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[2014] ZAGPJHC 382
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Scheepers and Another v Van Niekerk (16907/10) [2014] ZAGPJHC 382 (29 October 2014)
REPUBLIC OF SOUTH
AFRICA
SOUTH GAUTENG HIGH
COURT
JOHANNESBURG
CASE NO: 16907/10
DATE: 29 OCTOBER 2014
In the matter between:
SCHEEPERS: JOHANNES
EGBERTUS
............................
First
Applicant
MILLENIUM ADVERTISING
CC
...................................
Second
Applicant
And
VAN NIEKERK: ILZE
FOURIE
...............................................
Respondent
JUDGEMENT
CARSTENSEN AJ:
1. In this matter, the Applicants
originally sought an order compelling the Respondent to sign a deed
of sale in terms of which
portion 67 (a portion of portion 57) of the
Farm Brakkloof number 443, measuring 8565m² held in term of
title deed T14689/89,
is sold by her to Seven Falls Trading 101 (Pty)
Ltd for the sum of R17 625 000.00 and to do all things necessary to
transfer the
property to Seven Falls within 7 days of the order,
alternatively that the Sheriff should sign the deed of sale.
2. At the hearing the Applicants,
without the objection of the Respondent, indicated that they would
seek a more limited relief,
namely:
2.1. That the Respondent’s
cancellation dated the 24th of February 2014 of the Plettenberg Bay
property portion of the settlement
agreement dated the 3rd of August
2012 which was made an order of court on the 3rd of August 2012 under
case number 16907/10 is
invalid;
2.2. That the Respondent be directed to
pass transfer of the property to the Applicants or the Applicants’
nominee , on payment
of the balance of the purchase price.
3. The First Applicant and Respondent
had lived together as husband and wife and during that time, a number
of properties including
the Plettenberg Bay property, the RV house,
the Vaal River property and the Ontdekkers Road property were
purchased by the Applicant
and registered in the name of the
Respondent.
4. During 2002 / 2003, the parties
relationship came to an end and what the parties called a “divorce
agreement”, was
concluded on the 7th of September 2004.
5. The Applicant, on the 5th of
November 2004, had paid the Respondent an amount of R6 463 249.96 in
part settlement.
6. That agreement was made an order of
court on the 3rd of August 2012.
7. In terms of that agreement:
7.1. The Plettenberg Bay property, the
RV house and the Vaal River property would be valued and the agreed
value would be the average
value.
7.2. The payment of R6 463 249.96 was
recorded.
7.3. The parties agreed that the
Applicant would take transfer of the properties and make payment to
the Respondent in respect thereof.
8. The Ontdekkers Road property had
been sold and was not included in the settlement agreement.
9. The parties subsequently agreed that
the Vaal River property would be excluded from the settlement
agreement, this is not in
dispute.
10. Also subsequent to the settlement
agreement, the RV House was sold and the proceeds of R2 368 000.00
was paid to the Respondent
on the 8th of April 2014.
11. Consequently, the only outstanding
issues in relation to the settlement agreement was the valuation of
the Plettenberg Bay property,
the transfer of that property to the
Applicant and the payment therefore by the Applicant.
12. The parties did not agree on a
valuation and consequently, on or about 25th of March 2014, this
court granted an order that
the date of final determination of the
agreed value of the properties was 2nd December 2012 in the 12 months
period provided for
in clause 2.5 of the settlement agreement,
commenced to run on that date and would expire on the 1st of December
2013.
13. The court, in its judgement, was
very critical of the conduct of the Applicant. During the
proceedings, the Applicant conceded
that the true value of the
Plettenberg Bay property was the amount of R17 625 000.00.
14. Notwithstanding the fact that the
1st of December 2013 came and went, transfer of the property was not
affected into the name
of the Applicant and neither did the Applicant
make payment in respect thereof.
15. Consequently, on the 12th of
February 2014, the Respondent’s attorney put the Applicant on
terms to make payment of the
purchase price for the Plettenberg Bay
property or to deliver guarantees, failing which they would cancel,
on behalf of their client,
that portion of the settlement agreement.
16. The Applicant did not react to that
letter.
17. Thus, on the 24th of February 2014,
the Respondent’s attorneys cancelled the Plettenberg Bay
portion of the settlement
agreement.
18. The Applicant has adopted the
attitude that the cancellation is invalid and seeks to enforce the
settlement agreement.
19. The Applicant contended that the
cancellation was invalid for three reasons.
20. Firstly, there had been no breach
of the settlement agreement as the Applicant was not obliged to make
payment of the balance
until transfer had taken place. In this
regard, the Applicant relied on:
20.1. Clause 2.3 of the settlement
agreement: “In return, Scheepers (or his nominee) will take
transfer of the Plettenberg
Bay property and the RV House against
payment of the balance and all costs to give effect to the transfer,
Scheepers will be entitled
to appoint a transferring attorney”.
20.2. Clause 2.5 of the settlement
agreement: “The balance is payable by Scheepers to Van Niekerk
on transfer of the properties
which shall take place by no later than
12 months from the date of final determination of the value of the
three properties”.
21. I do not believe that the
Applicant’s contention in this regard is correct. Firstly, it
is my view that on a proper interpretation
of the settlement
agreement, that it was the Applicant’s obligation:
21.1. To appoint the transferring
attorneys;
21.2. To pay all the transfer costs;
21.3. To take transfer; and
21.4. Against transfer, to make payment
of the value.
22. I believe to argue payment could be
made simultaneously with transfer is unrealistic and does not take
into account the practice
or practical consequences of transfer.
22.1. In the main, the purchaser would
present some form of guarantee to secure the purchase price.
Transfer is then registered
before the Registrar of Deeds and once
that occurs, the guarantee, in whatever form it may take, is
presented and payment effected.
22.2. Should transfer take place
without guarantees, a seller could be in a position of being no
longer the registered owner of
the property and face the prospect of
having to sue, a possibly indigent or recaltent purchaser for the
purchase price.
23. In any event, the First Applicant,
I was assured in argument by Mr Wickins who appeared on behalf of the
Applicant, that his
client was wiling, able and in a position to make
payment of the purchase price.
24. Consequently, there seems to be no
reason why the Applicant has not given a guarantee as requested,
albeit perhaps in the alternative,
by the Respondent’s
attorney. The only motive seems to be to delay the process or to
frustrate the Respondent, as was carefully
pointed out by Judge
Wepener in his judgement.
25. Consequently, I am of the view that
the Applicant was indeed in breach of the agreement and consequently,
in contempt of the
order of court, in failing to take transfer and to
make payment of (or at least secure) the purchase price.
26. The second argument which the
Applicant raised was that the settlement agreement constituted an
indivisible transaction and
to cancel a portion of the settlement
agreement was impossible or inappropriate and would result in the
Respondent approbating
and reprobating insofar as the Respondent
would seek to enforce the contract and cancellation it at the same
time.
27. I, again, do not agree with the
Applicants’ submissions in this regard.
28. Firstly, the parties clearly
regarded the settlement agreement as “divisible” insofar
as they had already:
28.1. Excluded the Vaal River property
from the settlement agreement;
28.2. Allowed the RV House to be sold
and payment to be made to the Respondent.
29. Secondly, the only remaining aspect
was the transfer of the Plettenberg Bay property and the payment of
the value thereof to
the Respondent, which value had been settled in
the amount of R17 625 000.00.
30. There seems, therefore, to be no
bar to either enforcing or cancelling this portion of the agreement.
31. The one difficulty, however, I may
point out is that apart from the Vaal River property and the RV
House, the Applicant had
made payment to the Respondent of the sum of
R6 463 249.96.
32. During argument, it was made clear
by the Respondent’s counsel that the Respondent would not
tender return of that amount
should I find in favour of the
Respondent and thus find that the Respondent’s cancellation of
the portion of the settlement
agreement was valid and enforceable
and, as a result, dismiss the application.
33. This in itself is not an obstacle
and does not render the settlement agreement, in my view, legally
indivisible.
34. The final point raised by the
Applicant was that the settlement agreement had been made an order of
court and consequently,
it could not simply be cancelled.
35. To meet this claim the Respondent
contended that this in fact this was the Respondent’s only
option as the other remedies,
such as contempt proceedings could be
met with the plea impecuniosity as could an order for specific
performance.
36. The Respondent argued that despite
the fact that the settlement agreement had been made an order of
court, it remained of a
contractual nature. In this regard, the
Respondent distinguished the decision of Flemming J in Johannesburg
Taxi Association v
Barra-City Taxi Association,
1989 (4) SA 808
(W).
This matter created some uncertainty whether the non-compliance of a
settlement agreement could be contempt, notwithstanding
the fact that
it had been made an order of court.
37. Webster J, in the unreported
decision of Hanekom v Hanekom, 2008 JDR 1277 (T), found that no party
to an agreement that had
been incorporated into a court order could
repudiate it. Particularly then no party could cancel it.
38. It is my view that parties who
decide to make a settlement agreement an order of court must abide by
that consequence. That
is that that settlement agreement becomes an
order of court and cannot be repudiated or cancelled. This may give
rise to many
difficulties and impracticalities as were referred to by
Flemming J. However, the only manner by which the “agreement”
could then be varied, altered or set aside is through normal court
process as provided for in the main by the Uniform Rules of
Court.
39. Consequently, I am of the view that
the Respondent’s cancellation dated 24th of February 2014 in
the Plettenberg Bay property
portion of the settlement agreement
dated 3rd August 2012, which was made an order of court on the 3rd of
August 2012 under case
number 16907/10, is invalid.
40. However, that does not result in
the Applicant being entitled to the relief which he seeks.
41. It is clear from the parties
argument and submissions that should the settlement agreement have
been cancelled, the Applicant
would have to sue the Respondent for
payment of the R6 463 249.96.
42. It is also clear to me, taking into
account the Applicant’s attitude that should transfer of the
property take place,
the Respondent would be in a positon and would,
in all likelihood in my view, have to institute action against the
Applicant for
payment of the balance of the purchase price.
43. Consequently, I am of the view that
the Applicant should not be entitled to take transfer until payment
has been secured.
44. This would put an end to the
litigation between the parties.
45. I suggested to counsel for the
Applicant that a proper order would be that the Applicant provide
guarantees to secure the purchase
price and then take transfer of the
property. The Applicant consented to such an order being made, on
the terms set out hereunder.
46. The Applicant also agreed that
should the guarantee not be presented, then the entire court order
which incorporated the settlement
agreement, could be set aside.
47. In light of those concessions, I am
prepared to make an order that the Applicant is entitled to take
transfer of the Plettenberg
Bay property on the basis set out below.
48. The Applicant’s delay of
taking transfer and making payment in respect of the Plettenberg Bay
property from December 2012
to date is inexcusable. The Applicant’s
attitude that payment need only be made on transfer is impractical,
has led to an
understandable frustration on the part of the
Respondent and has triggered a sequence of events which led to this
application.
49. On the other hand, the Respondent’s
view that it could cancel a court order is unreasonable. In
addition, I am of the
view that allowing the Applicant 7 (seven) days
to present guarantees was impractical.
50. Consequently, I am of the view that
neither party should be entitled to costs in respect of this
application.
51. In the premises, I make the
following order:
51.1. The Respondent’s
cancellation dated the 24th of February 2014 of the Plettenberg Bay
property portion of the settlement
agreement dated 3rd August 2012,
which was made an order of court on the 3rd of August 2012 under case
number 16907/10, is invalid.
51.2. The Applicant is directed to
present a written bankers’ guarantee in the sum of R17 625
000.00 as well as to secure
all transfer fees, costs and duties to
the transferring attorneys within 45 (forty five) days from date of
this order.
51.3. The Applicant is directed to
appoint transferring attorneys and the Respondent is directed to do
all things necessary to pass
transfer of the property described as
portion 67 (a portion of portion 57) of the Farm Brakkloof number
443, measuring 8565m²
held under title deed T14689/89, to the
Applicant or to the Applicant’s nominee, within 120 (one
hundred and twenty) days
from date of the guarantee.
51.4. In the event that the Applicant
does not present the guarantee within the aforesaid time period or in
a form acceptable to
the transferring attorneys, the court order
incorporating the settlement agreement dated 3rd of August 2012 under
case number 16907/10
is set aside immediately on expiry of the 90
(ninety) day period.
51.5. Insofar as that court order may
be set aside, the parties rights and ownership in respect of the Vaal
River property and the
RV House, remain unaffected by such setting
aside.
51.6. Each party is to pay their own
costs of this application.
P L CARSTENSEN
ACTING JUDGE OF THE
HIGH COURT
HEARD: 13 OCTOBER 2014
DELIVERED: 29 OCTOBER 2014
COUNSEL FOR APPLICANTS: GD WICKINS
INSTRUCTED BY: BROOKS & BRAND
INC.
COUNSEL FOR RESPONDENT: GP VAN RHYN
INSTRUCTED BY: OTTO KRAUSE INC.
(jmt.20.10.14)