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[2020] ZAGPJHC 100
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Zondo and Others v City of Johannesburg Metropolitan Municipality and Others (2016/13293) [2020] ZAGPJHC 100 (7 April 2020)
IN THE HIGH COURT OF
SOUTH AFRICA
GAUTENG
LOCAL DIVISION, JOHANNESBURG
CASE
NO. 2016/13293
In
the matter between:
CEBOLAKHE
ZONDO AND 299 OTHERS
and
THE CITY OF
JOHANNESBURG
METROPOLITAN
MUNICIPALITY FIRST
RESPONDENT
JOHANNESBURG SOCIAL
HOUSING
(PTY)
LIMITED SECOND
RESPONDENT
DILUCULO
(PTY)
LIMITED THIRD
RESPONDENT
PENNYVILLE
HOUSING (PTY) LIMITED FOURTH
RESPONDENT
ERF
238 STORMILL X9 (PTY)
LIMITED FIFTH
RESPONDENT
REGISTRAR: DEEDS
REGISTRY
JOHANNESBURG SIXTH
RESPONDENT
JUDGMENT
MODIBA
J:
[1]
The applicants seek an order declaring the
agreement entered into between the City of Johannesburg Metropolitan
Municipality (“the
City”) and Diluculo (Pty) Ltd
(“Diluculo”) on 25 September 2008, unlawful and void
ab
initio
. They are desirous to have the
agreement set aside. They also seek an order cancelling lease
agreements concluded between Diluculo
and its successors in title and
the applicants, as well as other ancillary relief.
[2]
The City and Johannesburg Social Housing (Pty)
Limited did not oppose the application. Only Diluculo, Pennyville
Housing (Pty) Ltd
(“Pennyville”) and ERF 238 Stormill X9
(Pty) Ltd (“Stormill”) did.
[3]
The court heard oral argument on behalf of
Diluculo. Pennyville aligned itself with Duliculo’s written and
oral argument.
Absurdly, Stormill had no appearance; neither did it
align itself with Diluculo’s submissions, yet it filed opposing
papers
jointly with Pennyville. A Windeed search document annexed to
Diluculo’s heads of argument evidences that Stormill does not
exist. This is another absurd development, given that Stormill is
opposing the application. The applicants did not object to the
document being admitted into court in this informal manner. In any
event, given the basis on which the issues that arise in this
application stand to be resolved, Stormill’s existence or
otherwise pales into irrelevance.
[4]
The City and Diluculo concluded the
impugned agreement of sale in respect of certain immovable properties
that are described in
detail in the founding papers, situated in
Pennyville. The property in dispute is one of these properties. It
comprises of residential
rental units occupied by the applicants. For
brevity, I simply refer to the latter property as (“the
property”).
[5]
The applicants brought the application in
two parts, A and B. They brought Part A on the basis of urgency.
There they sought to
interdict the City, Diluculo, its successors in
title and their agents from collecting rental from the cited
applicants and to
make available to the applicants several documents
relating to the impugned sale agreement, the improvements effected on
the property
and other ancillary documents.
[6]
Part B is brought in respect to the relief
set out in paragraph 1 above.
[7]
Part A was struck from the roll due to lack
of urgency. Part B, in respect of which the application is enrolled
in the ordinary
course, renders the relief sought in Part A academic.
[8]
The basis on which the applicants allege
that the impugned agreement of sale was unlawfully concluded is that
the City acquired
the property in terms of the Land Exchange
Development Agreement (“LEDA”) solely for the purpose of
developing social
housing for the benefit of the applicants. The City
would pay to the seller, the agreed purchase price including the cost
of developing
various residential units against the registration of
each residential unit in the name of the respective beneficiaries.
The said
purchase price shall not exceed the subsidy amount which
each beneficiary is entitled to receive from the state. Further, the
City
will identify the beneficiaries and grant them occupation of the
respective residential units.
[9]
The applicants further allege that contrary
to the terms of the LEDA, the City sold the property and/ or the
residential units occupied
by the applicants to Diluculo.
Furthermore, on 29 May 2015, Diluculo unlawfully onsold the units
occupied by the applicants to
Pennyville, who since September 2015
has been fraudulently collecting rentals from the applicants through
Stormill, its managing
agent. The applicants also detail various
unlawful actions allegedly perpetrated by Diluculo and Pennyville’s
respective
property management agents.
[10]
The applicants further alleged that this
conduct on the part of the City resulted in the applicants losing
their constitutional
right of access to housing without due process.
[11]
Diluculo raises two preliminary points on
the basis of which I find that the application stands to be dismissed
with costs.
[12]
The applicants allege the existence of an
agreement concluded with the City, in terms of which the residential
units occupied by
each applicant would be transferred to such
applicant after a stipulated period. The following provisions in ALA
are relevant to
determine the applicants’ contended right to
the transfer of the residential units:
““
Alienate”,
in
relation to land, means sell, exchange or donate, irrespective of
whether such sale, exchange or donation is subject to a suspensive
or
resolutive condition, and “
alienation”
has
a corresponding meaning.”
““
Deed
of alienation
” means a
document or documents under which land is alienated.”
“
Land”
—
(a)
includes—
(i)
Any unit;
(ii)
any right to claim transfer of land;
(iii)
any undivided share in land;
(iv)
initial ownership referred to in section 62 of the Development
Facilitation Act, 1995;
(b)
includes, in Chapters I and III, any interest in land, other than a
right or interest registered or capable of being registered
in terms
of the Mining Titles Registration Act, 1967 (Act No. 16 of 1967);
Section
2 –
(1)
‘
No alienation of land after
the commencement of this section shall, subject to the provisions of
section 28, be of any force or
effect unless it is contained in a
deed of alienation signed by both parties thereto or by their agents
acting on their written
authority.’
[13]
The
alleged agreement falls within the purview of the Alienation of Land
Act
[1]
(“ALA”), as
it involves the transfer of immovable property. Transfer of land
falls within the definition of alienate.
Residential unit falls
within the definition of land. Section 2 (1) prescribes formalities
for an agreement for the alienation
of land. It is trite that unless
an agreement complies with prescribed formalities, it is not legally
binding. The alleged agreement
ought to comply with the formalities
set out in section 2(1) of the ALA. Absent such compliance, the
parties' agreement does not
give birth to consequences of a legal
nature and cannot be enforced.
[14]
The agreement allegedly concluded between
the applicants and the City ought to be in writing, otherwise it is
of no force or effect.
It is common cause that such an agreement, if
it was concluded, was never reduced to writing.
[15]
Even if such an agreement was validly
concluded in terms of the statutory provision referred to above, on
the applicant’s
own version, their cause of action arising from
such agreement prescribed in April 2015. They only instituted the
present application
in April 2016.
[16]
Section
11 (d) of the Prescription Act
[2]
provides:
“
11. Periods
of prescription of debts.
—
The
periods of prescription of debts shall be the following:
(
d
)
save where an Act of Parliament provides otherwise, three years in
respect of any other debt.”
[17]
In
eThekwini
(Constitutional Court),
[3]
interpreting the above provision, the court held that the dictionary
definition of debt – an obligation to pay money, deliver
goods,
or render services – includes a claim to transfer immovable
property. The claim to transfer an immovable property
is essentially
a claim to deliver goods. It is therefore a debt that satisfies the
definition of a debt in the Prescription Act.
[18]
I therefore find that even if the
applicants were able to prove the existence of a valid agreement with
the City as alleged, each
applicant’s claim for the transfer of
the residential unit that they occupy is a debt as defined in section
11 (d). It prescribed
three years after the applicants became aware
of the cause of action that they rely on in this application.
[19]
Even more problematic for the applicants is
that they are not party to the LEDA concluded between the City and
Diluculo. They derive
no rights from it. Further, the LEDA does not
contain any provision relating to the applicants’ alleged right
to the transfer
of the units that they occupy.
[20]
I find that the applicants fail to make out
a case for the relief sought. In the premises, the application stands
to be dismissed
with costs.
[21]
I record my displeasure with non-compliance
with the requirement in the practice directive regarding the
pagination, indexing and
the size of bundles. Such non-compliance
presented a grave difficulty in navigating the voluminous papers
filed in this application.
______________________________
MS
L T MODIBA
JUDGE
OF THE HIGH COURT
APPEARENCES:
Counsel for the
applicant: Adv B T Ngqwangele
Instructed by: HB Mphamba
Attorneys
Counsel for the third
and fourth respondent:
Advocate NJ Horn
Instructed by: Tim du
Toit (for the third respondent) and CR Bothma and Jooste (for the
fourth and fifth respondent)
Date
of judgment: 7 April 2020
[1]
68 of 1981.
[2]
69
of 1968
[3]
eThekwini
Municipality v Mounthaven (Pty) Limited
[2018]
ZACC 43.