Gangat v Akoon (A 5044/19) [2021] ZAGPJHC 431 (21 December 2021)

Procedure - rescission - appeal of refusal to rescind default judgment - appropriateness of Plascon-Evans rule in rescission applications - legal principles on rescission restated.
A question posed in this matter is what test is to be applied where disputes of fact arise in a rescission application, and what outcome does it yield? The Plascon-Evans test is not the appropriate test in an application for rescission of judgment. The Plascon-Evans test applies to applications in which final relief is sought. Having regard to the requirements of Uniform Rule 31 (2)(b) which place the onus on the party applying for rescission to satisfy the requirements set out therein, the Plascon-Evans rule cannot apply as a party applying for rescission is not seeking final relief but merely seeks an order setting aside a default judgment so that he can be allowed to defend the action.
An assessment of the authorities shows that if the application involves a rescission of an order which should not have been granted, an applicant for a rescission under the common law need only make out a prima facie case. The effect of the order is interim only, and not final, and therefore factual disputes are ordinarily not a bar to success. If on the other hand the order was correctly made, but is to be set aside (permanently) because of, for instance, a composition with creditors, the order of setting aside is expected to have final effect and factual disputes would then become an obstacle to the applicant.
On rescissions: The requirements for rescission of a default judgment are twofold. First, the applicant must furnish a reasonable and satisfactory explanation for its default. Second, it must show that on the merits it has a bona fide defence which prima facie carries some prospect of success. Proof of these requirements is taken as showing that there is sufficient cause for an order to be rescinded. A failure to meet one of them may result in refusal of the request to rescind. However, it is not sufficient if only one of these two requirements is met; for obvious reasons a party showing no prospect of success on the merits will fail in an application for rescission of a default judgment against him, no matter how reasonable and convincing the explanation of his default.
However, the circumstance may be that reasonable or even good prospects of success on the merits would satisfy only one of the essential requirements for rescission of a default judgment. It may be that in certain circumstances, when the question of the sufficiency or otherwise of a
defendant's explanation for his being in default is finely balanced, the circumstance that his proposed defence carries reasonable or good prospects of success on the merits might tip the scale in his favour in the application for rescission. But this is not to say that the stronger the prospects of success the more indulgently will the Court regard the explanation of the default