The appellant and respondent were engaged in settlement negotiations. The respondent had served and filed a notice to oppose but held back filing its answering affidavit pending settlement discussions. A day before the hearing, the appellant's attorneys advised respondent's attorneys they were awaiting their client's instructions and assured them not to worry as it 'would be sorted out'. The appellant's attorneys did not revert to the respondent. On 2 August 2016, when the matter came before Phatudi J, the settlement discussions were not disclosed to the court, the court refused a postponement, and granted default judgment against the respondent. The respondent's subsequent application for rescission before Muller J was dismissed with costs on the erroneous basis that the judgment was not a default judgment. On appeal, the Full Court set aside Muller J's order and gave the respondent an opportunity to file its answering affidavit. The appellant appealed to the Supreme Court of Appeal.
The appeal was dismissed with costs.
The grant of an application for rescission of judgment is not appealable as it is an interlocutory order. An order is not appealable if it: (a) is not final in effect and is open to alteration by the court below; (b) is not definitive of the rights of the parties; and (c) does not dispose of a substantial portion of the relief claimed. Where material facts such as ongoing settlement negotiations are not disclosed to a court, a judgment obtained in those circumstances is erroneously granted and rescission is justified.
The Court expressed reservations that had counsel for the appellant been properly appraised of the settlement negotiations, as an officer of the court, he would not have proceeded on an unopposed basis to obtain default judgment. The Court deprecated the failure by attorneys to furnish counsel with proper instructions. The Court also noted that courts should not decide issues of academic interest only, referencing section 16(2)(a)(i) which provides that appeals may be dismissed where the decision sought will have no practical effect or result.
This case reaffirms the important principle in South African civil procedure that orders granting rescission of judgment are interlocutory in nature and generally not appealable. It clarifies the application of the Zweni test for appealability. The case also emphasizes the professional obligations of attorneys to properly instruct counsel and to make full disclosure to the court, particularly regarding material facts such as ongoing settlement negotiations. It demonstrates that failure to disclose such material facts can render a judgment erroneously granted, justifying rescission.