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[2012] ZASCA 197
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Transnet Ltd v Tebeka and Others (35/12) [2012] ZASCA 197 (30 November 2012)
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THE
SUPREME COURT OF APPEAL OF SOUTH AFRICA
JUDGMENT
Case No: 35/12
Reportable
In the matter between:
Transnet Limited
................................................................................
First
Appellant
and
Tatise Jackson Tebeka
.................................................................
First
Respondent
Nelson Mandela Bay Metropolitan
Municipality
....................
Second
Respondent
Evelyn Tebeka
..............................................................................
Third
Respondent
Neutral citation:
Transnet
Limited v Tatise Tebeka & others
(35/12)
[2012] ZASCA 197(30
November 2012)
Coram:
MTHIYANE DP, SHONGWE JA,
SOUTHWOOD, PLASKET AND MBHA AJJA
Heard:
22 November 2012
Delivered: 30 November 2012
Summary:
Prevention of Illegal Eviction from
and Unlawful Occupation of Land Act
19 of 1998 (PIE) – whether
first and third respondents unlawful occupiers of
house – house occupied in
terms of agreement of sale between appellant
and first respondent – first
respondent in default – appellant failed to
establish that notice of rescission
communicated to him – agreement not
cancelled – first and third
respondents not unlawful occupiers.
________________________________________________________________
ORDER
________________________________________________________________
On appeal from:
Eastern Cape
High Court, Port Elizabeth (Tshiki J sitting as court of first
instance):
The appeal is dismissed with costs.
________________________________________________________________
JUDGMENT
________________________________________________________________
PLASKET AJA (MTHIYANE DP, SHONGWE
JA, SOUTHWOOD and MBHA AJJA concurring)
[1] Applications
for the eviction of people from their homes in terms of the
Prevention of Illegal Eviction from and Unlawful Occupation
of Land
Act 19 of 1998 (PIE) invariably raise a two-way tension between the
interests of landowners and those in occupation of
property and under
threat of eviction.
1
[2] These tensions certainly arise in
this appeal from the Eastern Cape High Court, Port Elizabeth (Tshiki
J) in which the application
of the appellant (Transnet) for an order,
in terms of PIE, for the eviction of the first and third respondents
(Mr and Mrs Tebeka)
from a house owned by Transnet was dismissed with
costs. The second respondent, the Nelson Mandela Bay Metropolitan
Municipality,
did not oppose the application, filed no papers and
took no part in the proceedings. The appeal is before this court with
the leave
of Tshiki J.
[3] The court below dismissed the
application because it found that it had not been established that Mr
and Mrs Tebeka were unlawful
occupiers for purposes of PIE, having
decided what it identified as a dispute of fact as to whether Mr
Tebeka had paid for the
house in his favour. Secondly, it held that,
even if it was wrong in this respect, it would not, in the
circumstances, be just
and equitable to evict the Tebekas.
The legal context
[4] The interests of property owners
and those under threat of eviction are both catered for in the
Constitution. Section 25(1)
of the Constitution provides that ‘[n]o
one may be deprived of property except in terms of law of general
application, and
no law may permit arbitrary deprivation of
property’, while s 26(3) states that ‘[n]o one may be
evicted from their
home, or have their home demolished, without an
order of court made after considering all relevant circumstances’
and that
‘[n]o legislation may permit arbitrary evictions’.
[5] In its preamble PIE refers to both
of these provisions before stating that it ‘is desirable that
the law should regulate
the eviction of unlawful occupiers from land
in a fair manner, while recognising the right of land owners to apply
to a court for
an eviction order in appropriate circumstances’.
[6] Section 4 of
PIE is central to why, how and when persons may be evicted from land
on which they live. Section 4(1) provides,
in the first place, that,
generally speaking, the section applies
‘
to
proceedings by an owner or person in charge of land for the eviction
of an unlawful occupier’. Sections 4(2) to 4(5) prescribe
procedures for the initiation of an application for eviction and ss
4(6) and (7) provide for the way in which courts are to consider
the
merits of applications to evict persons who have been in occupation
of land for less than six months and more than six months
respectively.
[7] This case concerns occupiers who
have been in occupation for longer than six months. Section 4(7)
states that ‘a court
may grant an order for eviction if it is
of the opinion that it is just and equitable to do so, after
considering all the relevant
circumstances, including . . . whether
land has been made available or can reasonably be made available by a
municipality or other
organ of state or another land owner for the
relocation of the unlawful occupier, and including the rights and
needs of the elderly,
children, disabled persons and households
headed by women’.
[8] In order for a
person to be liable to eviction, he or she must be an ‘unlawful
occupier’ of property. That term
is defined in s 1 to mean ‘a
person who occupies land without the express or tacit consent of the
owner or person in charge,
or without any other right in law to
occupy such land . . .’.
2
An owner is defined
as ‘the registered owner of land, including an organ of state’
and consent means ‘the express
or tacit consent, whether in
writing or otherwise, of the owner or person in charge to the
occupation by the occupier of the land
in question’. Although
this is not expressly stated in PIE, it only applies to evictions
from dwellings – the homes
of persons – and not to
evictions from land used for commercial purposes or for holiday
purposes.
3
The facts
[9] It is common cause that Transnet
is the registered owner of the house situated at 76 Cerus Street,
Motherwell, Port Elizabeth;
that this property is the home of Mr and
Mrs Tebeka, their unemployed son and daughter and her minor child;
and that the Tebekas
have resided in the home since July 1989 at
least. The proceedings to evict them were instituted in February
2010, after they had
lived in the home for over 20 years.
[10] Mr Tebeka had been an employee of
Transnet. In July 1989, as part of Transnet’s house ownership
scheme for its personnel,
it had acquired the property and had sold
it to him. The most important terms of the agreement of sale were
that: (a) the purchase
price would be R47 407.78; (b) Mr Tebeka’s
indebtedness to Transnet would be paid in equal monthly instalments
over a period
of 38 years; (c) ownership of the property would remain
vested in Transnet until Mr Tebeka had paid his indebtedness to it,
at
which point Transnet would issue him with a deed of grant; (d) the
monthly instalments would be paid to Transnet from Mr Tebeka’s
salary; and (e) in the event of Mr Tebeka leaving Transnet’s
employ, his pension being insufficient to settle the amount
outstanding and him failing to settle the balance on demand, Transnet
would be entitled to cancel the agreement.
[11] In December 1999, Mr Tebeka was
dismissed by Transnet and his pension was allocated to the settlement
of what was owed on his
home. This was insufficient to pay the full
amount outstanding. Despite this, Transnet appears not to have taken
any steps to enforce
its rights for close to a decade. Mr Tebeka paid
nothing to Transnet during this period.
[12] According to the deponent to the
founding affidavit, Mr Johan van der Spuy, Transnet’s manager:
collections, Transnet’s
attorneys wrote a letter dated 19
October 2009 to Mr Tebeka to inform him that he had not paid his
monthly instalments on the house
and that as a result, he was in
arrears in the amount of R95 635.44. The letter stated that he
was required to either settle
his indebtedness or make suitable
arrangements to do so and to communicate his intentions by 15
November 2009, failing which the
agreement of sale would be
cancelled.
[13] According to Mr van der Spuy, on
26 November 2009, the same attorneys sent a further letter to Mr
Tebeka in which they recorded
that they had received no reply to
their previous letter and informed him of the cancellation of the
agreement of sale. The letter
concluded as follows:
‘
As
a consequence of the cancellation effected herein, your continued
occupation has become unlawful and accordingly we hereby request
you
to vacate the premises by no later than
31
DECEMBER 2009
,
and to contact our offices in order to make adequate arrangements
with regards to the delivery of the keys. We confirm our instructions
to make an application for your eviction, should you fail to adhere
to our request herein.’
[14] Mr and Mrs
Tebeka denied having received either of these letters. The words ‘
PER
REGISTERED MAIL
’
appear
on the face of each letter but no registered mail slips were attached
to the papers to establish that they were indeed posted
and delivered
to the post office nearest the Tebekas’ home. No affidavit was
filed by the attorney who purportedly wrote
the letters to confirm
that he wrote them or that he attended to their postage by registered
mail. Mr van der Spuy’s assertions
that the attorney wrote them
and posted them is inadmissible hearsay. Furthermore, the issue was
not dealt with at all in reply,
which one would have expected, given
the Tebekas’ denial. In these circumstances, the Tebekas’
denial that they received
these letters must prevail in accordance
with the well-known rule in
Plascon-Evans
Paints Ltd v Van Riebeeck Paints (Pty) Ltd
.
4
[15] Mr Tebeka stated that he had
initially believed that his pension had paid his indebtedness on the
house in full. He later thought
he only owed R5 000, was under
the impression that a housing subsidy from the provincial government
had been obtained on his
behalf and that this amount had been
credited to his account to pay his debt in full. It appears from a
statement of account put
up by Transnet in reply to these
allegations, however, that nothing was paid into his account after
his pension was allocated to
it on 14 July 2000. At that stage a
balance of R23 974.21 remained. On 25 January 2008, the last
date reflected on the statement
of account, the balance is reflected
as being R40 373.42. (How that amount escalated to R95 635.44
by 1 October 2009
is not explained by Mr van der Spuy and, I venture
to suggest, probably cannot be explained.)
[16] Be that as it may, I am prepared
to accept for present purposes that Mr Tebeka was in arrears and that
the statement of account
reflected accurately what he owed on 25
January 2008.
The issue
[17] On the basis of the facts set out
above (including the assumption that I have made in favour of
Transnet that Mr Tebeka had
not paid in full for the house), I turn
now to the central issue in this matter, whether Transnet cancelled
the agreement of sale,
thus terminating any right in law that the
Tebekas had to occupy the house and thereby rendering them unlawful
occupiers for purposes
of PIE.
[18] How a creditor
may cancel a contract on the basis of a debtor’s
non-performance will depend on the terms of the contract
and, in some
cases, the nature of the obligation involved. A contract may contain
a forfeiture clause (or
lex
commissoria
)
– a clause to the effect that if a party fails to perform an
obligation by a set date, the other party may cancel, or a
provision
that requires performance of an obligation by a set date coupled with
a statement that time is of the essence. In either
event, the
contract may be cancelled forthwith when the date for performance has
passed and performance has not occurred. If a
contract contains no
such provisions, it may be inferred from the nature of the
transaction and the facts that time is of the essence,
and
cancellation may also be effected forthwith. This is, in truth, a
tacit forfeiture clause. Finally, where no express or tacit
forfeiture clause forms part of the contract and time is not of the
essence, an innocent party may make time of the essence. This
is done
by giving the party in default a notice of rescission – a
demand that if the non-performance is not remedied by a
specified
date, the contract will be cancelled.
5
[19] The position
in the last category of cases was set out thus by Wessels JA in
Breytenbach
v Van Wijk
:
6
‘
Immediate
performance having been impossible and not contemplated, and no date
for transfer having been fixed by the contract, the
respondent, if he
considered that sufficient time had elapsed to enable him, on that
ground, to procure his own release should
have taken steps – as
the civilians express it – to place the appellant in
mora
by
demanding that transfer should be passed on or before a specified
date, reasonable under the circumstances. . . Not having placed
the
appellant in mora the respondent was not entitled to sue for
cancellation of the contract merely because in his opinion transfer
was not effected within a reasonable time.’
[20] The issue was
analysed in detail, in two separate judgments of this court, in
Nel
v Cloete
.
7
In a minority
judgment ( in which he only differed from the majority on a factual
issue) Jansen JA made the point, with reference
to
Breytenbach’s
case,
that despite the use of the term
mora
in the passage
cited above, ‘is dit moeilik om die gevolgtrekking te vermy dat
die geleerde Regter hier basies die Engelse
“notice of
rescission” in gedagte het’.
8
[21] In the
majority judgment of Wessels JA, the following is stated concerning
the way in which a party may cancel a contract on
the basis of the
other party’s non-performance:
9
‘
Daar
bestaan, na my mening, geen rede waarom versoening tussen die twee
regstelsels bewerkstellig behoort te word deur die tydperk
vir
vervulling wat 'n “notice of rescission” in Engelse reg
beoog, eenvoudig by die tydperk, wat intrede van
mora
volgens
Romeins-Hollandsereg voorafgaan, aan te las nie. Waar dit, soos
hierbo aangedui is, volgens ons regspraak beoog is dat in
bepaalde
omstandighede die intreding van
mora
'n
bykomstige regsgevolg het, nl., die ontstaan van 'n terugtredingsreg,
indien 'n “notice of rescission” aan die skuldenaar
gerig
is, verval die praktiese noodsaaklikheid om op twee aparte
kennisgewings aan te dring. Wanneer 'n skuldeiser, soos hy geregtig
is om te doen, die skuldenaar aanmaan om op of voor 'n sekere dag te
voldoen, kan hy gerieflik in dieselfde kennisgewing meedeel
dat, by
gebreke aan voldoening binne die gestelde tydperk, hy hom die reg
voorbehou om uit die kontrak te tree. . . Dit kan, wat
die skuldenaar
betref, nie onbillikheid in die hand werk nie; hy word 'n redelike
geleentheid gegun om sy verpligting ooreenkomstig
die kontrak te
vervul. Dit kan nie gesê word dat 'n skuldeiser langs hierdie
weg deur eensydige optrede 'n
lex
commissoria
aan
die skuldenaar opdring nie. Waar 'n geskil ontstaan aangaande die
redelikheid, al dan nie, van die gestelde termyn, word dit
deur 'n
hof beoordeel na gelang van al die betrokke omstandighede. Slegs waar
'n skuldeiser redelik optree wat die kennisgewing
betref, kan
mora
intree,
en slegs dan kan 'n terugtredingsreg uitgeoefen word. By
koopkontrakte staan dit die partye vry, indien hulle verkies, om
te
beding dat prestasie nie voor 'n bepaalde dag geverg kan word nie.’
[22] The agreement of sale in this
case contains no express or tacit forfeiture clause and nor can it be
inferred from the nature
of the transaction and the facts that time
is of the essence. In order to place itself in a position to cancel
in due course on
account of Mr Tebeka’s failure to comply with
what was certainly a material term, therefore, Transnet had to make a
demand
of Mr Tebeka, calling on him to comply within a specified
period, reasonable in the circumstances, failing which the contract
would
be cancelled.
[23] As to the
purpose of the notice of rescission, Kotze JA, in
West
Rand Estates Ltd v New Zealand Insurance Co Ltd
,
10
said that ‘we must bear in mind that a defendant cannot be said
to be
in
mora
unless
he knows the nature of his duty or obligation; that is to say when
and how much he has to pay’.
From
th
is
,
it follows that
‘
it
is the receipt, not the dispatch, of the demand that matters’.
11
[24] Transnet has not established that
the notice of rescission that was allegedly written by its attorneys
was ever communicated
to Mr Tebeka. It was consequently not in a
position to cancel the agreement of sale, and consequently never did
so. That being
so, it has not been established that the Tebekas did
not have a right in law to occupy the house. They are not unlawful
occupiers
for purposes of PIE and are therefore not liable to be
evicted. The appeal must fail.
The order
[25] The following order
is made.
The appeal is dismissed
with costs.
__________________
C Plasket
Acting Judge of Appeal
APPEARANCES
:
For appellant: B Pretorius
Instructed by:
Greyvensteins, Port Elizabeth
Steyn Meyer Inc., Bloemfontein
For respondents: L Crouse
Instructed by:
Legal Aid, Port Elizabeth
Legal Aid, Bloemfontein
1
Port
Elizabeth Municipality v Peoples Dialogue on Land and Shelter &
others
2000
(2) SA 1074
(SE) at 1081D-E. See too Sandra Liebenberg
Socio-Economic
Rights
(2010)
at 271.
2
As
to this definition and the meaning of ‘consent’ see
Residents
of Joe Slovo Community, Western Cape v Thubelisha Homes & others
2010 (3) SA 454
(CC) paras 36-39 and 54-71.
3
Ndlovu
v Ngcobo; Bekker & another v Jika
2003
(1) SA 113
(SCA) para 20;
Barnett
& others v Minister of Land Affairs & others
2007 (6) SA 313
(SCA) paras 37-40.
4
Plascon-Evans
Paints Ltd v Van Riebeeck Paints (Pty) Ltd
[1984] ZASCA 51
;
1984
(3) SA 623
(A) at 634H-I.
5
Birkenruth
Estates (Pty) Ltd v Unitrans Motors (Pty) Ltd (formerly Malbak
Consumer Products (Pty) Ltd) & others
2005
(3) SA 54
(W) para 17; R H Christie and G B Bradfield
Christie’s
The Law of Contract in South Africa
6
ed (2011) at 527-530; Francois du Bois, Graham Bradfield, Chuma
Himonga, Dale Hutchinson, Karin Lehmann, Rochelle le Roux, Mohamed
Paleker, Anne Pope, C G van der Merwe and Daniel Visser
Wille’s
Principles of South African Law
9
ed (2007) at 860-861.
6
Breytenbach
v Van Wijk
1923
AD 541
at 549.
7
Nel
v Cloete
1972
(2) SA 150
(A).
8
At
172E-F.
9
At
163D-H.
10
West
Rand Estates Ltd v New Zealand Insurance Co Ltd
1926
AD 173
at 195.
11
Christie
and Bradfield (note 5) at 526.
Swart
v Vosloo
1965
(1) SA 100
(A) at 114H-115E.