further deposes that, during September 2023, it caused a writ of execution to be executed by the deputy sheriff. On 09 October 2023, the deputy sheriff furnished the plaintiff’s legal practitioner with a nulla bona return to the effect that no disposal property could be found to satisfy the judgment debts. The plaintiff thus contends that, in light of the fact that the judgment debts remain unsatisfied and the second defendant has no realisable movable assets, it has no other option but to execute against the second defendant’s immovable property.

[30] The second defendant disputes the allegation that he has no realisable movable assets. I have earlier set out the basis on which the second defendant disputes the plaintiff’s allegations. What is thus clear is that there is a dispute with regard to the events surrounding the removal of the second defendant’s movable assets.

[31] Through the Plascon-Evans⁷ rule, it is now well established that where disputes of fact arise in motion proceedings, final relief can only be granted if the facts averred in the applicant's affidavits, which have been admitted by the respondent, together with the facts alleged by the respondent, justify an order, unless the respondent's version consists of bold or un-creditworthy denials, raises fictitious disputes of fact, is palpably implausible, far-fetched and so clearly untenable that the court would be justified in rejecting the respondent's allegations on the papers.⁸

[32] Applying the above principle to the facts of this case, I find that the allegations by the second defendant do not consist of bold or un-creditworthy denials, nor do they raise fictitious disputes of fact, or are palpably implausible, far-fetched and so clearly untenable. The allegations by the second defendant seriously cast doubt on the allegation by the plaintiff that the second defendant removed or disposed the movable assets after they were attached by the deputy sheriff. I say so for the following reasons:

(a) The second defendant states that on 06 July 2022 at around 09h35, the deputy sheriff contacted him and indicated that they wish to attend to his residence to access his house in order to ‘attach and remove’ the properties. They met at his residence and the representatives of the deputy sheriff made an inventory of the movable assets found at his residence. They did not remove the goods at that point, citing the need to get insurance or a paper from their office, as reason. He continued and depose that later that day, the representatives of the deputy sheriff, who earlier attended to his residence, removed all the movable properties listed in the inventory. He annexed telephonic communication between him and Mr Rickert to demonstrate that the deputy sheriff’s representatives were at his residence on 06 July 2022. He also annexed a series of communication between him and the deputy sheriff and the plaintiff’s legal practitioner in which he communicates and convey the fact that the deputy sheriff removed movable assets from his residence. In all these communications, the deputy sheriff and the plaintiff’s legal practitioners did not dispute the fact that they removed the movable assets from the second defendant’s residence.

(b) From the correspondences attached to the second defendant’s affidavit it emerges that, on 15 November 2022, the second defendant addressed a letter to the plaintiff’s legal practitioner enquiring when they will finalise the matter of the wasted cost. The plaintiff’s legal practitioner of record responded to that letter on the same date stating that:

‘… the items attached are not sufficient to cover the amount owed, which amount continues to accumulate interest and the storage fees (which you are liable for) keep increasing which in turn lessens the amount that will be paid to us after the sale in execution.’

[33] This response by the plaintiff’s legal practitioner is nothing but an unequivocal admission that the plaintiff caused the movable goods of the second defendant to be attached, removed and stored by the deputy sheriff.

[34] The plaintiff attaches to its papers only one return of service by the deputy sheriff, a nulla bona return. The deputy sheriff did not, as required under rule 104 (7), file with the registrar any process with a return of what he or she has done in respect of the movable goods he has attached.

[35] Having also found that the version put up by the second defendant raises a real and genuine dispute of facts as regards the movable assets of the second defendant, which were attached and removed from the second defendant’s residence, I find that, on the principles enunciated in Plascon Evans, the plaintiff is not entitled to the relief it is seeking. I can therefore not grant the order sought by the plaintiff.

[36] Counsel for the plaintiff has urged me to, instead of dismissing plaintiff’s application, grant it an opportunity to, as contemplated under rule 67(2), supplement its papers. My reading of the matter of Minister of Agriculture, Water and Land Reform v Job Shipululo Amupanda⁹ is that resort to rule 67 is not had for the mere asking. A party must make out a case for the court to resort to rule 67 and an instance where the court will resort to rule 67(2) would be one where an order akin to an absolution from the instance in a trial matter would have been warranted. This is not one such instance.

[37] Rule 108 (1)(a) and the authorities of this court are quite clear in that execution against the immovable property of an execution debtor or of any other person can only be granted where there is a return of service from which it appears that the execution debtor or person has insufficient movable property to satisfy the judgment debt. Accordingly, I am not so satisfied that the plaintiff has made out a case that the second defendant has insufficient movable assets to satisfy the judgment debts. I thus refuse the application.

[38] As it pertains to costs, I have not been pointed to reasons why the general principles relating to costs must not apply and I see no reason why the court must deviate from the general principle.

[39] In the result, I make the following order:

1. The application to declare the immovable property described as Erf No. 4342 (A Portion of Erf 138) Mondesa, Swakopmund, Republic of Namibia and held by Deed of transfer No. T 3771/2019, specially executable is dismissed.

2. The plaintiff must pay the defendant’s costs of suit such costs to include the costs of one instructing and one instructed counsel.

3. The matter is finalised and removed from the roll.

______________

S F I UEIETELE

Judge

APPEARANCES

PLAINTIFF: M. Tjitere (assisted by T Martin)

of Dr Weder, Kauta & Hoveka Inc.,

Windhoek

SECOND DEFENDANT: L Ambunda-Nashilundo

Instructed by Ausiku Attorneys,

Windhoek