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[2022] ZAKZPHC 42
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Mtuba Hardware CC v Gold Reward 120 CC t/a Remax Marine and Another (8145/2020P) [2022] ZAKZPHC 42 (1 September 2022)
SAFLII
Note:
Certain
personal/private details of parties or witnesses have been
redacted from this document in compliance with the law
and
SAFLII
Policy
IN THE HIGH COURT OF
SOUTH AFRICA
KWAZULU-NATAL
DIVISION, PIETERMARITZBURG
CASE NUMBER:
8145/2020P
In the matter between:
MTUBA HARDWARE
CC
APPLICANT
and
GOLD REWARD 120 CC t/a
REMAX MARINE
FIRST
CLAIMANT
TORNOSPACE (PTY) LTD
t/a HARCOURTS ZULULAND SECOND
CLAIMANT
JUDGMENT
BEZUIDENHOUT J:
[1]
Applicant was the owner of an immovable property described as erf
[....], [....] D[....]
Drive A[....] R[....] KwaZulu-Natal. The
said property was sold during 2019 and there is a dispute between
First and Second
Claimant as to who was the effective cause of the
sale and also entitled to the commission in the sum of R 529 000-00.
As
a result thereof Applicant filed an interpleader notice and claims
no interests in the dispute between Claimants. Second Applicant
sought condonation for the late filing of its heads of argument.
This was not opposed and condonation was granted.
[2]
One Cina Gertruida Van Der Vlies is the sole member of First Claimant
and carries
on business as an Estate Agent trading as Remax Marine
R[....]. She has been doing so since 11 August 2003 and was the
holder
of a valid fidelity fund certificate in terms of section 26(a)
of the Estate Agency Affairs Act 112 of 1976. One Johanna
Susanna Fourie (Fourie) is an intern estate agent in her employ from
6 April 2005 and was also the holder of a valid Fidelity Fund
Certificate for the years 2017 to 2020.
[3]
On 7 March 2017 the said Fourie introduced a lessee to Applicant.
The lease
was from 1 June 2017 to 31 August 2019. On 14 August
2019 one Steve Freeze (Freeze) of Applicant instructed Fourie
telephonically
to market the said property or secure an alternative
tenant. On 17 October 2019 one Wendy Huang contacted Fourie
with regards
to the said property and she contacted Freeze and the
purchaser viewed the property on 17 October 2019 with Fourie and Fist
Claimant.
On 18 October 2019 the purchaser telephonically
requested a second viewing of the property which was then done.
On 18 October
2019 an offer was made for the said property verbally
by the purchaser which was refused by Applicant. Various offers
pursued
and on 19 November 2019 at 10 a.m. an official site meeting
was arranged with a building inspector of the City of Umhlathuzi
Municipality
to clarify certain issues of the said property with
First Claimant and Applicant’s representative.
[4]
The sale agreement was thereafter prepared by First Claimant and sent
to the purchaser
on 27 November 2019 at 10:45 a.m. and the final
agreement was signed by the purchaser on 3 January 2020 and the
seller on 8 January
2020. The property was transferred on 30
October 2020. From annexure “B” to the affidavit of
First Claimant
it is apparent that on 18 October 2019 there was
certain email correspondence between her and the buyer.
[5]
From the further documents it is apparent that there was
correspondence between First
and Second Claimant in respect of who is
entitled to the commission in respect of the sale of the said
property.
[6]
Charmaine Redinger the managing director of Second Claimant sets out
in her particulars
of claim to the interpleader notice that Harcourts
is the holder of a fidelity fund certificate but that she has not
received a
copy thereof despite numerous requests to the Estate
Agency Affairs Board. She then refers to certain annexure in
this regard.
She contends that on 1 August 2019 Freeze of
Applicant contacted Harcourts to assist in obtaining a tenant for the
property and
an email is attached marked “D” stating the
information about the said property. The property was
inspected.
It was loaded on their system from 12 August 2019
and she refers to annexure “E” to indicate that it was
then on their
system. On 15 October 2019 Second Claimant
received a website enquiry in respect of the property and attached as
annexure
“J” is an enquiry by one Wendy with email
address and a price of R 98 000-00. On 16 October 2019 Jason
Redinger
(Jason) replied and stated that the property was still
available for lease. He also maintained that the owners would
consider
offers to purchase. On 16 October 2019 Wendy asked for
details so that she could check on Google Map.
[7]
It is then apparent from annexure “L” that on 16 October
2019 there was
certain communication between Wendy and Jason.
On 17 October 2019 Jason enquired whether she was still “alright”
for 10 that morning. The response was yes and Jason responded
how she could enter into the building. She then enquired
whether a certain area would be for their use because if it was not
it would not be suitable and Jason responded that he would
investigate. On 16 October 2019 an email was also sent to Steve
by Jason enquiring as to the price which they would require.
From the documents attached it appears that Jason was an intern
estate agent.
[8]
Supplementary particulars of claim were filed by Second Applicant
relating to the
fidelity fund certificate and stating that due to a
glitch in EEAB’s electronics system it could not be downloaded
and no
date for printing has been shown. An affidavit from one
Debra Lee Vial from the Estate Agency Board is attached stating that
a fidelity fund certificate was issued to them for the 2019 year.
She states that there was compliance in terms of section
26 of the
Estate Agency Affairs Act 112 of 1976. Redinger contends that
at all relevant times Harcourts possessed a fidelity
fund insurance
certificate in terms of the Act. Jason was the listing estate
agent in the employment of Second Claimant and
the effective cause of
the sale. The property was introduced to this purchaser on 17
October 2019.
[9]
The first affidavit of Debra Lee Vial was attested to on 24 January
2022 and is attached
to Second Claimants amended particulars of
claim. Therein she states that Charmaine Redinger was since
2007 up to the current
year registered, under the firm Tornospace CC
paid for the issue of an FFC for the 2019 year under the firm
Tornospace as required
by the Act. Due to a glitch on the
system this was never available for downloading by the agent.
This is an error in
the functioning of the system in this regard.
She states at paragraph 6 “I confirm that the agent was at all
material
times in compliance with requirement for a 2019 FFC to be
issued to her and is entitled to such 2019 FFC.”
[10]
On 18 July 2022 First Claimant issued a notice of motion seeking
leave to file supplementary
particulars of claim and to bear the
costs of the application save if it is opposed. No notice to
oppose this application
was filed by Second Claimant. In the
affidavit it states that the information was only obtained on 23 June
2022 and therefore
the late filing thereof and the reason for seeking
condonation. Attached thereto and dated 22 June 2022 is an
email from
the said Debra Vial stating the following:
“
I
confirm the Tornospace was not issued with an FFC for 2019 due to the
failure to submit audit reports by 30 June 2019 as required
by
section 32 of the EAA Act 112/1976. They were accordingly
disqualified under section 32(a)(A). They were already
disqualified due to the failure to submit an audit report for 2018 by
the same date. The audit reports were only submitted
on 20
December 2018 and 3 October 2019 respectively. The mere
submission of an audit report after the due date does not remove
the
disqualification but the section 27 process must be followed and the
fine paid before the agent becomes entitled to an FFC,
and then only
from the date the firm became compliant. No FFC may ever be
issued retrospectively when an agent is not entitled
to an FFC at the
time. They were prohibited from trading or charging any
commission or remuneration for any estate agent
activities during the
period that they were not issued with an FFC being 11/2/19 to
10/3/2020 when the 2020 FFC was issued after
the firm became
compliant and the fine was paid on 20 February 2020. The
renewal fee was paid on 10 March 2020 and the FFC
issued. Since
its firm and principal were not issued with FFC for the period none
of its employees or agents could have obtained
an FFC or received any
remuneration or commission.
Accordingly neither the
firm nor the principal nor any of the employees were entitled to any
commission or remuneration for estate
agent activities performed
during the period. (Section 34(A) Act 112/1976) Charmaine Redinger
requested her FFC on 29 January 2019
but it was not issued due to
none compliance status of the firm. If you require an affidavit
regarding this information kindly
request same and I will advise of
the costs involved. Should you wish a witness to attend the
trial to give evidence in this
matter kindly issue a subpoena duces
tecum for the date of trial and we will comply on the usual basis.”
[11]
There is also another affidavit attached by the said Debra Vial which
was attested to on 22 July
2022 wherein she
inter alia
states
the following:
“
I
have read the supplementary particulars of claim deposed to by Cina
Gertruida Van Der Vlies, the sole member and owner of the
applicant/first claimant and I confirm the contents thereof insofar
as it relates to me, as being true and correct.
I specifically confirm
the content of the supplementary particulars of claim insofar as it
relates to the second claimant in the
interpleader application
lacking any
bona fide
claim to commission as set out in the
interpleader proceedings.”
At the commencement of
the hearing First Claimant sought condonation for the late filing of
the supplementary affidavit and particulars
of claim to which I have
referred to above. It was submitted that it was set out in the
affidavit why it was late.
[12]
As set out above there was no notice to oppose filed. It was
submitted on behalf of Second
Claimant that it was not in terms of
Rule 6(5) as Second Claimant should have at least had five days to
file a notice to oppose
and thereafter 15 days for filing an opposing
affidavit.
[13]
That was the only basis upon which Second Claimant opposed the said
condonation and particulars
of claim. Firstly Rule 6(5) which
is also known as the long form is not required in this instance as it
is an interlocutory
application seeking condonation to amend or file
further particulars of claim to the interpleader. This was
pointed out to
Mr. Scheepers on behalf of Second Claimant who did not
take the matter any further. First Claimant was accordingly
granted
condonation for the late filing of the amended particulars of
claim as it is apparent from what is contained in the affidavit and
therein that it was highly relevant to the issue before Court and
also that there was sufficient reason provided why it was done
at
that stage. Second Claimant also did not seek any adjournment
as a result thereof nor that it suffered any prejudice.
[14]
Section 26 of the Estate Agency Affairs Act 112 of 1976 states as
follows:
“
No
person shall perform any act as an estate agent unless a valid
fidelity fund certificate has been issued to him or her and to
every
person employed by him or her as an estate agent and if such person
is (a) a company to every director of that company; (b)
a close
corporation to every member referred to in paragraph (b) of the
definition estate agent of that corporation.”
[15]
Section 34(A)(1) stipulates that: “No estate agent shall be
entitled to any remuneration
or other payment in respect of or
arising from the performance of any act referred to in subparagraph
(1), (ii), (iii) or (iv)
of paragraph (a) of the definition of estate
agent unless at the time of the performance of the act a valid
fidelity fund certificate
has been issued to such an agent.”
Section 16 prescribes the period and the manner in which an
application for a fidelity
fund certificate should be made.
Section 16(3) indicates that such certificate will be valid from when
it is issued until
31 December of the year to which it relates.
[16]
It is accordingly apparent that whoever sold the said property had to
be in possession of a valid
fidelity fund certificate for the period
2019 and until January 2020 when the sale agreement was finally
concluded, to be entitled
to commission.
[17]
It was submitted by Mr. Reddy on behalf of First Claimant that the
supplementary particulars
of claim and affidavit of Vial indicates
that Second Claimant did not have the necessary certificate due to
the fact that the audit
reports had not been complied with and was
therefore not entitled to receive the commission. It was
submitted that it must
be at the time of the sale and accordingly
that Second Claimant in terms of the affidavit of Vial was not
correctly registered
at the time, did not have the necessary
certificate and could therefore not have claimed the commission.
He further dealt
with the issue of the effective cause of sale and as
to who was responsible for the conclusion of the sale and was the
effective
cause thereof.
[18]
Mr. Scheepers on behalf of Second Claimant referred to paragraph 22
of the judgement of Bezuidenhout
AJ in the application for
condonation where she referred to the fact that Second Claimant was
in possession of a certificate for
the year 2019. He referred
to the email which was attached to First Claimant’s particulars
of claim and submitted that
the affidavit was under oath by Vial and
attached to the papers of Second Claimant. It was an affidavit
and not merely an
email attached to First claimants papers.
Accordingly Second Claimant was duly registered and had the necessary
certificate
during 2019 and that the judgment of Bezuidenhout AJ in
that regard was correct and should be followed. He submitted
that
even if a penalty or a fine is paid then the estate agent can
still continue. He submitted that section 27 of the Estate
Agency Affairs Act is not applicable. He then further dealt
with the issue of the effective cause of sale.
[19]
Firstly in regards to the judgment of Bezuidenhout AJ the issue to be
determined at that stage
was different to that which has to be
decided at this stage. The issue before her was one of
condonation and accordingly
she merely had to consider whether there
were any prospects in the merits of the case and did not have to deal
with the main issue.
Further at the time that Bezuidenhout AJ
gave her judgment the second affidavit by Vial, which is now attached
to First Claimants
amended particulars of claim, had not been part of
the papers and that clearly sets out what the position was.
[20]
Mr. Scheepers did not deal with the second affidavit of Vial which
was filed in June 2022 attached
to Second Claimants amended
particulars of claim. Therein she does not just confirm what is
set out in the email but specifically
states that at the time that
the sale was concluded Second Claimant was not registered, did not
have a fidelity fund certificate
and therefore could not claim any
commission for any work that was done. It also is apparent from
Second Claimant’s
particulars of claim that Jason Redinger was
the agent who conducted the sale on behalf of Second Claimant.
There is no indication
in the papers that he had the necessary
certificate to do so. On a reading of sections 26 and 34(A) of
the Estate Agents
Act it would appear that as the agent he also had
to be in possession of a certificate as required by section 26.
However,
even if I am incorrect in that regard, it is clear
from the affidavit of Vial which was attested to during June 2022
that Second
Claimant was not registered at the time, that there were
difficulties with the audits and that they had to pay a fine.
It
is further clear that the paying of a fine on its own does not
merely entitle you to continue with the selling and obtaining of
commission but that it is only once the certificate is issued that it
is then applicable and then only until 31 December of that
year.
[21]
A consideration of the sections of the Act which has been referred to
above indicate that commission
can only be claimed when there is a
valid certificate for that specific period. From the affidavit
of Vial dated June 2022
it is clear that at the time that the sale
was concluded in 2019 Second Claimant did not possess such a valid
certificate.
Accordingly neither Second Claimant nor its
employees was entitled to claim any commission during that time even
if Second Claimant
was the effective cause of sale. The
certificate was only issued to them on 10 March 2020. In
Brodsky Trading v Cronimet
Chrome
2017 (4) SA 610
(SCA) dealing with
the Estate Agency Affairs Act it was held that absent a certificate
an agent could not receive commission.
[22]
I accordingly am satisfied that Second Claimant did not have a valid
fidelity fund certificate
at the time that the sale was concluded and
accordingly is not entitled to the commission. It is therefore
not necessary
for me to further consider the second issue namely that
of who was the effective cause of sale.
[23]
As already set out above the opposition to the supplementary
particulars of claim of First Claimant
was only of a technical nature
which I found was not applicable as it was an interlocutory
application and accordingly that the
particulars of claim had to be
admitted.
[24]
It is only the letter and the affidavit of Vial attested to during
June 2022 which sets out the
position clearly and contradicts her
previous affidavit that Second Claimant was registered during 2019.
In my view it is
therefore not appropriate to award costs on an
attorney and client scale as requested by First Claimant.
In the circumstances the
following order is made.
1.
First Claimant’s supplementary particulars of claim is
admitted.
2.
Applicant is directed to make payment of the commission for the sale
the property described
as erf [....], [....] D[....] Drive A[....],
R[....], KwaZulu-Natal, in the sum of R 529 000-00 to First Claimant.
3.
Second Claimant is directed to pay First Claimants costs.
BEZUIDENHOUT J.
JUDGMENT
RESERVED: 15
AUGUST 2022
JUDGMENT HANDED
DOWN: 1
SEPTEMBER 2022
COUNSEL FOR FIRST
CLAIMANT: T.
Q. REDDY
Instructed
by: Shepstone
& Wylie
Pietermaritzburg
Ref:
JTM/MM
Tel:
033 3551780
COUNSEL FOR SECOND
CLAIMANT:
J. SCHEEPERS
Instructed
by:
Van
Deventer and Van Deventer
Incorporated
Rivonia
c/o
Hainsworth Koopman Attorneys
Pietermaritzburg
Ref:
VDV1/0001
Tel:
033 816 7042
Cell:
082 825 2724 (Mr. Scheepers)
APPLICANT’S
ATTORNEYS:
A & R
ATTORENEYS
C/O
MORNE DU PLESSIS
ATTORNEYS INC
PIETERMARITZBURG
Tel:
033 342 0738