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[2020] ZAWCHC 20
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Maremmana Home Owners' Association v Melnic Wine Solutions CC and Others (16839/2018) [2020] ZAWCHC 20 (11 March 2020)

Republic
of South Africa
IN
THE HIGH COURT OF SOUTH AFRICA
(WESTERN
CAPE DIVISION, CAPE TOWN)
Case
No. 16839/2018
Before:
The Hon. Mr Justice Binns-Ward
Date
of hearing:  3 March 2020
Date
of judgment: 11 March 2020
In
the matter between:
MAREMMANA
HOME OWNERS’
ASSOCIATION
Applicant
and
MELNIC
WINE SOLUTIONS
CC
First
Respondent
STRATOVEST
117 (PTY)
LTD
Second
Respondent
THE
REGISTRAR OF DEEDS, CAPE
TOWN
Third
Respondent
JUDGMENT
BINNS-WARD
J
[1]
The applicant is a homeowners’
association.  It was constituted as a body corporate with the
object of promoting, advancing
and protecting the communal interests
of the owners of property in a housing development known as Maremmana
at Bot River in the
Western Cape.  It was established in
fulfilment of a condition imposed by the Theewaterskloof Municipality
for the subdivision,
at the instance of Stratovest 117 (Pty) Ltd, of
Portion 5 of Farm No. 781 in the Division of Caledon for the purpose
of proceeding
with the housing development.  The applicant is
the registered owner of Portion 56 of Farm No. 781.  It will be
convenient
for the purposes of this judgment to refer to it as ‘the
MHOA’.
[2]
Stratovest 117 (Pty) Ltd (hereinafter
referred to simply as ‘Stratovest’) was the developer of
the Maremmana housing
development.  It is the second respondent
in these proceedings.  It is the registered owner of Portion 57
of Farm No.
781.
[3]
In terms of a deed of sale dated
17 December 2009 Stratovest sold the Remainder of Portion 4 of
Farm No. 781 (hereinafter referred
to simply as ‘Portion 4’)
to Roderic Hall and Taryn Laura Hall.  The deed recorded that
the property thus sold
was ‘
currently
in extent 48,8561 (forty eight comma eight five six one) hectares but
… will, on subdivision in accordance with
Annexure 1 attached
hereto, be reduced by the deduction of not more than 7,57 (seven
comma five seven) hectares (Portion A on Annexure
1) result in a
Remainder of approximately 41,2861 (forty one comma two eight six
one) hectares
’.
The
land involved is ‘
agricultural
land
’ as defined in s 1 of
the Subdivision of Agricultural Land Act 70 of 1970, and therefore,
by virtue of s 3 of that
Act, may legally be subdivided only
with the written consent of the Minister of Agriculture.  At the
time of sale of Portion
4 to the Halls, the required ministerial
consent for the contemplated subdivision had not been obtained.
Planning permission
for the contemplated subdivision would also have
to be obtained from the local authority.  For that purpose
application would
have to be made in terms of s 24 of the Land
Use Planning Ordinance 15 of 1985 (Western Cape) that was still in
force at that
time.
[4]
The subdivision contemplated in the
aforementioned definition of the
res
vendita
was dealt with in clause 17 of
the deed of sale, which provided as follows:
TRANSFER
OF PORTION “A” ON ANNEXURE 1 HERETO
17.1
The parties agree that the Seller shall be responsible for obtaining
the requisite approvals in respect of the sub-division
of the land
described as Portion “A” on the Sketch Plan, marked
annexure 1 hereto, (approximately 7,57 hectares in
extent) from the
Remainder of Portion 4. Upon receipt of the said approvals, the
Purchaser or his successors in title shall be
bound to transfer the
said Portion “A” to the MHOA, no consideration whatsoever
being payable by the MHOA to the Purchaser
in respect of such
transfer.
17.2
The costs of such transfer shall be borne by the MHOA.
The
copy of the deed of sale that is attached to the founding papers does
not have annexed to it the ‘Annexure 1’ referred
to in
the contract, but that is of no consequence.
[5]
Portion 4 was duly transferred to Mr and
Mrs Hall pursuant to the deed of the sale.  Some years later
they sold the property
to Melnic Wine Solutions CC, which is the
first respondent in the current proceedings.  The first
respondent is currently
the registered owner of Portion 4.
The subdivision contemplated in terms of the deed of sale between
Stratovest and
the Halls had not yet been effected at the time that
Portion 4 was sold and thereafter transferred to the first
respondent.
[6]
Clause 6 of the sale agreement between the
Halls and the first respondent addressed the unfinished business of
the subdivision and
consolidation of Portion A by providing as
follows:
6.
SUBDIVISION OF PORTION A
6.1
The parties agree that the previous owner of the property, Stratovest
… is responsible for obtaining the requisite approvals
in
respect of the sub-division of the land described as Portion “A”
on the Sketch Plan, marked Annexure B hereto, (approximately

7,57 hectares in extent) from the Remainder of portion 4.
6.2
The Purchaser undertakes to co-operate fully with Stratovest …
to effect such sub-division and undertakes to sign all
such documents
and give all such consents as may be required to effect such
sub-division.
6.3
Upon receipt of the said approvals, the Purchaser or his successors
in title shall be bound to transfer the said Portion “A”

to the Merammana Home Owners’ Association [i.e. the applicant],
no consideration whatsoever being payable by the Merammana
Home
Owners’ Association.
6.4
The costs of such transfer shall be borne by the Merammana Home
Owners’ Association.
[7]
It is evident from the context described
thus far that clause 6 of the agreement between the Halls and the
first respondent was
predicated on the obligation undertaken in terms
of clause 17.1 of the agreement in terms of which the Halls had
obtained
registered title over the whole of Portion 4, but subject to
its contemplated subdivision.  Clause 6 imposed on the first
respondent the obligation that the Halls had undertaken in terms of
the first agreement, and which that agreement had contemplated
would
also be imposed on any of the Halls’ successors who might take
title from them before the contemplated subdivision
was effected.
The relationship between clause 6 of the second agreement and clause
17 of the first contract is confirmed
by the role reserved in terms
of clause 6.1 of the second agreement to Stratovest, which was not a
party to the second agreement,
to obtain the requisite approvals for
the subdivision.  In the absence of any evidence of a contrary
intention by the Halls,
it may be inferred, I think, that when they
sold Portion 4 to the first respondent they would not have undertaken
to pass any greater
rights in the ownership of the property than they
had purchased from Stratovest, nor would they have intended to burden
the purchaser’s
ability to deal with the property beyond the
extent to which they had been burdened in respect of Portion A when
they bought Portion
4.
[8]
Both Portions 56 and 57 of the Farm No. 781
- owned by the applicant and the second respondent, respectively –
share
immediate borders with Portion 4 of Farm No. 781 and,
more especially, with that part of it described as ‘Portion A’

in the aforementioned deeds of sale.  Prior to the sale of
Portion 4 to the Halls, Stratovest had effected certain improvements

on Portion A.  The improvements consisted of a club house
and certain facilities related to the operation of a polo club
on the
land.  The cost of these improvements had apparently been
financed by what is referred to in the papers as ‘
the
Stratovest loan
’.
Stratovest was liable for the redemption of the loan.  It is
common ground between the applicant and the second
respondent that at
the time of the sale to the Halls it had been contemplated that the
club facilities would be available to the
members of the applicant
homeowners’ association, and that it was towards facilitating
the realisation of that object that
Mr Peter Stuart, who was,
and remains, the sole member and director of Stratovest, caused the
provisions of clause 17 to be
included in the deed of sale between
the company and the Halls.
[9]
In these proceedings, Stratovest,
represented by Stuart, alleges that it was intended that the
contemplated transfer of Portion
A to the applicant would occur after
agreement had been reached between the company and the MHOA on the
sum that would be paid
by the latter to the former in consideration
of the improvements that had been effected to the property and also
on the terms of
a lease between the MHOA and the second respondent,
alternatively Stuart, in terms of which Stratovest, or Stuart, would
be enabled
to continue to operate the polo club on the property after
the MHOA had become the owner.  The question was discussed at a

meeting of the trustees of the MHOA held on 29 September 2009, just
over two months before the conclusion of the deed of sale between

Stratovest and the Halls.  Mr Stuart had been at the meeting in
his then dual capacity as the representative of Stratovest
and as a
trustee of the MHOA.  The minutes of the meeting, which were
attached to the second respondent’s answering
affidavit, and
the correctness or authenticity of which are not disputed, record the
pertinent particulars as follows:
5.3
Club membership and open space
Mr
Stuart explained that the clubhouse is built on the Remainder portion
4, with 8ha of land surrounding it. It is not possible
to register a
lease in perpetuity as the lease law stipulates that the term must be
less than 10 years (9,9 years) and a servitude
is only allowed on an
area not exceeding 250 m
2
. The important issue is that the
control of the clubhouse ideally should be handed over to the owners
of all the surrounding land
to protect the facility in perpetuity.
Therefore he had approached Mr Tertius Maree's office to assist him
in finding the best
solution as below.
Mr
Stuart proposed that this 8ha of land and the clubhouse be
consolidated into Portion 56 belonging to the Maremmana Homeowners’

Association and be governed by inclusion of clauses in the
constitution which would specify that cost and management would be
the responsibility of members.
Mr
Stuart proposed this conditional on the following:
·
That the Club members would, through
members fees, pay off the building cost of the clubhouse (ie a
Stratovest loan) and contribute
to the running cost of the club. An
annual membership of approximately R5000 would be applied depending
on membership uptake; 50%
of which would be put toward the
maintenance and running of the clubhouse, and 50% toward repaying the
Stratovest loan over a 5-10
year period. Additional funds needed
could be raised through fund raising events.
·
The land surrounding the clubhouse would be
leased to Mr Stuart and his appointed successors in perpetuity. A
clause in the contract
and the constitution would be that the land be
leased to Mr Stuart at R1 per annum in order to establish and run a
polo club. Mr
Stuart would be responsible for the costs of
maintaining the land and he would be prepared to include title deed
restrictions that
would limit any future land use to agricultural or
recreational activities in line with the original concept of a quiet
country
lifestyle. This would have the effect of safeguarding the
value the clubhouse and surrounding land.
·
The clubhouse must be run as a professional
business and would allow for opportunities to rent the facility as a
venue for functions.
Decision:
The
members agreed with the proposal and advised Mr Stuart to begin the
process of subdivision and consolidation on the above conditions.
Action:
P. Stuart
It
is common ground that the ‘
8ha of land
’ referred
to in the minutes related to what was subsequently defined as
‘Portion A’ in the respective deeds of
sale to which the
Halls and, subsequently, the first respondent, subscribed as
purchasers.
[10]
In the answering affidavit to which he
deposed on behalf of the second respondent, Mr Stuart averred
that ‘
paragraph
(sic)
17.1 of the Halls’ Deed of
Sale
was included (a) on the
strength of the assurances finished by the Applicant at the meeting
dated 29 September 2009, (b) in order
to protect the Applicant in the
event of it not being able to fulfill all of the pre-conditions
referred to hereinabove and as
recorded in the minute of the 29
September 2009 meeting (as per Annexure C hereto), and (c) in
order to protect the Second
Respondent's entitlement to compensation
from the applicant in the event of these preconditions indeed being
fulfilled (notably,
paragraph 17.1 only exempted the applicant from
having to pay a consideration to the Halls, as the new owners of
portion A - it
did not excuse them from their obligations vis-a-vis
the Second Respondent)
’
.  He
proceeded ‘[t]
he Second Respondent
was protected by the fact that only it (and not the purchaser, nor
the Applicant) would be authorized to obtain
the relevant approvals
for subdivision and consolidation (but only in the event of the
applicant meeting its end of the bargain)
’.
[11]
It was minuted that the matters apparently
agreed upon at the 29 September trustees’ meeting were to
be confirmed at
the forthcoming annual general meeting of the
applicant association.  It is not evident on the papers what
transpired at that
meeting, but, in the event, no agreements of the
nature contemplated at the trustees’ meeting were ever
concluded.  Indeed,
it appears from the narrative of subsequent
interactions between the MHOA and Stratovest that as recently as 2014
a majority of
the home-owning members of the MHOA indicated that they
had no interest in the acquisition of the land, and certainly not on
the
basis that the MHOA would incur an attendant liability to
compensate Stratovest for the cost of the improvements on it.
[12]
According
to Mr Stuart, it was in the context of the failure of the idea
that the MHOA would enter into an arrangement whereby
it would fund
the redemption of the Stratovest loan and bind itself to enter into a
long-term lease with the second respondent,
that he subsequently
obtained the requisite approvals to enable the subdivision of Portion
4 and the consolidation of the resultant
Portion “A”,
not
with Portion 56, as contemplated in the deed of sale with the Halls,
but instead with Portion 57, which, as mentioned, is Stratovest’s

property.  The approvals obtained for the subdivision of Portion
A from Portion 4 were granted by relevant authorities, subject
to the
condition that Portion A, upon its separation from Portion 4,
had to be consolidated with Portion 57.  (Having
regard to the
provisions of s 4(1)(a)(i) of the Subdivision of Agricultural
Land Act
[1]
and the definition
of ‘
owner
’
in s 4(1)(b),
[2]
Stuart
would have needed the authority of the Halls to have been able to
validly obtain the approval required in terms of that
statute.)
[13]
When the Halls sold Portion 4 to the first
respondent by deed of sale dated 2 September 2016, they
apprehended that the provisions
of clause 17 of the contract in terms
of which they had acquired that property obliged them to include in
their contract with the
first respondent the obligations stipulated
in clause 6, quoted above.  They were aware at the time,
however, that the second
respondent had obtained approval for the
consolidation of Portion A with its property (Portion 57) instead of
with Portion 56.
In fact, Mrs Hall - whether wittingly or
unwittingly is not clear - had signed a power of attorney authorising
the second respondent
to apply for such subdivision and
consolidation.  Ostensibly being concerned not to put themselves
in a situation of legal
jeopardy, the Halls took steps to apprise the
trustees of the MHOA of the position at the time they sold their
property to the
first respondent.  The Halls had also become
concerned, even before their sale of Portion 4 to the first
respondent, that
the second respondent, which by then had ceased to
operate a polo club on Portion A, might decide to utilise the land
for further
housing development.  They considered any such
development would detract from the rural character of the area to the
detriment
of both themselves and the members of the MHOA.
[14]
The
applicant, maintaining that the provisions of clause 17 of the
agreement between the second respondent and the Halls constituted
an
agreement for its benefit, which, upon acceptance, it was entitled to
enforce against the Halls or their successor in title,
thereupon took
steps to have the relevant authorisations obtained earlier by the
second respondent to permit the subdivision of
Portion 4 and the
contemporaneous consolidation of Portion A with Portion 57 amended to
reflect approval rather for the consolidation
of the dissected
portion (by then formally designated as ‘Portion 60’)
with Portion 56.  It did not seek to procure
the required
approvals using the offices of the second respondent, however, as
might have been expected if the applicant had by
some means indeed
become privy to clause 17 of the deed of sale to which the Halls were
party, or clause 6 of the contract by which
the first respondent had
purchased Portion 4.  It instead employed a firm of professional
consultants to attend on making
the required applications.  In
the event, written consent under the Subdivision of Agricultural Land
Act was obtained by the
applicant from the Minister of Agriculture on
15 December 2016, just over two months before the first respondent
obtained registered
title of Portion 4. But the required
authorisation from the local authority that was sought in terms of
s 15(2)(h) of the
Theewaterskloof Municipality By-Law on
Municipal Land Use Planning
[3]
could not be obtained without the cooperation of the first
respondent, as registered owner of Portion 4.
[15]
Section 15(2)(h) of the By-Law provides for
an application by the owner of land or its agent for ‘
an
amendment, deletion or imposition of conditions in respect of an
existing approval
’.  The
amendment sought by the MHOA was to change the condition imposed by
the local authority when it had approved
the application for
subdivision that had been submitted by Stratovest that the subdivided
land be consolidated with Portion 57
to one providing for its
consolidation with Portion 56.  It is in dispute in this case
whether there was in fact ‘
an
existing approval
’, but assuming
that there was, only the owner of the land or its agent was competent
to apply for its amendment.  By
virtue of the definition of
‘
owner
’
in the Western Cape Land Use Planning Act 3 of 2014, which was
applicable by virtue of s 1 of the By-Law, the word
must be read
to mean ‘
the person registered in
a deeds registry as the owner of land or who is the beneficial owner
in law
’.  Hence the need for
the MHOA to enlist the cooperation of the first respondent (or
failing it, arguably Stratovest)
if it were to achieve its object.
[16]
The first respondent, represented by one
Melissa Nelsen, was not willing to provide its endorsement of the
applicant’s endeavour
to obtain an amended approval from the
local authority.  It did not wish to take sides in what it saw
as a question in issue
between the applicant and the second
respondent.  It was in particular concerned about the effect of
any circumvention of
the contractual provision that reserved to
Stratovest the responsibility for obtaining the required approvals.
[17]
In consequence of the first respondent’s
refusal to lend its assistance, the applicant instituted the current
proceedings,
in which, in terms of the notice of motion, it sought
the following relief:
…
an
Order … :
1.
Ordering the First Respondent to take all
such steps and sign such documents as may be necessary to enable the
Applicant to, at
its own cost, complete the process of sub-division
of Portion 60, a Portion of Portion 4 of the Farm 781 in the Division
of Caledon
and the consolidation thereof with Portion 56, a Portion
of Portion 4 of the farm 781 in the Division of Caledon including,
but
not limited to the following:
1.1
The granting of written consent by the
First Respondent that the Theewaterskloof Municipality may consider
and take a decision on
the application for amendment of the
conditions of approval for the subdivision of portion 4 of Farm 781,
Caledon in terms of Section 15(2)(h)
of the Theewaterskloof
By-Law on Municipal Land Use Planning, 2015 and that Condition 2 of
the Theewaterskloof Municipality approval
dated 6 February 2013 …
be amended to read as follows:
“
The
consolidation of Portion A (±7.5 ha)
with
portion 56
of Farm 781, Caledon
District, be approved subject to the following conditions:”
1.2
In the event that the application for
amendment of the conditions of approval for the subdivision of
portion 4 of farm 781, Caledon
as set out in 1.1 above is approved by
the Theewaterskloof Municipality, that the First Respondent sign all
further documents and
take such further steps as may be necessary to
enable the Applicant, at its own cost, to register the consolidation
of the abovementioned
properties in the office of the Third
Respondent [the Registrar of Deeds, Cape Town].
2.
Authorizing the Third Respondent to
register the subdivision and consolidation in the deeds registry;
3.
Authorizing and directing the Sheriff of
this honorable Court to take all such steps and sign such documents
on behalf of the First
Respondent as may be necessary to give effect
to the sub-division and consolidation described in paragraph 1 above
in the event
of the First Respondent failing to do so within a period
of 7 days from the date of this Order
4.
Granting the Applicant such further and/or
alternative relief as may be appropriate in the circumstances
5.
Ordering the First Respondent to pay the
costs of this application
6.
In the alternative to paragraph 4 above,
and in the event of the Second Respondent opposing the Application,
ordering the First
and Second Respondents to pay the costs of this
application jointly and severally, the one paying, the other to be
absolved.
[18]
The first respondent has given notice of
its intention to abide by the judgment of the court.  The third
respondent, the Registrar
of Deeds, has furnished a report to the
effect that if the applicant were to succeed in showing an
entitlement on the merits to
the relief it seeks, there would be no
reason in principle why the relief sought in paragraph 2 of the
notice of motion should
not be granted.  Only the second
respondent opposed the application.
[19]
Stratovest’s opposition to the
application was advanced on a number of grounds in the papers.
In argument, however,
it was ultimately agreed by counsel on both
sides that the crux of the case was whether, properly construed, the
provisions of
clause 6 of the agreement between the Halls and the
first respondent constituted a contract for the benefit of the MHOA
(a
stipulatio alteri
),
which, upon acceptance or adoption by the latter, would afford it the
right against the first respondent to obtain the subdivision
of the
Remainder of Portion 4 and the consolidation of the subdivided
portion (Portion 60) with the MHOA’s land (Portion
56).
Necessarily implicit in the approach of the MHOA was an acceptance
that if the contractual provisions in issue did not
evidence a
stipulatio alteri
that
had been adopted by it, it would lack standing to seek the relief
that it does.  This follows because it would be only
upon its
adoption of the right or benefit conferred by such a contract that
the applicant could have obtained legal standing to
enforce the
subdivision and transfer to it of Portion 60.
[20]
The
principles pertaining to
stipulationes
alteri
are well established.  In
Crookes
NO and Another v Watson and Others
1956 (1) SA 277
(A);
[1956] 1 All SA 227
, at 291C (SALR),
Schreiner JA observed in regard to such agreements ‘
what
is not very appropriately styled a contract for the benefit of a
third person is not simply a contract designed to benefit
a third
person; it is a contract between two persons that is designed to
enable a third person to come in as a party to a contract
with one of
the other two (cf.
Jankelow
v. Binder, Gering and Co
.,
1927 TPD 364)
’.
In
Christie’s
Law of Contract in South Africa
,
the reference to that observation is immediately followed by the
following statement ‘
In
Jankelow
v Binder, Gering & Co
,
Greenberg J had accepted the analysis suggested from the Bar by the
future judge of appeal: ‘Now I think Mr Schreiner is
right when
he says the test whether the contract is made for the benefit of a
third party is whether that third party, by adopting
the contract,
can become a party to it.
’
[4]
The
commentary continues: ‘
Schreiner
JA’s statement of the law has been generally accepted as
authoritative, is consistent with earlier cases, and was
unanimously
approved by the Appellate Division in
Joel
Melamed and Hurwitz v Cleveland Estates (Pty) Ltd
[1984] ZASCA 4
;
[1984
(3) SA 155
(A) at 172A-F].
…
Following
Hyams
v Wolf and Simpson
[1908
TS 78]
,
what we have been accustomed to call the intention to benefit the
third party is not, therefore, an intention to enrich that party
but
an intention to empower such party to adopt and become a party to the
contract if he or she wishes.  There must be a positive

intention – it is not sufficient that it would be to the third
party’s advantage to adopt and become a party to the

contract.
’
(Footnotes omitted.)
[5]
The last sentence of the commentary that I have quoted from
Christie
is borne out by the reference with approval in
Joel
Melamed
loc. cit. to the following dictum in
George
Ruggier and Co v Brook
1966 (1) SA 17
(N) at 23H: ‘
It
is entirely a question whether there is an intention that the third
party can, by adoption of the promise, become party to the
contract
in which it is embodied
’.
[6]
[21]
There is nothing to suggest that by clause
6 of the second agreement, the Halls intended to do anything other
than pass on to the
first respondent purchaser the obligations that
they had assumed in respect of the duty to give transfer of Portion A
to the MHOA
in terms of clause 17 of the contract pursuant to which
they
had
taken transfer of the Remainder of Portion 4.  The question is
therefore whether clause 17 of the deed of contract in
respect of the
sale of the Remainder of Portion 4 was intended by the parties
thereto to empower the MHOA to adopt and become party
to a contract
entitling it to obtain the subdivision of the land and the
consolidation of Portion A with its land (Portion 56),
subject only
to it paying the costs of transfer.  The answer must, of course,
be found in the proper construction of clause
17.
[22]
The oft cited synopsis provided in
Natal
Joint Municipal Pension Fund v Endumeni Municipality
[2012] ZASCA 13
(16 March 2012);
[2012] 2 All SA 262
(SCA);
2012 (4)
SA 593
(SCA) at para. 18 gives a thumbnail reiteration of the proper
approach to the interpretation of documents:
The
present state of the law can be expressed as follows. Interpretation
is the process of attributing meaning to the words used
in a
document, be it legislation, some other statutory instrument, or
contract, having regard to the context provided by reading
the
particular provision or provisions in the light of the document as a
whole and the circumstances attendant upon its coming
into existence.
Whatever the nature of the document, consideration must be given to
the language used in the light of the ordinary
rules of grammar and
syntax; the context in which the provision appears; the apparent
purpose to which it is directed and the material
known to those
responsible for its production. Where more than one meaning is
possible each possibility must be weighed in the
light of all these
factors. The process is objective not subjective. A sensible meaning
is to be preferred to one that leads to
insensible or unbusinesslike
results or undermines the apparent purpose of the document. Judges
must be alert to, and guard against,
the temptation to substitute
what they regard as reasonable, sensible or businesslike for the
words actually used. To do so in
regard to a statute or statutory
instrument is to cross the divide between interpretation and
legislation. In a contractual context
it is to make a contract for
the parties other than the one they in fact made. The ‘inevitable
point of departure is the
language of the provision itself’,
read in context and having regard to the purpose of the provision and
the background to
the preparation and production of the document.
(Footnotes
omitted.)
[23]
It is helpful to read the summary of
principles in
Endumeni
together with the remarks of Harms DP in
KPMG
Chartered Accountants (SA) v Securefin Limited and Another
[2009] ZASCA 7
(13 March
2009); 2009 (4) SA 399
(SCA) ;
[2009] 2 All
SA 523
(SCA) at para. 39:
First,
the integration (or parol evidence) rule remains part of our law.
However, it is frequently ignored by practitioners and
seldom
enforced by trial courts. If a document was intended to provide a
complete memorial of a jural act, extrinsic evidence may
not
contradict, add to or modify its meaning (
Johnson
v Leal
1980
(3) SA 927
(A) at 943B). Second, interpretation is a matter of law
and not of fact and, accordingly, interpretation is a matter for the
court
and not for witnesses (or, as said in common-law jurisprudence,
it is not a jury question: Hodge M Malek (ed)
Phipson
on Evidence
(16 ed 2005) paras 33 - 64). Third, the rules about admissibility of
evidence in this regard do not depend on the nature of the
document,
whether statute, contract or patent (
Johnson
& Johnson (Pty) Ltd v Kimberly-Clark Corporation and
Kimberly-Clark of South Africa (Pty) Ltd
1985 BP 126 (A) ([1985] ZASCA 132 (at www.saflii.org.za)). Fourth, to
the extent that evidence  may be admissible to contextualise
the
document (since 'context is everything') to establish its factual
matrix or purpose or for purposes of identification, 'one
must use it
as conservatively as possible' (
Delmas
Milling Co Ltd v Du Plessis
1955 (3) SA 447
(A) at 455B - C). The time has arrived for us to
accept that there is no merit in trying to distinguish between
'background circumstances'
and 'surrounding circumstances'.  The
distinction is artificial and, in addition, both terms are vague and
confusing. Consequently,
everything tends to be admitted. The terms
'context' or 'factual matrix' ought to suffice. (See
Van
der Westhuizen v Arnold
2002
(6) SA 453
(SCA) ([2002]
4 All SA 331)
paras 22 and 23,[
[7]
]
and
Masstores
(Pty) Ltd v Murray & Roberts Construction (Pty) Ltd and Another
[2008] ZASCA 94
;
2008 (6) SA 654
(SCA) para 7.)
The
reference by the learned Deputy President of the appeal court to
Masstores
is significant because it implies an approving endorsement of the
dictum by Lewis JA in that case that ‘…
it
is important to state that an ambiguity is not … a
precondition for a court to interpret a provision by having regard
to
the context of the contract and the surrounding circumstances
’.
[8]
[24]
Now it is clear that the terms of the
agreement by which the property was sold to the Halls were out of the
ordinary in certain
respects material to the matter currently in
issue.  The definition of the property being sold records
unequivocally that
although the purchasers would take registered
transfer of the entire cadastral unit, they would be doing so subject
to the right
of the seller (it being obviously implied with the
assistance of the new registered owners or their successors in title,
to the
extent necessary) to subdivide Portion A from it with the
purpose of enabling the transfer of that portion to the MHOA.
It
was also clear that the purchasers (and their successors in title,
if applicable) would be obliged, when the seller had succeeded
in
obtaining the requisite approvals and had put the purchasers in
receipt of them, to give transfer of the portion to the applicant

with no consideration being payable thereupon to the applicant (or
its successor in title, if applicable).
[25]
It is not clear, however, whether the
‘responsibility’ undertaken by the second respondent to
procure the requisite
approvals gave rise to an enforceable
obligation on it to do so; or, assuming that it did, whether the
obligation would be enforceable
by the purchasers (or their
successors in title), or by the MHOA.  Furthermore, although it
is not a matter that falls to
be decided in the current case, it is
also not clear what the position would be, insofar as the further
execution of the agreement
was concerned, if the applications to be
made for the requisite approvals were unsuccessful, or were granted
subject to conditions
that might be unacceptable to either the
seller, the purchasers, or even the MHOA.  It is also not clear
whether the provision
that contemplates that the applicant will be
given transfer of the subdivided portion with ‘
no
consideration whatsoever being payable by the MHOA
to
the Purchaser
in respect of such
transfer
’ implies an intention
that the MHOA would be entitled to transfer of the property for no
consideration whatsoever; and, more
particularly in that regard,
whether the provision necessarily excluded any entitlement
by
the seller
,
dehors
the contract of sale to the Halls, to any consideration from the MHOA
for the transfer to it of the land that we know had, to the
knowledge
at the time of the contracting parties and the MHOA, been
significantly developed by the seller.
[26]
The
uncertainty to which the provisions of clause 17 give rise in the
latter respect is by no means academic because it is evident
from the
definition of the
res
vendita
in the deed of sale
[9]
that the
second respondent seller did not intend to give the purchasers
beneficial ownership of the whole property, but only that
part of it
that would remain after the subdivision of Portion A, which it was
contemplated would go the MHOA.
[10]
It would be understandable in the circumstances that the purchasers
would have no expectation to be paid for property that
in terms of
the agreement they had no right to keep for themselves.  But
what about the position of the seller who undertook
the
responsibility of rendering Portion A of the cadastral unit amenable
to transfer to the MHOA?  Was it effectively undertaking
an
exercise whereby it, or the purchasers would donate the subdivided
land to the applicant?
[27]
It
is because of these uncertainties that it is necessary in this case,
if the true, import of the agreement is to be ascertained,
to examine
the language of the contract in a wider context; that is, beyond the
context of the language of the clause itself read
in the deed as a
whole, but also with regard to the factual matrix within which the
agreement was concluded, including ‘the
circumstances attendant
upon its coming into existence’, and ‘the apparent
purpose to which it is directed and the
material known to those
responsible for its production’.
[11]
When that is done, the understanding between the second respondent
and the applicant recorded in the minutes of the trustees’

meeting of 29 September 2009 is obviously significant.  The
minutes make it clear that the intention by the second respondent
to
procure the subdivision and transfer of Portion A to the
applicant was conditional upon counterprestation by the MHOA.

It had to put in place arrangements that would permit the repayment
by the second respondent of the loan it had obtained to finance
the
development of the clubhouse and that would also secure long-term
leasehold rights for the second respondent over the property
upon
which the second respondent was then operating a polo club and
equestrian centre.  It therefore becomes clear when regard
is
had to the factual matrix that any notion of the applicant becoming
entitled to obtain the property entirely free of consideration
would
be at odds with Stratovest’s intentions, and there is nothing
to suggest that Halls, when they purchased the property
as defined in
the deed of sale, had any independent intentions with regard to the
portion of the cadastral unit of which they would
not be obtaining
beneficial ownership.
[28]
The MHOA can hardly be heard in those
circumstances to say that the proper import of the agreement was to
empower it by notice to
the purchasers (or their successor in title)
to obtain transfer of the property free of consideration.  Yet
that, in essence,
is what it seeks to achieve by means of the relief
sought in this application.
[29]
And it seeks to do so by usurping the role
reserved to the seller in terms of the agreement to be in charge of
the approval application
process.  The reason for the
‘responsibility’ being placed by clause 17 on the seller
to obtain the requisite
approvals might not be clear from the
language of agreement read in abstract, but it does become clear when
the clause is interpreted
with reference to the factual matrix.
The context bears out Mr Stuart’s averment that the
responsibility was reserved
to the seller so that (as recorded in
paragraph [10]
above)
‘
[t]
he
Second Respondent was protected by the fact that only it (and not the
purchaser, nor the Applicant) would be authorised to obtain
the
relevant approvals for subdivision and consolidation (but only in the
event of the applicant meeting its end of the bargain)
’.
[30]
The question as to what is to become of
Portion A now that it has become evident that the arrangements
contemplated in terms of
the understanding recorded in the minutes of
the 29 September 2009 trustees’ meeting will not be
realised is not addressed
by the provisions of the agreements, and
whether clause 17 effectively provided all of the protections that
Mr Stuart contends
it was directed towards is also far from
certain.  But those are not questions that require to be
answered in the current
proceedings.  It is sufficient to hold
only that the agreement between the Halls and the second respondent,
and clause 6 of
the subsequent agreement between the Halls and the
first respondent, did not enable the applicant, by its election, to
become party
to a contract entitling it to require the current owner
of Portion 4 to cooperate with it to obtain the subdivision of
Portion
A and its attendant consolidation free of any consideration
with its own property, Portion 56.
[31]
But
even were I wrong that the clauses in issue did not constitute a
stipulatio
alteri
,
I consider that construed in the manner for which the applicant
contends they would offend against the prohibition in s 3(e)
of
the Subdivision of Agricultural Land Act against the granting of a
right to an undivided portion of agricultural land without

ministerial consent, and on that account fall to be regarded as
void.  This was not a point taken by the second respondent,
but
it occurred to me in the course of preparing the judgment.  As
it went to an issue of legality I considered that the court
was duty
bound to address it
mero
motu
,
[12]
even if it arises for consideration only as a fallback position in
support of the conclusion at which I have arrived primarily
along
other lines.  Counsel were accordingly invited to make written
submissions on the point, which have been gratefully
received and
duly considered.
[32]
Section 3 of the Subdivision of
Agricultural Land Act provides:
Prohibition
of certain actions regarding agricultural land.
—Subject to
the provisions of section 2—
(
a
)
agricultural land shall not be subdivided;
(b)
no undivided share in agricultural land not already held by any
person, shall vest in any person;
(c)
no part of any undivided share in agricultural land shall vest in any
person, if such part is not already held by any person;
(d)
no lease in respect of a portion of agricultural land of which the
period is 10 years or longer, or is the natural life of the
lessee or
any other person mentioned in the lease, or which is renewable from
time to time at the will of the lessee, either by
the continuation of
the original lease or by entering into a new lease, indefinitely or
for periods which together with the first
period of the lease amount
in all to not less than 10 years, shall be entered into;
(e)
(i) no portion of agricultural land, whether surveyed or not, and
whether there is any building thereon or not, shall be sold
or
advertised for sale, except for the purposes of a mine as defined in
section 1 of the Mines and Works Act, 1956 (Act No. 27
of 1956); and
(ii)
no right to such portion shall be sold or granted for a period of
more than 10 years or for the natural life of any person
or to the
same person for periods aggregating more than 10 years, or advertised
for sale or with a view to any such granting, except
for the purposes
of a mine as defined in section 1 of the Mines and Works
Act, 1956;
(
f
)
no area of jurisdiction, local area, development area, peri-urban
area or other area referred to in paragraph (
a
) or (
b
) of
the definition of “agricultural land” in section 1,
shall be established on, or enlarged so as to include,
any land which
is agricultural land;
(g)
no public notice to the effect that a scheme relating to agricultural
land or any portion thereof has been prepared or submitted
under the
ordinance in question, shall be given,
unless
the Minister has consented in writing.
Paragraph
(e) falls to be read mindful of the definition of ‘sale’
in s 1 of the Act, viz. ‘“
sale
”
includes
a sale subject to a suspensive condition; and “
sold
”
shall have a corresponding meaning
’.
[33]
The
history of the provision was discussed in
Geue
and Another v Van Der Lith and Another
[2003] ZASCA 118
(20 November 2003)
[2003] ZASCA 118
; ;
[2003] 4 All SA 553
(SCA);
2004
(3) SA 333
(SCA) and
Adlem
and Another v Arlow
[2012] ZASCA 164
(19 November 2012);
[2013] 1 All SA 1
(SCA);
2013
(3) SA 1
(SCA).  The section comprised originally of only
paragraphs (a) to (c).  The supplementary provisions in
paragraphs (d)
to (g) were introduced by way of a series of statutory
amendments during the period from 1972 until 1981.  It is
evident from
the character of those amendments that the legislative
intention was to considerably widen the limitations in respect of any
dealings
with undivided portions of agricultural land without the
prior written consent of the Minister.  This much was
highlighted
by the amendment of the Act by way of insertion of the
additional paragraphs in s 3 and also the insertion, in 1981, of
the
special definition of ‘sale’ (quoted in the preceding
paragraph) to include a sale subject to a suspensive condition.
[13]
The effect of the latter amendment was to exclude the ability to
contract to sell an undivided portion of agricultural land
subject to
the Minister’s consent being obtained, thus negating the effect
of the judgment in
Corondimas
v Badat
1946 AD 548.
[14]
In
Geue
at para. 15, Brand JA noted that it became clear that the
purpose of the legislation was not only to prevent alienation of

undivided portions of land; its ‘
target
zone
’,
said the learned judge of appeal, was actually ‘
much
wider
’.
He remarked that it was purposeless, when the wording of the
provision expressed the legislature’s intention
very clearly,
to speculate why it should have wanted to cast the net so widely.
[34]
The construction of the contractual clauses
contended for by the applicant necessarily implies an agreement
between Stratovest and
the Halls, alternatively, between the Halls
and the first respondent, intended by those parties, upon adoption by
the MHOA, to
grant a right to the latter to obtain ownership of
Portion A, subject only to certain statutory approvals, including
that required
in terms of s 3 of Subdivision of Agricultural
Land Act.  I have rejected that contention, but were I wrong in
that conclusion,
the purported granting of such a right would fall
foul of the prohibition in s 3(e)(ii) of the Act in my judgment.
[35]
Section 3(e)(ii) permits the grant, without
written consent from the Minister, of a right to an undivided portion
of agricultural
land for a period less than 10 years, or to the same
person for any number of periods ‘aggregating’ less than
10 years.
It also permits the grant of a right to such a
portion for the purpose of a mine.  But the grant of any right
to such
a portion which does not fall into any of those categories
cannot be made without ministerial consent.  It follows that a
stipulatio alteri
of the nature contended for by the applicant, one that granted the
applicant a
ius ad rem acquirendam
,
could not be made legally without the prior written consent of the
Minister.  On this basis too, the right that the applicant

purports to exercise in seeking the relief it does in these
proceedings could not be recognised.
[36]
In the result, the following order is made:
1.
The application is dismissed.
2.
The applicant shall pay the second
respondent’s costs of suit.
A.G.
BINNS-WARD
Judge
of the High Court
APPEARANCES
Applicant’s
counsel:

G.C. Roux
Applicant’s
attorneys:

Guthrie & Theron
Hermanus
Michalowsky,
Geldenhuys & Humphries
Cape
Town
Second
respondent’s counsel:

M. Harrington
Second
respondent’s attorneys:

Hilgard Bell Attorneys
Stellenbosch
STBB
: Smith Tabata Buchanan Boyes
Cape Town
[1]
Section
4(1)(a)(i) provides: ‘
Any
application for the consent of the Minister for the purposes of
section 3 shall—
(i)
in the case where any act referred to
in paragraphs (a) to (e) of that section is contemplated, be made by
the owner of the land
concerned
’
.
(The
contemplated subdivision was an act referred to in s 3(a) of
the Act.  The text of s 3 is set out in para. [31]
below.)
[2]
Section
4(1)(b) provides: ‘
For
the purposes of paragraph (a) “owner” shall have the
meaning assigned to it in section 102 of the Deeds Registries
Act,
1937 (Act No. 47 of 1937)
.’
‘
Owner
’
is defined in s 102 of Act 47 of 1937 in the following terms
insofar as relevant to the current case: ‘…
in
relation to—
(a)
immovable property, … the person
registered as the owner or holder thereof
…’
.
[3]
Promulgated
in Western Cape P.N. 229/2015 published in the Province of the
Western Cape Provincial Gazette Extraordinary 7429,
dated 20 July
2015.
[4]
GB
Bradfield (original text by RH Christie),
Christie's
Law of Contract in South Africa
7ed
(LexisNexis, 2016) at p. 308.
[5]
Id.
[6]
Cf. also
Total
South Africa (Pty) Ltd v Bekker NO
[1991] ZASCA 183
(28 November
1991); 1992 (1) SA 617
(A) at 625
D-G; and
Pieterse
v Shrosbree and Others , Shrosbree v Love and Others
[2004] ZASCA 129
(23 September
2004); 2005 (1) SA 309
(SCA);
[2006] 3 All SA 343
(SCA) at para. 9.
[7]
This
would appear to have been an intended reference to paras. 21 and 22.
[8]
It
is not altogether clear, but the context suggests that when Harms
DP, despite endorsing
Masstores
,
nevertheless reiterated the principle of the ‘conservative
use’ of evidence to contextualise a document for
the purposes
of interpreting it, he meant that the use of such evidence should
not detract from the strictly objective character
of interpretation.
[9]
See paragraph [3] above.
[10]
Having
regard to the abstract system that applies in respect of the
transfer of property in South African law, one might even
question
whether there was a real agreement (i.e. the mutual intention)
between Stratovest and the Halls in respect of passing
from the
former to the latter of the real rights to Portion A; cf.
Legator
McKenna Inc and Another v Shea and Others
[2008] ZASCA 144
(27 November
2008); 2010 (1) SA 35
(SCA);
[2009] 2
All SA 45
(SCA) at para. 22.  The seller’s intention
appears to have been to pass ownership of Portion A to MHOA, not to

the Halls, which is explained by Stratovest assuming responsibility
to obtain the necessary approvals for the subdivision required
to
achieve that.  The question was not addressed in argument,
however, and, as will appear, it has not been necessary to
answer
it.
[11]
Cf.
Endumeni
supra, loc cit.
[12]
Cf.
CUSA
v Tao Ying Metal Industries and Others
[2008] ZACC 15
(18 September
[2008] ZACC 15
;
2008); 2009 (2) SA 204
(CC);
2009 (1)
BCLR 1
(CC) at para. 68.
[13]
The
definition was inserted into the Act with effect from 4 March
1981 in terms of s 1(c) of the Subdivision of Agricultural
Land
Amendment Act 18 of 1981.
[14]
Corondimas
was concerned with the legality of a contract of sale that was
subject to the Trading and Occupation of Land (Transvaal and Natal)

Restriction Act 35 of 1943 (since repealed) and might validly be
concluded only with ministerial permission.  The Appellate

Division held that a contract concluded subject to a suspensive
condition that the required permission be obtained did not offend

against the statutory restriction and was valid.