Minister of Agriculture and Land Affairs and Another v De Klerk and Others (747/2012) [2013] ZASCA 142; 2014 (1) SA 212 (SCA); [2014] 1 All SA 158 (SCA) (30 September 2013)

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Minister of Agriculture and Land Affairs and Another v De Klerk and Others (747/2012) [2013] ZASCA 142; 2014 (1) SA 212 (SCA); [2014] 1 All SA 158 (SCA) (30 September 2013)

THE SUPREME COURT OF APPEAL OF
SOUTH AFRICA
JUDGMENT
Reportable
Case
No: 747/2012
In
the matter between:
MINISTER OF AGRICULTURE AND LAND AFFAIRS
..........................
First
Appellant
DEPUTY DIRECTOR: FINANCE IN THE OFFICE OF
THE HEAD OF LAND CLAIMS COMMISSION
.................................
Second
Appellant
and
CAROLA MARIA DE KLERK
.............................................................
First
Respondent
SECHELE INCORPORATED
........................................................
Second
Respondent
NICOLAS
KOBEDI SECHELE
...........................................................
Third
Respondent
Neutral
citation:
Minister of Agriculture v C M De Klerk
(747/2012)
[2013] ZASCA 142
(30 September 2013)
Coram:
Navsa ADP, Cachalia and Majiedt JJA and
Van der Merwe and Meyer AJJA
Heard:
30 August 2013
Delivered: 30 September 2013
Summary: Sale – Immovable property –
whether conveyancer agent of seller or of purchaser in receiving
payment of the
purchase consideration from purchaser before payment
thereof due to seller.
_________________________________________________________________________
ORDER
On appeal from:
the North Gauteng High Court,
Pretoria (Hiemstra AJ sitting as court of first instance):
1. The first appellant’s appeal is dismissed, with
costs.
2. The second appellant’s appeal is upheld, with
costs.
3. The order of the court a quo is set aside and there
is substituted an order which reads:
The first defendant is ordered to pay to the plaintiff:
(a) The sum of R1 001 971.50;
(b) Interest on the sum of R1 200 000.00 at the rate of
15,5% per annum from 22 May 2009 to 9 June 2009;
(c) Interest on the sum of R1 850 000.00 at the rate of
15,5% per annum from 29 May 2009 to 9 June 2009;
(d) Interest on the sum of R1 021 971.50 at the rate of
15,5% per annum from 9 June 2009 to 19 August 2009;
(e) Interest on the sum of R1 001 971.50 at the rate of
15,5% per annum from 19 August 2009 until date of payment;
(f) Costs of suit.
___________________________________________________________________
JUDGMENT
MEYER AJA (CACHALIA JA et VAN DER MERWE AJA
concurring):
[1] This is an appeal with leave of the court a quo,
against the judgment and order of Hiemstra AJ, sitting in the North
Gauteng
High Court. The first and second appellants, the Minister of
Agriculture and Land Affairs and the Deputy Director: Finance in the

Head Land Claims Commissioner’s Office, were ordered jointly
and severally to pay to the first respondent the sum of R1,
001,
971.50 plus interest and costs. The dispute between the parties –
seller and purchaser – arose from the misappropriation
by the
appointed conveyancer of money paid into his trust account pending
the registration and transfer of immovable properties.
[2] On 22 August 2008, a written agreement of sale was
entered into between the first respondent (seller) and the National
Department
of Land Affairs (purchaser). The sale related to the
purchase of immovable properties - portions 49 and 50 of the farm
Leeuwpoort
283, Mpumalanga (the properties) - which were owned by the
seller. The following recordal in the preamble of the deed of sale
provides
the context within which it was concluded:
‘
A.
The Seller is the registered owner of the Properties.
B. Claims have
been lodged on behalf of the beneficiaries of the MANALA MGIBE CPA
1
in respect of the
Properties in terms of the
Restitution of Land Rights Act, 22 of
1994
.
C. The Parties and
the representatives of the beneficiaries of the MANALA MGIBE CPA have
conducted negotiations for the settlement
of the claims referred to
in paragraph B above, and wish to enter into this Agreement for the
settlement of the claims by way of
the sale of the Properties by the
Seller to the Purchaser and the registration of the transfer of the
Properties into the name
of the MANALA MGIBE CPA.’
[3] The undisputed evidence of the seller is that prior
to the conclusion of the sale agreement she had been informed by Mr
Takalani
Sidakalala, who was the responsible official representing
the purchaser, that the properties would be expropriated if she did
not
agree to sell them. He also informed her that she could not
appoint her own attorney for purposes of the transfer of the
properties
and that the parties must make use of the attorney
appointed by the government. The purchaser appointed Sechele Inc,
Pretoria as
the conveyancer. Mr NK Sechele was the sole director of
that company. The seller signed the deed of sale at the offices of
the
conveyancer. Clause 1.1.2 of the deed of sale defines “the
Conveyancers” as
‘
. . .
SECHELE Attorneys appointed by the Purchaser to register the transfer
of the Properties from the Seller to the MANALA MGIBE
CPA’.
[4] The other relevant provisions of the deed of sale
are clauses 4 and 7 which read as follows:
‘
4.
PAYMENT OF THE PURCHASE PRICE
The purchase price for the
Properties of R3 700 000.00 (Three Million Seven Hundred Thousand
Rand only) shall be payable by the
Purchaser to the Seller in cash as
follows:
4.1 Within 30 (thirty) calendar
days of the Signature Date, the Purchaser shall pay the deposit being
50% (fifty percent) of the
purchase price into the Conveyancers’
Trust Account.
4.2 Within 14 (fourteen) days
of written request by the Conveyancers, which request shall only be
made when the documents required
for the transfer of the Properties
are ready to be lodged with the Mpumalanga Province Deeds Registry,
the Purchaser shall furnish
to the Conveyancers a written undertaking
from the Chief Land Claims Commissioner in the form of an undertaking
to pay the balance
of the purchase price, into the Conveyancers’
Trust Account within 5 (five) working days of registration of
transfer of the
Properties into the name of the MANALAMGIBE CPA [sic]
in the Mpumalanga Province Deeds Office.
4.3 The amount deposited by the
Purchaser with the Conveyancers in terms of clause 4.1, shall pending
the registration of transfer
of the Properties be invested by the
Conveyancers in an interest bearing account in terms of Section
78(2A) of the Attorneys Act
53 of 1979, as amended, and such accrued
interest shall, upon registration, be paid over to the Purchaser,
less bank charges into
the following bank account . . .
4.4 The portion of the purchase
price referred to in clause 4.1 shall be paid to the Seller by the
Conveyancers against registration
of transfer of the Properties into
the name of the MANALAMGIBE [sic] in the Mpumalanga Province Deeds
Office. The Portion of the
purchase price referred to in clause 4.1
shall be paid to the Seller by the Conveyancers forthwith after
receipt from the Seller.
4.4 Within 14 fourteen days
[sic] of written request by the Conveyancers from the Chief Land
Claims Commissioner, which request
shall only be made when the
documents required for the transfer of the Properties to be lodged
for registration, the Purchaser
shall conduct an inspection of the
properties to confirm that the property is in the same condition as
at date of valuation.
4.5 Upon completion of the in
loco inspection, the Purchaser will instruct the Conveyancer to lodge
registration papers at the Deeds
Office, provided it is confirmed by
the Purchaser that the Property is in the same condition as at the
date of valuation.
4.6 Should the Purchaser raise
issues after the in loco inspection, the Conveyancer will be informed
of outstanding issues to be
addressed and lodgment of the
registration papers will only take place on confirmation by the
Purchaser that the issues have been
resolved. In the event that the
parties do not agree to the valuation adjustment to be implemented
within 10 (ten) working days
following the in loco inspection this
Agreement shall be deemed to be cancelled with immediate effect.
. . .
7. INTEREST ON AMOUNTS DUE
Should any part of the purchase
price of the Property not be paid to Seller on the date on which it
is due in terms of this Agreement,
the Purchaser shall be liable for
payment of interest to the Seller on such amount at the rate
published in terms of the Act on
Prescribed Interest Rates, Act 55 of
1975 which will be calculated on a daily basis and capitalized
monthly. The interest is payable
on demand.’
[5] The Land Claims Commissioner furnished the written
undertaking envisaged in clause 4.2 on 9 October 2008. The deposit of
R1
850 000.00 was paid into the conveyancer’s trust account the
following day. Transfer of the properties into the name of the

beneficiary was done and executed at the office of the Registrar of
Deeds at Pretoria on 22 May 2009. The conveyancer only paid
an amount
of R650 000.00 to the seller on the day of the registration of
transfer.
[6] The seller objected to Mr Sidakalala about this. He
consequently arranged a meeting with the conveyancer. It was held at
the
beginning of June 2009 and attended by the three of them. The
seller could not follow the conversation between Mr Sidakalala and

the conveyancer because she did not understand the language. But Mr
Sidakalala informed her that he had given the conveyancer ten
days to
pay the money over to her. She informed him that she was not going to
move from the properties until she received all her
money. Mr
Sidakalala agreed to this saying that he would negotiate with the
beneficiary. It is to be noted that in terms of clause
9.1 of the
deed of sale all the benefits of ownership of the properties are to
pass to the beneficiary, ‘subject to full
payment,’ on
the date of registration of transfer of the properties into the name
of the beneficiary.
[7] The balance of the purchase price in the sum of R1
850 000.00 was paid into the conveyancer’s trust account on 8
June
2009. The conveyancer paid this amount to the seller the
following day. On the same day the conveyancer also paid the sum of
R178
028.80 to Nedbank on behalf of the seller, whose indebtedness to
the bank was secured by a mortgage bond that was registered over
one
of the properties.
[8] The sum of R1 021 971.20 that was already due and
payable to the seller against registration of transfer remained
unpaid. She
again complained to Mr Sidakalala that the conveyancer
had failed to pay the outstanding amount to her despite the expiry of
the
ten day period given to him by Mr Sidakalala. A second meeting
with the conveyancer was arranged by Mr Sidakalala. The conveyancer

admitted at this meeting that he had misappropriated the unpaid
money. The ineluctable inference in all the circumstances is that
the
money was misappropriated by him before registration of transfer of
the properties into the name of the beneficiary and, accordingly,

before it was due to the seller in terms of the deed of sale. The
only further payment that was made to the seller was an amount
of R20
000.00, which the conveyancer paid to her on 19 August 2009.
[9] The seller’s combined summons cites the
purchaser as the first defendant and the Deputy Director: Finance in
the Chief
Land Claims Commissioner’s office as the second
defendant. It is recorded in clause 17.4 of the deed of sale that the
Deputy
Director: Finance in the Chief Land Claims Commissioner’s
office shall be responsible for any payment to be made by the
purchaser.
No relief is claimed against the second defendant. Sechele
Inc and Mr NK Sechele are cited as the third and fourth defendants.
[10] The seller pleaded the sale agreement, her full
performance, the purchaser’s breach in only paying to her via
the conveyancers
the amounts to which I have already made reference,
and she claimed payment of the unpaid balance of the purchase price
(the sum
of R1 001 971.50) plus interest thereon and costs from the
purchaser. She further pleaded that the conveyancer was jointly and
severally liable to her with the purchaser in the event of the
purchaser having paid the full purchase price to the conveyancer.
The
purchaser pleaded that its ‘…obligations in terms of the
contract was [sic] fulfilled due to the fact that payment
was made to
[sic] the conveyancer’s trust account in the amounts of R1 850
000.00 on 10 October 2008 and R1 850 000.00 on
8 June 2009
respectively’ and that the seller must take her recourse in law
against the conveyancer alone.
[11] The seller elected not to proceed with her action
against Sechele Inc and Mr NK Sechele after being advised that she
had no
claim in law against them. The finding of the court
a
quo was to the effect that the terms of the deed of sale
did not confer authority on the conveyancer to represent the seller
in
the acceptance of the purchase price. Hiemstra AJ referred to
clauses 1.1.2., 4.3, 17.1 and 17.3 of the deed of sale and concluded:
‘
These
clauses, and in particular clause 4.3, according to which the
purchaser is entitled to interest earned on the money invested
by the
conveyancers, tilt the scales firmly in favour of the proposition
that the conveyancers acted as the agents of the purchaser
and not of
the seller. That being the case, the money had not been paid to the
plaintiff or to her agent.’
The purchaser and the Deputy Director: Finance in the
Chief Land Claims Commissioner’s office (second appellant) were
ordered,
jointly and severally, to pay the unpaid balance of the
purchase price, interest thereon and costs to the seller. Hiemstra AJ
obviously
erred in also granting judgment against the second
appellant.
[12] Before us, counsel for the purchaser submitted that
the question to be decided by the court a quo, as formulated in the
pleadings,
was not whether the conveyancer, in whose hands the money
was misappropriated, had acted as agent of the purchaser or of the
seller
or of both of them in receiving and holding the purchase
consideration, but instead whether the purchaser had complied with
the
agreement between the purchaser and the seller as to how the
purchase price was to be paid. The issue in counsel’s
submission
was only one of performance and no question of agency
arose. Counsel for the purchaser placed great reliance upon the
decision
in
Verbeek v Maher
2
in which case Milne J said the following:
3
‘
It
seems to me, however, that, assuming that P.N.B. Properties in
receiving the money was not acting as the agent of the seller

(because if it was, the appeal must succeed), it nevertheless does
not matter whether P.N.B. Properties is correctly regarded as
adjectus
solutionis gratia
or
as a stakeholder or as some other third party who is a stranger to
the transaction since there is, in my view, an unequivocal
agreement
between the purchaser and seller as to how the R12 000.00 (which is
nearly half the purchase price) is to be paid.’
[13] It is common cause that the full purchase price was
duly lodged with the conveyancer in accordance with the terms the of
the
deed of sale. The submission of counsel for the purchaser,
however, loses sight of the question whether payment of the purchase

price to the conveyancer operated as discharge of the purchaser’s
obligation to pay the purchase price. In this regard I
agree with the
view expressed by Botha JA in
Baker v Probert
4
that he has
‘
. . .
difficulty in visualising a situation (save possibly for an
exceptional case) in which there could be due performance of the

obligation to pay the purchase price, by paying it to a third party,
unless that third party was appointed and authorised by the
seller to
accept the payment, thus constituting him his agent for the purpose.’
[14] Botha JA described the meaning of agency within
this context as follows:
5
‘
It
connotes a mandate by which the seller confers authority on the agent
(his mandatary) to represent him in the acceptance of the
payment of
the purchase price, with the consequence, in law, that payment to the
agent is equivalent to payment to the seller.’
[15] It is clear from the parties’ pre-trial
minute and the transcript of the proceedings in the court a quo that
the parties
and the presiding judge were alive to the central issue
in this case, viz whether the conveyancer was the agent of the seller
for
receiving payment of the purchase price from the purchaser. If he
was not, the purchaser’s defence of payment cannot succeed.
[16] Whether the conveyancer was the agent of the seller
for receiving payment of the purchase price from the purchaser in
this
instance depends solely on the terms of the deed of sale. The
conveyancer received and held the money paid over to him in terms
of
the sale although not as a party to the deed of sale. No other tacit
or express authorisation is relied upon. I am of the view,
on a
proper construction of the deed of sale, that the court a quo
correctly concluded that the conveyancer was not the agent of
the
seller in receiving payment of the purchase price.
6
[17] The purchaser’s obligation, on a plain
reading of the introductory part of clause 4, is to pay to the seller
the whole
purchase price in cash. The sub-clauses which follow and
the other relevant clauses must be construed in the light of this
overriding
obligation of the purchaser. Sub-clauses 4.1 – 4.4
provide for a mode of ensuring that payment will be made: 50 percent
of
the purchase price against registration of transfer and the
balance within five working days of registration of transfer, payable

only if the agreement is not ‘deemed cancelled’ in
accordance with the provisions of clauses 4.5 – 4.6.
[18] Clause 4.3 describes the purchaser’s mandate
to the conveyancer in respect of the deposit which it paid into the
conveyancer’s
trust account in terms of clause 4.1. The
conveyancer must invest the deposit in an interest bearing account in
terms of s 78(2A)
of the Attorneys Act 53 of 1979 and pay the accrued
interest over to the purchaser upon registration of transfer.
[19] Clause 4.4 describes the purchaser’s mandate
to the conveyancer relating to the method of payment to be followed.
Half
the purchase consideration becomes payable by the purchaser to
the seller against performance of the reciprocal obligation of the

seller to give transfer of the properties to the beneficiary and the
balance of the purchase price within five working days of

registration of transfer. The seller is not to receive any part of
the purchase price before registration of transfer. If any part
of
the purchase price is not paid to the seller on the date on which it
is due, the purchaser is liable to pay interest to the
seller on such
amount (in terms of clause 7).
[20] The seller’s right to receive payment is, in
terms of the provisions of clauses 4.5 – 4.7, not an
unconditional
one. The purchaser has the right to conduct an
inspection of the properties prior to registration of transfer to
confirm that the
properties are in the same condition as at the date
of valuation. Lodgment in the deeds office may not take place until
the issues
which the purchaser may raise after the inspection have
been resolved. The deed of sale ‘shall be deemed to be
cancelled
with immediate effect’ if the parties do not agree
‘to the valuation adjustment to be implemented’.
[21] I am accordingly of the view that the provisions of
the deed of sale do not establish an express or tacit authorisation
of
the conveyancer to receive payment of the purchase consideration,
or any portion thereof, on behalf of the seller. Payment thereof
to
the conveyancer was therefore not equivalent to payment to the seller
and did not operate to discharge the purchaser’s
obligation to
pay the purchase price to the seller.
[22] The result is:
1. The first appellant’s appeal is dismissed, with
costs.
2. The second appellant’s appeal is upheld, with
costs.
3. The order of the court a quo is set aside and there
is substituted an order which reads:
‘
The first defendant is ordered
to pay to the plaintiff:
The sum of R1 001 971.50;
Interest on the sum of R1 200 000.00 at the rate of
15,5% per annum from 22 May 2009 to 9 June 2009;
Interest on the sum of R1 850 000.00 at the rate of
15,5% per annum from 29 May 2009 to 9 June 2009;
Interest on the sum of R1 021 971.50 at the rate of
15,5% per annum from 9 June 2009 to 19 August 2009;
Interest on the sum of R1 001 971.50 at the rate of
15,5% per annum from 19 August 2009 until date of payment;
Costs of suit.’
P A MEYER
ACTING JUDGE OF APPEAL
MAJIEDT JA (NAVSA ADP concurring):
[23] I have read the judgment of my colleague Meyer AJA,
but I disagree with his conclusion and the reasoning upon which it is
premised.
Regrettably, I also disagree with his statement in para 15
that the parties were
ad idem
in the court below concerning
the central issue in the case, namely agency. More about that later.
[24] In my view, it is necessary at the outset to deal
with how the first respondent, Ms C de Klerk (de Klerk), pleaded her
case
and how the trial was conducted. It is also necessary to examine
the only basis postulated before us on de Klerk’s behalf
for a
finding in her favour. A full exposition of the facts is required
which regrettably entails some repetition.
[25] De Klerk had sold immovable property to the
National Department of Land Affairs (the Department) represented in
the present
litigation by the first appellant, the Minister of
Agriculture and Land Affairs (the Minister). The Department had
purchased the
land in order to settle a land claim brought by a
certain dispossessed community. A written deed of sale was signed by
the parties
which reflected their respective obligations. It is that
deed of sale which is the subject of the present appeal. As pointed
out
by my colleague, the conveyancer to whom the money was paid by
the Department in terms of the agreement, had misappropriated part
of
that payment and de Klerk’s response was to sue the Department,
the conveyancer and his legal firm. In her particulars
of claim de
Klerk stated that she had complied with all her obligations in terms
of the agreement and in this regard she was referring
to all the
steps she had to take to ensure registration in the name of the
community. Such registration had in fact taken place
on 22 May 2009.
The basis of de Klerk’s claim can be found in para 10 of her
particulars of claim:
‘
Eerste verweerder het kontrakbreuk gepleeg
deur slegs die onderstaande bedrae ter delging van die koopprys op
die onderstaande datums
aan eiser via derde verweerder te betaal,
latende ‘n uitstaande balans van R1 001 971.50:
10.1 R650 000.00 op 22 Mei 2009;
10.2 R178 028.50 op 9 Junie 2009;
10.3 R1 850 000.00 op 9 Junie 2009;
10.4 R20 000.00 op 19 Augustus 2009.’
Thus, in claiming the outstanding amount due plus
interest, de Klerk was undoubtedly claiming payment of the purchase
price on the
basis that the Department had not paid the moneys still
owing over to the conveyancer, who is the third defendant referred to
above.
[26] In his plea, the Minister responded,
inter
alia
, as follows:
‘
10.1 The first defendant’s
obligations in terms of the contract was fulfilled due to the fact
that payment was made to the
conveyancer’s trust account in the
amounts of R1 850 000 on 10 October 2008 and R1 850 000
on 8 June
2009 respectively. The defendants refer to annexure “A”
hereto, being the BAS report from the first defendant’s

accounting system, which substantiates same.
10.2 The defendants deny that the plaintiff only received in payment
the amounts specified in paragraphs 10.2 to 10.4 and that
any amounts
in capital and/or interest is outstanding and put plaintiff to the
proof thereof.
10.3 The first defendant pleads that to the extent that the third or
fourth defendant has neglected any [of] its or any of his
reciprocal
obligations towards the plaintiff, the plaintiff must take her
recourse in law against the third and fourth defendants
and against
them alone.’
[27] As things stood at the close of pleadings the only
issue between the parties was whether or not the Department had
complied
with its obligations in terms of the agreement by paying
over amounts to the conveyancer by the dates stipulated in the deed
of
sale.
[28] At a pre-trial conference it was indicated on de
Klerk’s behalf, for reasons best known to her and her legal
representatives,
that they had decided not to proceed with the claim
against the conveyancer and his legal firm.
[29] At the commencement of proceedings in the court
below, de Klerk’s legal representative reiterated the material
parts
of de Klerk’s particulars of claim referred to above. He
specifically referred to the Minister’s plea to the effect
that
payment to the conveyancer constituted payment to de Klerk. In
response, the Minister’s legal representative stated

emphatically that he stood by his plea:
’
MNR LIVERSAGE: . . . U Edele, ek stem saam
met die opening van my geleerde vriend in hierdie aangeleentheid.
Daar mag dalk net ‘n
kwessie ontstaan in verband met die
interpretasie van die Eiser oor wat die pleit werklik behels en of
dit een is van voldoening
aan die ooreenkoms en of dit een is van
betaling. Die Verweerder staan by die stukke soos wat dit gepleit is.
. . .’
[30] It was noted at the commencement of the proceedings
that the parties were agreed that the Department bore the onus of
proving
that the payments had been made. This is understandable as
that appears to have been the only issue between them.
[31] It is difficult to see why any witnesses testified
in the court below, more particularly Mr Rudlof, the conveyancer who
was
called by the first appellant. As stated above, the only question
to be resolved by way of evidence was whether or not payment had
in
fact been made to the conveyancer by the Department. That evidence
was in the affirmative. All the amounts required to be paid
in terms
of the deed of sale by the Department had in fact been deposited with
the conveyancer. The question of when the money
had been
misappropriated and whether it has any impact on the case is an
aspect to which I will return in due course. The only
time agency was
raised as an issue was when de Klerk testified under cross
examination that she had not appointed the conveyancer
as her agent.
[32] In his judgment in the court below, Hiemstra AJ
recorded what the Minister’s plea contained, as noted above,
and further
that it was contended by the Minister that de Klerk’s
recourse was against the conveyancer and/or his firm. Hiemstra AJ
then
went on to state that de Klerk’s legal representative had
argued that the conveyancer and his firm were not the agents of
de
Klerk but rather of the Department, and that consequently payment to
the conveyancer did not discharge the Department’s
obligation.
De Klerk’s counsel further conceded that conversely, if the
conveyancer and his firm were de Klerk’s agents
then payment to
them would have discharged the Department’s obligations.
[33] In the view of the court below, clause 4.3 was the
operative clause which ‘[tilts] the scales firmly in favour of
the
proposition that the conveyancers acted as the agents of the
[Department] and not of [de Klerk]. That being the case, the money

had not been paid to [de Klerk] or to her agent’. In reaching
this conclusion the court below had regard, inter alia, to
the
decision of this court in
Baker v Probert
.
7
[34] It is important to note that before us, counsel for
de Klerk relied
solely
on
the provisions of clause 4.3 for his contention that in terms of the
agreement the conveyancer was the Department’s agent.
The
reasoning was that, by holding the money in an interest bearing
account, with the interest accruing to the Department, the
conclusion
was compelling that in so holding the money the conveyancer and his
firm had acted as the Department’s agent.
This argument found
favour with the court below, wrongly so, as I will demonstrate in due
course.
[35]
Baker v Probert supra
was relied on by Hiemstra AJ, by both parties’
counsel as support for their differing contentions before us and by
my colleague
Meyer AJA.
Significantly in
Baker
v Probert
the plaintiff’s (the
purchaser) claim was formulated on the basis that she had paid the
purchase price of R17 500.00
to an estate agency, the duly
appointed agents of the defendant. In his plea in that case the
defendant denied that the estate
agency was his duly authorised agent
for the purpose of receiving or holding the purchase price. Thus,
agency was specifically
pleaded and was the only issue between the
parties.
[36] It is now necessary to briefly examine the facts of
that case which are set out in this and the next two paragraphs. The
defendant
(the seller) wished to sell a shareblock in a company and
gave a mandate to find a purchaser to a firm of estate agents, York
Estate
and Investment Co (Pty) Ltd (York Estate). York Estate found a
purchaser in the form of the plaintiff who signed an offer to
purchase,
which was in the form of a standard contract used by York
Estate. The contract expressly recorded that York Estate is acting as

agent for the seller. Clauses in the contract provided that the total
purchase price to be paid by the purchaser was in the amount
of
R17 500.00, which was to be paid by way of a deposit, an
instalment and a final payment. The crucial clause in the agreement

was clause 3 which provided as follows:
‘
All payments made in terms of this
paragraph shall be made to the agents to be held by them in trust for
payment to the sellers
on the effective date provided that the
sellers have complied with the provisions of para 5 hereof.’
The material part of clause 5 read as follows:
‘
The sellers shall forthwith deliver to the
agents, to be held in trust by them
the share certificates in respect of the shareblocks, together with
a duly completed share transfer form;
. . . .’
[37] The plaintiff paid the purchase price of R17 500.00
to York Estate. The defendant, however, did not deliver the share
certificates, either before the effective date or thereafter and
remained in default over a protracted period. Finally, the plaintiff

validly cancelled the contract on the grounds of the defendant’s
breach. Shortly thereafter York Estate was placed in liquidation.
The
plaintiff proved a claim for repayment for the purchase price but
received no dividend; consequently she proceeded with a claim
against
the defendant. This court considered the crucial issue to be the one
pleaded, namely whether or not York Estate was the
agent of the
defendant for receiving payment of the purchase price from the
plaintiff. The parties were agreed that that issue
was conclusive.
[38] The starting point in respect of the enquiry in
Baker’s
case was scrutiny of the deed of sale. The
heading of that contract stated that York Estate was acting as agent
for the defendant.
Even then, this court found that description on
its own inconclusive, reasoning that it might have meant no more than
that York
Estate acted for the seller in procuring the sale. However,
clause 3 quoted above, specifically recorded that York Estate was the

defendant’s agent for receiving payment of the purchase price.
This court went on to reason that York Estate received the
payment of
the purchase price with knowledge of the provisions of clause 3 and
prima facie
accepted the mandate from the defendant to do so
as his agent. Thus York Estate was obliged to pay over the money to
the defendant
after he had complied with his own obligation to
deliver the share certificates in terms of clause 5. Moreover the
parties clearly
intended that payment by the plaintiff to York Estate
would operate as a complete discharge of her obligation under the
contract,
thus equating payment to York Estate with payment to the
defendant. It was on that basis that this court allowed the
plaintiff’s
claim against the defendant.
[39] It is trite that parties are bound by their
pleadings – the object thereof being to delineate the issues to
enable the
other party to know what case has to be met.
8
It is impermissible to plead one particular issue and to
then seek to pursue another at the trial.
9
Agency, either express or implied, should be
specifically pleaded and, in accordance with the general rule that he
who asserts must
prove, the onus of proof rests on the party who
alleges such agency. In the present instance had De Klerk pleaded
agency, she bore
the onus of proving that the conveyancer acted as
the purchaser’s agent.
10
Even though in the present matter the question of agency
was not specifically pleaded, nor was the trial conducted on the
basis
of agency, I nevertheless now turn, as was done in
Baker
v Probert
, to examine the material provisions
of the deed of sale to determine whether the conclusion reached by my
brother Meyer AJA is
justified. For ease of reference, I repeat some
of the provisions already noted by my colleague. In addition to the
preamble quoted
by Meyer AJA in paras 2, 3 and 4 above, clauses 2 and
3 of the deed of sale are important:
’
2. SALE
The Seller hereby sells to the Purchaser who hereby purchases the
following properties with the Proposed Subdivisions which are

included in this sale:
2.1. Portions 49 and 50 of the farm Leeupoort 283 JS, in extent
8.5653 and 9.3414 ha respectively.
3. PURCHASE PRICE
The purchase price for the Properties shall be
R3 700 000.00
(Three Million Seven Hundred Thousand Rand only).
’
[40] The preamble and the above clauses in my view
clearly indicate that the parties were dealing with each other at
arm’s
length and as equals. The evidence by de Klerk referred
to by Meyer AJA concerning a threatened expropriation compelling her
to
conclude the deed of sale does not detract from this.
Duress
was never an issue during the trial. Moreover,
expropriation has to follow a prescribed statutory procedure within
the relevant
constitutional strictures and provides for objections
and fair compensation. In any event, the following part of de Klerk’s

evidence, under cross-examination is illuminating:
‘
Mevrou, as ‘n mens kyk na hierdie
koopkontrak en ek wil u aandag vestig op in besonder het u hierdie
ooreenkoms voordat u
dit geteken het verwys na ‘n prokureur of
het u verstaan wat hier geskryf word? --- Ek het dit verstaan.
Het u alles daarvan verstaan? --- Ja.
Is u seker oor daardie antwoord van u? --- Ek het dit verstaan.’
It is thus to the terms of the agreement that we must
look and my colleague’s reliance on threatened expropriation in
support
of a conclusion in her favour is, with respect, misplaced.
Evidence
aliunde
in
the interpretation of contracts is permitted in limited circumstances
only as set out in
Coopers & Lybrand v
Bryant.
11
This is usually resorted to when there is ambiguity. No
such ambiguity was advanced by either of the parties. One must
ascertain
whether the terms of the contract are such that they lead
to the ineluctable conclusion that throughout the conveyancer was the

Department’s agent, as found by my colleague.
[41] It is so that clause 1.1.2 of the deed of sale
records that the ‘conveyancers’ refers to the
‘[a]ttorneys
appointed by the Purchaser to register the
transfer of the Properties from the Seller to the MANALA MGIBE CPA’.
However,
the appointment of a conveyancer favoured by one of the
parties to complete the registration is not, on its own, an indicator
of
agency.
[42] Clause 4.1 of the deed of sale requires that within
30 days of the date of signature, the purchaser shall pay a 50 per
cent
deposit into the conveyancer’s trust account. Clause 4.2
requires that when documents required for the transfer of the
properties
are ready to be lodged at the deeds registry, the
purchaser shall, within 14 days of written request from the
conveyancer, furnish
a written undertaking from the Chief Land Claims
Commissioner to pay the balance of the purchase price into the
conveyancer’s
trust account within five working days after
registration of transfer. Clause 4.3, which it will be recalled was
the principal
basis on which the court below ruled in de Klerk’s
favour and was the only basis advanced before us on her behalf,
stipulates
that amounts deposited by the purchaser shall be invested
by the conveyancer in an interest bearing account for the purchaser’s

benefit. This is no more than a standard provision in contracts of
sale of immovable property. The obligation to pay the full amount
of
the purchase price in the present case and in the normal course of
events only arises upon registration. Notionally it is to
ensure that
payment and registration occur
pari passu.
[43] Importantly, clause 4.4, which bears repeating,
provides:
‘
The portion of the purchase price referred
to in clause 4.1
shall
be paid to the Seller
by the
Conveyancers
against registration of
transfer of the Properties into the name of the MANALAMGIBE in the
Mpumalanga Province Deeds Office. The
Portion of the purchase price
referred to in clause 4.1 shall be paid to the Seller by the
Conveyancers forthwith after receipt
from the Seller.’ (My
emphasis)
[44] Although the conveyancer was not a signatory to the
deed of sale, he and his firm undertook to perform the obligations
imposed
thereby.
12
I agree with the view expressed by Magid J in
Basson
v Remini
13
that a conveyancer who accepts an appointment by a
seller and a purchaser becomes the agent of both parties. It is clear
from the
provisions referred to earlier in the context of the
totality of the agreement that once the seller had met all her
obligations
the conveyancer was obliged to pay over all the amounts
due to her. It is common cause that she had complied with all her
obligations.
[45] To sum up, there is no single provision nor do the
provisions of the deed of sale collectively indicate a mandate by the
Department
to the conveyancer to act solely as its agent to receive
and hold the money only on its behalf. Whilst there might be an
argument
that up until the seller complies with her obligation in
terms of the deed of sale the conveyancer’s creditor will be
the
Department, there can be no doubt in terms of the clear wording
of the conditions of the deed of sale referred to in para 21 above

that the conveyancer is obliged after date of registration to pay the
moneys to the seller, namely de Klerk. The passage from
Baker
v Probert,
quoted by Meyer AJA in para 13
above, is not only
obiter
but
in any event finds no application in the factual matrix of the
present case. More particularly, as shown above, once the
registration
had been completed, de Klerk was entitled to the money
and at that stage in accordance with the deed of sale the money could
only
have been held on her behalf. That was the conveyancer’s
mandate by both parties and he thus bore the expressly stipulated

obligation to pay the money over to de Klerk.
[46] My colleague concludes that it is an unavoidable
inference from all the circumstances that the moneys paid by the
Department
were misappropriated before the seller had complied with
her obligations. I disagree. It is common cause that registration of
transfer
took place on 22 May 2009. On de Klerk’s evidence, the
first meeting to discuss payment of the outstanding amounts took
place
during the first week of June 2009. As pointed out in para 3
above, subsequent to registration de Klerk received amounts of
R650 000.00
on 22 May 2009, R178 028.50 on 9 June 2009 and
another payment of R1 850 000.00 on the same date. She
received a
further payment of R20 000.00 on 19 August 2009,
leaving a balance of R1 001 971.50 which was the amount she
claimed
in her summons. According to de Klerk’s testimony, she
was informed after 9 June 2009, having received three of the amounts

referred to above, that the money had been misappropriated. I fail to
see how in these circumstances the compelling conclusion
is that the
moneys were misappropriated before the seller had complied with her
obligation to pass transfer. If anything, all the
indications are
overwhelmingly to the contrary. In order to succeed with her claim de
Klerk would have had, at the very least,
to overcome the hurdle of
proving that the money was misappropriated before registration, which
she failed to do. De Klerk ought
to have looked to the conveyancer
and his firm for payment of the moneys due to her in terms of the
deed of sale. In the light
of the obligation undertaken by the
conveyancer to pay over the money to de Klerk upon registration of
transfer, I am unable to
see what defence the conveyancer could
possibly have had to a claim by de Klerk. She would also have had a
claim against the Attorneys
Fidelity Fund in terms of s 26
(a)
of the Attorneys Act 53 of 1979, on the basis of theft
of moneys rightfully due to her. For all these reasons I would uphold
the
appeal with costs and substitute the order of the court below
with the following:
‘
1.
The plaintiff’s claim is dismissed with costs’.
__________________________
S A MAJIEDT
JUDGE OF APPEAL
APPEARANCES:
For 1st & 2nd Appellants: A Liversage
Instructed by:
The State Attorney
Pretoria
The State Attorney
Bloemfontein
For 1st Respondent: GF Heyns
Instructed by:
Van Dyk & Theron
Pretoria
Rossouw Attorneys
Bloemfontein
For 2nd & 3rd Respondents: No appearance
1
Communal
Property Association.
2
Verbeek
v Maher
1978 (1) SA 61
(NPD).
3
At
68D-E.
4
Baker
v Probert
1985 (3) SA 429
(AD) at 440A – C.
5
At
439D.
6
Compare:
Van Vliet v Adler, Kessly and Salomon
1979 (3) SA 1156
(WLD)
at 1160E – 1161E;
Holder v Rovian Trust (Estate) (Pty) Ltd
1975 (3) SA 895
(N) at 899F-H.
7
Baker
v Probert
1985 (3) SA 429
(A).
8
Gusha
v Road Accident Fund
2012 (2) SA 371
(SCA) para 7.
9
Imprefed
(Pty) Ltd v National Transport Commission
1993
(3) SA 94
(A) at 107G-H.
10
A
J Kerr,
The Law of Agency
3
rd
ed (1991) at 74-75, and cases cited there.
11
Coopers
& Lybrand v Bryant
[1995] ZASCA 64
;
1995 (3) SA 761
(A) at 767E-768E.
12
See
Baker v Probert op cit
at
445G-I and
Baker v Afrikaanse Nasionale
Afslaers en Agentskap Maatskappy
(Edms)
Bpk
1951 (3) SA 371
(A) 375G-376A.
13
Basson
v Remini
1992 (2) SA 322
(N) at 328A.