Deon Smith and Others v Sasfin Bank Ltd and Another

Sasfin Bank Ltd obtained two default judgments from the registrar of the Gauteng Division of the High Court against Deon Smith, Ellen Louise Smith, and Nadelei CC for amounts owing under a Master Agreement of Hire (rental agreement) originally concluded between Nadelei CC and Technofin (Pty) Ltd and later ceded to Sasfin. Mr and Mrs Smith had bound themselves as sureties and co-principal debtors. The applicants failed to enter an appearance to defend after service of summons and only applied for rescission approximately nine months after the default judgments were granted. They alleged they were not in wilful default and contended that the rental agreement was a simulated transaction intended to be a refinancing arrangement. The High Court dismissed the rescission application. Leave to appeal was refused, as was a petition to the Supreme Court of Appeal. The applicants then sought reconsideration under s 17(2)(f) of the Superior Courts Act.

The reconsideration application in terms of section 17(2)(f) of the Superior Courts Act was struck from the roll with costs.

The case clarifies the stringent threshold for reconsideration applications under section 17(2)(f) of the Superior Courts Act following its amendment, reaffirming that it is reserved for truly exceptional circumstances. It reinforces established principles governing rescission of default judgments, particularly the need for a reasonable explanation for default and a bona fide defence with prospects of success.