Pretorius N.O and Another v Thaba Chweu Local Municipality and Another (5502/2023) [2025] ZAMPMBHC 107 (20 October 2025)

Case Note

Pretorius N.O. and Loots N.O. v Thaba Chweu Local Municipality and Registrar of Deeds, Mpumalanga, Case No 5502/2023, High Court of South Africa, Mpumalanga Division, Mbombela, 20 October 2025

Reportability

This judgment was marked “REPORTABLE” by the court, indicating that it establishes or clarifies principles of law that transcend the narrow dispute between the parties. It grapples squarely with the still-unsettled question whether the doctrine of estoppel can ever operate against a trust where trustees have failed to act jointly, a matter left open by the Supreme Court of Appeal in both Land and Agricultural Development Bank of South Africa v Parker and Others and Nieuwoudt and Another NNO v Vrystaat Mielies (Edms) Bpk.

By interrogating the interaction between section 2(1) and section 28(2) of the Alienation of Land Act 68 of 1981, the court also offers a considered exposition on how statutory presumptions of validity are limited when a trust’s internal capacity requirements have been breached. The judgment therefore provides useful guidance to conveyancers, municipalities, financial institutions and litigators who routinely transact with, or litigate on behalf of, trusts.

Finally, the ruling contributes to the growing body of jurisprudence insisting on strict compliance with trust deeds and insisting upon joint action by trustees if a trust estate is to be bound. The decision is thus of interest not only to other judges but to all practitioners involved in property transfers and trust administration.

Cases Cited

Land and Agricultural Development Bank of South Africa v Parker and Others 2005 (2) SA 77 (SCA); Nieuwoudt and Another NNO v Vrystaat Mielies (Edms) Bpk 2004 (3) SA 486 (SCA); Shepstone & Wylie Attorneys v De Witt NO and Others [2023] JOL 59149 (SCA); Thorpe and Others v Trittenwein and Another 2007 (2) SA 172 (SCA); Philmatt (Pty) Ltd v Mosselbank Developments CC 1996 (2) SA 15 (A); Room Hire Co (Pty) Ltd v Jeppe Street Mansions (Pty) Ltd 1949 (3) SA 1155 (T); Truth Verification Testing Centre v PSE Truth Detection CC and Others 1998 (2) SA 689 (W); Nedbank Ltd v Mhlari NO and Others 2022 (6) SA 438 (GJ).

Legislation Cited

Alienation of Land Act 68 of 1981, sections 2(1) and 28(2).

Rules of Court Cited

Uniform Rule 35(12) of the High Court Rules.

HEADNOTE

Summary

The applicants, the present trustees of the Luanza Swanepoel Familie Trust, sought a declaration that a 2011 deed of sale and the consequent 2012 transfers of two erven from the respondent municipality to the trust were void ab initio because only one of the two then-trustees had authorised the transaction. The municipality resisted the application, invoking the statutory presumption of validity created by section 28(2) of the Alienation of Land Act and contending that the trust was estopped from denying the authority of its erstwhile trustee.

The court reaffirmed that, absent an express contrary provision in the trust deed, trustees must act jointly; a single trustee cannot unilaterally bind the trust estate vis-à-vis outsiders. Applying the doctrine developed in Parker, Nieuwoudt and Shepstone & Wylie, the court held that the resolution and sale agreement signed only by Ms Luanza Swanepoel were a nullity.

Because the deed of sale was void for want of authority, section 28(2) could not revive it, and the municipality’s plea of estoppel failed as a matter of principle: the beneficiaries’ interests could not be prejudiced by the municipality’s reliance on ostensible authority. The transfers were accordingly set aside and the purchase price ordered to be repaid, although rates and taxes already levied and paid were not refundable.

Key Issues

The judgment addresses, first, whether the requirement of joint trustee action is a capacity-creating prerequisite that renders a contract void when breached. Secondly, it considers the scope of section 28(2) of the Alienation of Land Act in validating non-compliant alienations. Thirdly, it explores whether estoppel can operate against a trust whose own trustee acted ultra vires.

Held

The court declared both the deed of sale and the transfers void from inception because the trust deed required a majority decision (which, with only two trustees, meant unanimity) and this never occurred. Section 28(2) does not sanitise a transaction that was fundamentally beyond the capacity of the trust, and estoppel cannot override the protective policy embedded in trust law. The registrar of deeds must cancel the transfers, the municipality must cooperate in restoring title, and it must repay the purchase price, while each party bears its own costs.

THE FACTS

The Luanza Swanepoel Familie Trust owned no immovable property until 2011, when the first respondent, Thaba Chweu Local Municipality, purportedly sold two adjoining erven in Lydenburg Extension 73 to the trust for R1 203 700. At that time the trust had two trustees, Ms Luanza Swanepoel and her husband, Mr Jacobus Cornelius Swanepoel. Only Ms Swanepoel signed the trustee resolution and the deed of sale.

Transfer was effected in January 2012 and the trust began paying municipal rates and taxes. Years later, in 2021, the Master issued new letters of authority naming the applicants, Mr Pretorius and Ms Loots, as the sole trustees. When municipal accounts arrived, the new trustees investigated and discovered that neither Mr Jacobus Swanepoel nor any beneficiary had known of the purchase. They obtained copies of the deeds of transfer and the underlying sale documentation.

Believing the transaction void for want of joint trustee consent, the applicants approached the High Court for declaratory and ancillary relief. The municipality opposed, asserting that payment and transfer had occurred, that the Alienation of Land Act rendered the sale valid, and that the trust’s prolonged silence created an estoppel against disputing Ms Swanepoel’s ostensible authority.

THE ISSUES

The principal legal question was whether the sale and transfers were null because the two trustees had not acted jointly, as required by the trust deed and the common-law rule articulated in Parker.

A related issue was whether section 28(2) of the Alienation of Land Act validates an otherwise void disposition once full performance and registration have taken place.

Finally, the court had to decide whether the municipality could invoke estoppel—grounded in the trust’s apparent acquiescence and long-term payments—to preclude the trustees from denying Ms Swanepoel’s authority.

ANALYSIS

In three carefully reasoned stages, Managa AJ first examined the contents of the trust deed. Clause 20 required that “alle besluite van die trustees… kragtens meerderheidsbesluit” be taken; with only two trustees in office that translated into a need for both to participate. Neither the deed nor any subsequent resolution empowered a single trustee to act alone.

The court then traced the jurisprudence from Land Bank v Parker through Nieuwoudt to the recent Shepstone & Wylie. These authorities confirm that the rule of joint action is not a matter of internal management, but a capacity-defining condition: if the requisite number of trustees does not participate, the trust is incapable of acting and any purported act is void. The municipality’s reliance on section 28(2) was misplaced; that subsection merely cures non-compliance with the formal requirement that alienations be in writing and signed, but it cannot breathe life into an act that was ultra vires the trust from the outset.

Turning to estoppel, the court acknowledged that both Parker and Nieuwoudt had expressly left the issue open. After analysing the sui generis nature of a trust, the protective policy underpinning trust law and the potential prejudice to beneficiaries, the court concluded that estoppel cannot override the incapacity created by failure of joint trustee action. The contrary view adopted in Nedbank Ltd v Mhlari NO and Others was respectfully rejected. The municipality’s asserted factual disputes about payment of the purchase price were labelled far-fetched; employing a robust, common-sense approach, the court held that no genuine dispute of fact existed warranting a referral to oral evidence.

REMEDY

The deed of sale of 3 August 2011 was declared void ab initio. The transfers effected under Deeds of Transfer Nos 743/2012 and 744/2012 were set aside, and the Registrar of Deeds was ordered to cancel the registrations and restore the properties to the municipality’s name once corrective documents were lodged.

The municipality must sign all requisite documentation within thirty days of request and must repay the full purchase price of R1 203 700 to the trust. Because rates and taxes reflect the trust’s period of beneficial use, repayment of those amounts was refused. Each side was ordered to bear its own costs in recognition that responsibility for the defective transaction was shared between the municipality and the former trustee.

LEGAL PRINCIPLES

First, where a trust deed requires joint action or majority resolutions, that requirement is a capacity pre-condition. Any contract concluded in breach of it is void and unenforceable, irrespective of subsequent performance or registration.

Secondly, section 28(2) of the Alienation of Land Act validates only formal non-compliance contemplated in section 2(1); it does not rescue dispositions tainted by a want of authority or capacity.

Thirdly, the doctrine of estoppel cannot be employed against a trust to countermand the protective rule that trustees must act jointly. The beneficiaries’ interests, the sui generis nature of a trust and the public policy goal of preventing improper depletion of trust assets outweigh any reliance interest of a third-party transactor who failed to verify the trustees’ authority.