Written by Isabella Black
There may be an instance where a claim was incorrectly calculated and, as such, the court in which the claim was originally brought no longer has jurisdiction. For example, a Plaintiff may have a delictual claim that was initially R180 000 but following a further audit, the claim was re-calculated to be R470 000. The effect thereof may be that the Plaintiff can no longer sue in the applicable District Magistrate’s Court (DMC). The plaintiff may therefore elect to sue in the Regional Magistrate’s Court (RMC), despite its claim exceeding the monetary jurisdiction of same, since suing in the RMC is more cost-effective than suing in the High Court (HC). However, the Defendant is likely to fail to consent thereto and instruct the Plaintiff to either continue with its initial claim or issue fresh summons.
The legal issue to consider herein is whether, considering the above, the Plaintiff’s matter may be transferred from the DMC to the RMC.
TRANSFER OF THE MATTER
According to section 35(1) of the Magistrates’ Courts Act (MCA), the court in which an action or proceeding has been instituted may transfer that action or proceeding to any other court, provided that the parties consent thereto or a party applies for the respective referral. In the latter instance, it must be additionally apparent that the forthcoming trial may result in undue expense or inconvenience for such party.
The provision does not specify the court to which an action or proceeding must be transferred, but refers to ‘any other court.’ ‘Any other court’ [my emphasis] has been interpreted to include the DMC, RMC and HC.
However, whether a matter can be transferred from a DMC to a RMC, specifically, is subject to a debate — one led by competing schools of thought. The first school of thought states that section 35(1) of the MCA applies both horizontally (meaning a matter can be transferred from a DMC to another DMC or from a RMC to another RMC) and vertically (meaning a matter can be transferred from a DMC to a RMC and vice versa). The second school of thought, alternatively, suggests that section 35(1) of the MCA only applies horizontally.
Botha v Singh, a seminal case on this issue, followed the first school of thought — verifying it as the correct approach to section 35(1) of the MCA. The Court held that the matter in question could be transferred from the DMC to the RMC, irrespective of whether or not the RMC had original jurisdiction. Further, in their commentary on the MCA, Jones and Buckle ratified the Court’s judgement. What this makes clear is that the Plaintiff’s matter in question may be transferred to the RMC. Though, to secure transfer, further requirements must be satisfied.
As per section 35(1) of the MCA, the matter needs to be an ‘action or proceeding.’ The matter at hand constitutes an action as it is a delictual claim for damages (patrimonial loss). In following, since the Defendant will not consent to the transfer, the remaining option is for the Plaintiff to apply to the RMC for the transfer by way of a notice of motion. The application will be in terms of section 55 of the Magistrates’ Court’s Rules (MCR). As a further matter of procedure, the Plaintiff will have to give notice of their application to the Defendant. However, the RMC must have current jurisdiction over the matter to order for the removal.
Typically, the RMC cannot hear matters exceeding R400 000 — including the Plaintiff’s increased claim of R470 000. However, in terms of section 38(1) of the MCA, the Plaintiff may reduce its claim to R400 000 by explicitly abandoning a portion of it (namely R70 000). This will give the RMC monetary jurisdiction over the Plaintiff’s claim. I mention only ‘abandonment’ as an exception to the general rule as ‘consent’ and ‘deduction of an admitted debt’ are not applicable. Notably, if the matter comes to fall within the jurisdiction of the RMC, the Plaintiff will have to convince said court that it will incur undue expense or inconvenience, should the matter not be removed from the DMC — only then will the RMC consider effecting the transfer.
It is clear from the Defendant’s probable ultimatum (either the Plaintiff continues with the claim for R180 000 or issues fresh summons) that the Defendant will not consent to the DMC hearing a claim for R470 000, in terms of section 45(1) of the MCA. Further, it suggests that the Plaintiff will not have the leeway to reduce its claim to R200 000 in an effort to compromise and keep the claim in the DMC.
Therefore, the plaintiff must either persist with its initial claim or attempt to have same heard in the DMC. However, if the Plaintiff persists with their initial claim, they will forfeit damages. This may inconvenience the Plaintiff as the decrease in their net profit cannot be salvaged. Alternatively, should the Plaintiff elect to continue with a claim for R470 000 (though in the DMC), the Defendant will raise a special plea of jurisdiction as the DMC is limited to hearing matters under R200 000. This will bring the matter to an end and compel the Plaintiff to issue new summons in RMC – and should the matter be prescribed, come the formation of a new case, the Plaintiff will be inconvenienced as their chance of recovering any damages is eliminated. Moreover, withdrawal of the initial claim and tendering of costs will cause the Plaintiff undue expense — same will have to pay costs (lose money) despite no litigation.
It is evident that the Plaintiff may suffer undue expense and inconvenience, should their matter not be transferred to the RMC. However, the Court cannot arbitrarily exercise their discretion to transfer the matter, it must balance the interests of both parties and that of their own. Therefore, if after careful consideration, the Court is satisfied that transferring the matter is preferable, the matter can be removed from the DMC and subsequently heard in the RMC.
The above suggests that the Plaintiff’s matter may be transferred to the RMC from the DMC provided that the aforementioned requirements are met.
This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice. Errors and omissions excepted (E&OE).