THE SUPREME COURT OF APPEAL
REPUBLIC OF SOUTH AFRICA

JUDGMENT

Case no:  85/06
REPORTABLE
In the matter between:

YAGAMBARAM MOODLEY
APPELLANT

and

NEDCOR BANK LTD
RESPONDENT

Before:  Harms ADP, Heher, Cachalia JJA, Snyders, Theron AJJA

Heard:  16 March 2007

Delivered:  27 March 2007

Summary:
Jurisdiction - In an action upon a debt secured by a mortgage over
immovable property, the fact that the property is situated in the
territory over which a high court exercises jurisdiction constitutes a
jurisdictional connecting factor which confers jurisdiction on the court.

Neutral citation:  This judgment may be referred to as Moodley v Nedcor [2007]
SCA 27 (RSA)

CACHALIA JA
[1] In an action upon a debt secured by a mortgage over immovable
property the plaintiff is entitled not only to judgment for the amount of
the debt but also to an order declaring the mortgaged property executable
where it is situated within the court’s jurisdiction. If the immovable
property sought to be declared executable is situated within the
jurisdiction of a court other than where the cause of action for the money
claim arose the question arises whether that court has concurrent
jurisdiction over the matter. The question presents itself in this matter
against the following background.

[2] On 30 July 1996 the appellant entered into a loan agreement in
Johannesburg in terms of which the respondent, a commercial bank,
agreed to lend and advance to the appellant the sum of R180 000 upon
security of a mortgage bond registered against an immovable property
situated in the Durban area (‘the property’) within the Province of
Kwazulu-Natal.

[3] On 10 August 2000 the respondent (as plaintiff) instituted
proceedings against the appellant (as defendant) in the Pretoria High
Court for the recovery of the sum of R191 720,38 being the capital
amount which it alleged was then due and payable in terms of the
agreement. As is the practice in matters of this nature, the respondent also
sought an order declaring the property executable. On 12 September 2000
the respondent obtained judgment against the appellant and a warrant of
execution was thereafter issued against the property. The appellant then
brought an application to stay the sale in execution. The dispute was
settled on 8 November 2002 and the settlement agreement made an order
of court. This agreement also became a subject of dispute and the

litigation recommenced. This time the appellant applied successfully for
the order of 12 September 2000 to be rescinded.

[4] Following the rescission of the order the appellant filed a plea and
counterclaim on 2 February 2004. In his special plea, he alleged that the
Pretoria High Court lacked jurisdiction over the matter because the
property was situated within the Province of Kwazulu-Natal, and also
because his chosen domicilium citandi et executandi was there. The
special plea was clearly bad because the Pretoria High Court obviously
had jurisdiction over the matter on the basis that the cause of action arose
there.1 Inexplicably however, on 31 May 2004, the respondent withdrew
its action and paid the appellant’s wasted costs.

[5] On 15 June 2004 the respondent instituted fresh proceedings
against the appellant in the Durban High Court based on the same cause
of action. This time the amount claimed was R365 291,06, more than
double the amount of the original loan, the increase having resulted from
further interest that had accumulated on the loan. Once again the
respondent sought an order that the property be declared executable. The
appellant instructed the same attorney who had represented him in the
Pretoria High Court to defend this action. A plea was filed and the matter
set down for hearing in the Durban High Court. However, three days
before the trial was to commence, the appellant instructed another firm of
attorneys to represent him. This necessitated a postponement of the
hearing and on 2 September 2004 the newly instructed attorneys filed an
amended plea and three special pleas on his behalf. The special pleas

1 See s 19(1)(a) of the Supreme Court Act 59 of 1959 referred to below at para 8. Section 6(2) of the
Act confers concurrent jurisdiction on the Transvaal Provincial Division (TPD), also referred to as the
Pretoria High Court, in the areas of jurisdiction of the Witwatersrand (WLD), also referred to as the
Johannesburg High Court.

related to a plea that the court lacked jurisdiction to entertain the action; a
plea that the same dispute was pending before the Pretoria High Court by
virtue of the appellant not having withdrawn his counterclaim against the
respondent in that court; and a plea (in the nature of an exception rather
than a special plea) that the respondent’s particulars of claim lacked
averments to sustain its cause of action.

[6] The matter was argued before Jappie J on 8 November 2004 and on
2 February 2005 he dismissed each of the special pleas. On 29 August
2005 the judge heard the appellant’s application for leave to appeal
against his judgment and on 7 October 2005 he refused the application in
respect of the three special pleas. This court however granted leave on the
first special plea only ie, whether the Durban High Court had jurisdiction
to entertain the action.

[7] There are two issues in this appeal. The first, as mentioned in the
opening paragraph, is whether the Pretoria High Court has exclusive
jurisdiction over the matter by virtue of the cause of action having arisen
there, as the appellant contends it does, or whether, as the respondent
asserts, the Durban High Court has concurrent jurisdiction on the basis
that the property sought to be declared executable is situated within its
area of jurisdiction. The second arises only if the first is decided in the
appellant’s favour. This relates to whether in raising a special plea of lack
of jurisdiction initially in the Pretoria High Court and his failure
thereafter to object to the Durban High Court’s jurisdiction before the
pleadings had closed amounted to a waiver of his right to do so.

[8] I turn to deal with the first question. The authority of a high court
to decide any matter is derived from s 169 of the Constitution.2 The
Supreme Court Act 59 of 1959 regulates its jurisdiction.3 Section 19(1)(a)
of the Act confers on a high court jurisdiction ‘over all persons residing
or being in and in relation to all causes arising . . . within its area of
jurisdiction’. The phrase ‘causes arising,’ with which we are concerned
for present purposes, is sometimes mistakenly understood to mean
‘causes of action’. The phrase has been interpreted to refer to ‘legal
proceedings duly arising’ that is to say, proceedings in which the court
has jurisdiction under the common law.4 And while it is well established
that a court has jurisdiction over a matter where the cause of action arises
within its territorially demarcated area, the jurisdiction of a court is
determined with reference not only to the cause of action but also to all
connecting factors (rationes jurisdictionis) which give rise to jurisdiction
at common law.5 What has to be determined in this matter is whether the
location of the hypothecated property in Durban, within the territorial
jurisdiction of the Durban High Court, constitutes a jurisdictional
connecting factor giving rise to concurrent jurisdiction of the Durban
High Court.

[9] It has long been considered a sufficient basis for a court to exercise
jurisdiction over a matter if the nature of the relief claimed involves

2 Section 169 provides:  ‘A High Court may decide:
(a)
any constitutional matter except a matter that –

(i)
only the Constitutional Court may decide; or
(ii)
is assigned by an Act of Parliament to another court of a status similar to a High
Court; and
(b)
any other matter not assigned to another court by an Act of Parliament.’
3 Jurisdiction here means the power vested in a court by law to adjudicate upon, determine and dispose
of a matter (Ewing McDonald & Co Ltd v M & M Products Co 1991 (1) SA 252 (A) at 256G).
4Bisonboard Ltd v K Braun Woodworking Machinery (Pty) Ltd 1991 (1) SA 482 (A) at 486D; Ewing
McDonald (above) at 257F-G.
5Cordiant Trading CC v Daimler Chrysler Financial Services (Pty) Ltd 2005 (6) SA 205 (SCA) at
211D-E.

immovable property situated within its area of jurisdiction, even where
the court has no power over the defendant or because the cause of action
does not arise in the area. This is because, as Price AJA observed in Sonia
(Pty) Ltd v Wheeler6:

‘The Court of the area in which the property is situate can certainly control the
transfer of, or any interference with, the property through the Registrar of Deeds of
that area, and by other means.’

This approach is based on the principle of effectiveness – the power of
the court, not only to grant the relief claimed, but also to effectively
enforce it directly within its area of jurisdiction.7 It was on this basis that
the court below assumed jurisdiction in the present matter.

[10] Many years ago, in Palm v Simpson8 it was held that even though
the defendant was not resident within the area over which the court
exercised jurisdiction and no property of his had been attached to found
jurisdiction for an action claiming from him the contract price of land he
had purchased, the fact that the land was situated in that area constituted a
sufficient basis for the court to assume jurisdiction over a claim for
rescission of the contract of sale. That decision was approved by this
court in Sonia v Wheeler, referred to above, on grounds of ‘principle,
convenience and common sense’.9 In so approving Price AJA observed
that:
‘Palm’s case recognises what is a patent fact that the Court of the situs is the best-
equipped Court to deal with matters relating to land situated within its territorial
jurisdiction.’

6 1958 (1) SA 555 (A) at 562A-B.
7 Estate Agents Board v Lek 1979 (3) SA 1048 (A) at 1063H.
8 (1848) 3 M 565.
9 1958 (1) SA 555 (A) at 562C-D.

[11] In Sonia v Wheeler the property in question was situated in East
London, within the area of the Eastern Districts Local Division (EDLD);
the contract for the sale of the property had been entered into in the
Orange Free State and the purchase price was payable in the Transvaal
where the defendant was resident. The plaintiff sought an order in the
EDLD
cancelling
the
contract
on
the
ground
of
fraudulent
misrepresentation and also for a refund of the purchase price. This was a
money claim, as in the instant case. The defendant was not susceptible to
the court’s jurisdiction on any of the usual grounds of jurisdiction for a
claim of this nature. Despite this, this court upheld the finding of the
lower court that the plaintiff was entitled to institute the action in the
EDLD solely on the basis that the property was situated there. It was
however contended by the defendant that even if the EDLD had
jurisdiction to order the cancellation of the contract, its jurisdiction did
not extend to the money claims for the refund of the purchase price. It
was argued in other words that if the money claim stood alone and there
was no claim for cancellation, the court would not have jurisdiction. In
rejecting this contention Price AJA said the following:

‘Assuming this to be so, assuming that the Eastern Districts Court could not entertain
a claim for a refund of the purchase price if that claim stood alone, it nevertheless
seems to me that every consideration of convenience and common sense indicates that
where such a money claim is as closely associated with a claim for cancellation of the
contract, as in this case, and is a consequential claim, following on the cancellation,
the same Court which has jurisdiction to decree cancellation should have jurisdiction
to hear the money claim for a refund of the purchase price, and to order costs.’10

10 1958 (1) SA 555 (A) at 562F-H.

[12] In relation to cases involving the transfer of immovable property it
is also a sufficient basis for jurisdiction if the property is situated within
the area over which a high court exercises jurisdiction. It is therefore not
necessary for a high court to have power over the defendant, or for the
cause of action to have arisen there for a court to entertain a claim for the
transfer of immovable property situated within the division.11 Such
jurisdiction is however not exclusive.12

[13] Thus, as the cases in the preceding paragraphs demonstrate,
provincial divisions have exercised jurisdiction in matters involving the
rescission or cancellation of an agreement,13 or the transfer of immovable
property where the property is situated within their area of jurisdiction,
even where none of the other traditional jurisdictional factors were
present. Their rationale for so doing is that they exercise effective control
over the property, that there is a close association between the property in
question and the cause of action and also on grounds of ‘convenience and
common sense’.14 And as was said in Cordiant Trading CC v Daimler
Chrysler Financial Services (Pty) Ltd,15 the main objective for the
assumption of jurisdiction in such cases is to avoid a proliferation of
proceedings.
[14] Recently in Geyser v Nedbank Ltd: In re Nedbank Ltd v Geyser,16
which appears to be the only reported case dealing with the issue we are
concerned with (whether a high court is competent to exercise jurisdiction
over a matter on the basis only that the hypothecated property in question

11 See David Pistorius Pollak on Jurisdiction 2 ed p 91.
12 Ward v Burgess & another 1976 (3) SA 104 (TK) at 107B-C; Hugo v Wessels 1987 (3) SA 837 (A)
at 857C-F.
13 On the distinction between rescission and cancellation, see RH Christie The Law of Contract In
South Africa 5 ed p 539.
14 See Sonia v Wheeler 1958 (1) SA 555 (A) at 562F-H.
15 2005 (6) SA 205 (SCA) at 211D-H.
16 2006 (5) SA 355 (W).

is situated within its area of jurisdiction) Van Oosten J found that it was.
He reasoned that:

‘. . . the property, quite apart from its executability, has another relevance for purposes
of founding jurisdiction. It undoubtedly played an integral if not vital part in the loan
transaction which . . . constituted the basis for the bank’s cause of action. It was
obviously on the strength of the security of a first mortgage bond that the loan was
granted to the applicant . . . It is accordingly my finding that the situs of the
hypothecated property constitutes a jurisdictional connecting factor giving rise to the
jurisdiction of this court.’17

I respectfully agree with and adopt his reasoning. It is apparent that there
is a close association not only between the hypothecated property and the
nature of the proceedings ie, for payment of money arising out of loan
agreement, but also between the nature of the consequential relief, for the
hypothecated property to be declared executable, and the cause of
action.18 The decision by the court below to assume jurisdiction over this
matter is therefore consistent with the approach taken in the cases referred
to above.

[15] There is another reason why I think it was competent for the court
below to have exercised jurisdiction over this matter. The facts show that
the matter commenced in the Pretoria High Court where the appellant
objected to the jurisdiction of that court. Appellant concedes that the
objection was ill-founded. It was however a consequence of this objection
that the respondent thereafter instituted proceedings in the court below
and only shortly before the trial was to commence, and pleadings had
closed, that the respondent again objected to its jurisdiction. Apart from

17 See Geyser v Nedbank 2006 (5) SA 355 (W) at para 11.
18 See Estate Agents Board v Lek 1979 (3) SA 1048 (A) at 1063F-G.

the fact that the appellant has an insurmountable hurdle to overcome
before he can escape the inference that by his conduct he had acquiesced
in the court’s jurisdiction,19 I think that every consideration of
convenience and common sense required the court below to assume
jurisdiction over the matter. This conclusion makes it unnecessary to deal
with the issue of the waiver any further.

[16] It follows that the appeal must fail. The following order is made:

The appeal is dismissed with costs.

______________
A CACHALIA
JUDGE OF APPEAL

CONCUR:
HARMS ADP
HEHER JA
SNYDERS AJA
THERON AJA

19 Purser v Sales; Purser & Another v Sales and Another 2001 (3) SA 445 (SCA) paras 15-18.
THE SUPREME COURT OF APPEAL
REPUBLIC OF SOUTH AFRICA

MEDIA SUMMARY – JUDGMENT DELIVERED IN THE SUPREME COURT OF APPEAL

From: The Registrar, Supreme Court of Appeal

Date:

Status: Immediate

Please note that the media summary is intended for the benefit of the media and does not form part
of the judgment of the Supreme Court of Appeal.

Y. MOODLEY

V

NEDCOR BANK LTD

The Supreme Court of Appeal today dismissed with costs an appeal by Yagambaram Moodley
against a decision of the Durban High Court, dismissing his special plea that it (Durban High Court)
lacked jurisdiction to entertain Nedcor Bank’s action, claiming from him an amount of R365 291,06
and seeking an order that his property situated in La Merci, Durban be declared executable. The
bank instituted the action after Mr Moodley had defaulted in making his payments in terms of a
loan agreement.

The issues on appeal were whether the Pretoria High Court had exclusive jurisdiction over the
matter by virtue of the cause of action having arisen there, or whether the Durban High Court had
concurrent jurisdiction on the basis that the property sought to be declared executable was situated
within its area of jurisdiction. What the Supreme Court of Appeal was required to determine in this
matter was whether the location of the hypothecated property in Durban, within the territorial
jurisdiction of the Durban High Court, constituted a jurisdictional connecting factor giving rise to
concurrent jurisdiction of the Durban High Court.

In its conclusion, and in upholding the decision of the Durban High Court of assuming jurisdiction
over this matter, the Supreme Court of Appeal concluded that it was apparent that there was a close
association not only between the hypothecated property and the nature of the proceedings i.e., for
payment of money arising out of loan agreement, but also between the nature of the consequential
relief, for the hypothecated property to be declared executable, and the cause of action. The Court
went further and concluded that every consideration of convenience and common sense required the
court below to assume jurisdiction over the matter.