J R 209 Investments (Pty) Ltd and Another v Pine Villa Country Estate (Pty) Ltd, Pine Villa Estates (Pty) Ltd v J R 209 Investments (Pty) Ltd (617/07, 2/08) [2009] ZASCA 3; 2009 (4) SA 302 (SCA) ; [2009] 3 All SA 32 (SCA) (26 February 2009)

About SAFLII
Databases
Search
Terms of Use
RSS Feeds
South Africa: Supreme Court of Appeal
SAFLII
>>
Databases
>>
South Africa: Supreme Court of Appeal
>>
2009
>>
[2009] ZASCA 3
|

|

J R 209 Investments (Pty) Ltd and Another v Pine Villa Country Estate (Pty) Ltd, Pine Villa Estates (Pty) Ltd v J R 209 Investments (Pty) Ltd (617/07, 2/08) [2009] ZASCA 3; 2009 (4) SA 302 (SCA) ; [2009] 3 All SA 32 (SCA) (26 February 2009)

Links to summary

THE
SUPREME COURT OF APPEAL
REPUBLIC
OF SOUTH AFRICA
JUDGMENT
Case no: 617/07
J
R 209 INVESTMENTS (PTY) LTD
First
Appellant
M
& T DEVELOPMENT (PTY) LTD
Second
Appellant
and
PINE
VILLA COUNTRY ESTATE (PTY) LTD
Respondent
___________________________________________________________
Case no: 2/08
PINE
VILLA COUNTRY ESTATE (PTY) LTD
Appellant
and
J
R 209 INVESTMENTS (PTY) LTD
Respondent
___________________________________________________________
Neutral citation:
J R 209
Investments v Pine Villa Estates
(617/07);
Pine Villa Estates
v
J R 209 Investments
(2/08)
[2009] ZASCA 3
(26
February 2009)
CORAM:
Harms
ADP, Ponnan, Cachalia JJA, Leach and Mhlantla AJJA
HEARD:
18 November 2008
ORDER:
28 November 2008
REASONS:
26 February 2009
CORRECTED:
SUMMARY:
Validity
of a deed of sale of land – whether the description of property
alienated was sufficiently clear in terms of
s 2(1)
of the
Alienation of Land Act 68 of 1981
–
interdict preventing the establishment of a township development set
aside – application for leave to amend pleadings dismissed
.
___________________________________________________________
ORDERS
___________________________________________________________
1
In
J R 209 Investments (Pty)
Ltd and M & T Development (Pty) Ltd
v
Pine Villa Estates (Pty) Ltd
(case 617/07):
(i) the appeal is upheld with costs, including  the
costs of two counsel;
(ii) the order of the court below is set aside and
replaced with an order in the following terms:-
‘
The application is dismissed with costs, inclusive of
the costs of two counsel.’
2 In
Pine Villa Estates (Pty) Ltd
v J R 209 Investments (Pty) Ltd
(case 2/08):
The appeal is dismissed with costs, including the costs
of two counsel.
_____________________________
______________________________
REASONS FOR JUDGMENT
___________________________________________________________
HARMS ADP et MHLANTLA AJA
(
PONNAN, CACHALIA JJA
and
LEACH AJA
concurring):
Introduction
[1] These reasons for judgment deal with two related
appeals: the first was an appeal against the judgment of Rabie J in
J
R 209 Investments (Pty) Ltd and M & T Development (Pty) Ltd
v Pine Villa Estates (Pty) Ltd
(case no 617/07) (the first case); and the second was against a
judgment of Botha J in
Pine Villa Estates
(Pty) Ltd
v
J R 209 Investments (Pty) Ltd
(case no 2/08) (the second case). As the citations suggest, the
parties in the second appeal were also adversaries in the first.
[2] Both appeals arose from an agreement to sell land
and the seller’s allegation that the agreement was either void or
had been
cancelled. They were heard together. Due to the urgency of
the matter the orders issued on 28 November 2008, it having been
intimated
then that reasons were to follow. The first case concerned
the grant of an interdict by Rabie J, effectively preventing the
purchaser
from dealing with the property sold pending the conclusion
of action proceedings. In that matter the order of this Court was to

uphold the appeal with costs, including the costs of two
counsel; to set aside the order of the court below and replace it

with an order in the following terms:
‘The application is dismissed with costs, inclusive of  the
costs of two counsel.’
The second case concerned the refusal by Botha J to
permit the seller of the property to amend its particulars of claim
to reflect
certain additional causes of action on which the interdict
was based. The order on appeal was as follows:
‘In case 2/08, the appeal is dismissed with costs, including the
costs of two counsel.’
It will be immediately apparent that the two learned
judges had diametrically opposed views about the matter.
[3] Although the appeals depend on essentially the same
legal questions, different considerations may arise in deciding the
two
cases because amendments and interdicts are not decided on the
same principles.
The contract
[4] Pine Villa Estates (Pty) Ltd was the seller of a
property which for the sake of convenience will be referred to as
Portion 7.
Its sole shareholder and director was Mr Patrick Ian
Oberem. He was not a party to the litigation although he was the main
deponent
to the affidavits in the interdict proceedings. The
purchaser was JR 209 Investments (Pty) Ltd while M&T Development
(Pty)
Ltd was the developer of the property, which had been bought
for the purpose of township development. The proposed township in the

course of events came to be known as Monavoni Extension 18, which
consisted of a number of properties including Portion 7. The
parties
will be referred to by their aforesaid contractual capacities.
[5] On 12 May 2004, the seller (represented by Mr
Oberem) and the purchaser entered into an agreement of sale in terms
of which
the seller sold to the purchaser the immovable property
described as ‘portion 7 of the farm Swartkop 383, JR, Gauteng –
in
extent 8,5653 hectares’. The purchase price of R3,5m was
payable in two tranches: a non-refundable deposit of R500 000 was
payable
upon acceptance of the offer to the seller and the balance on
registration (guarantees had to be issued within 90 days of the date

of signing).
[6] A few further terms have to be noted. In terms of
clause 5.1 the property was to be transferred to the purchaser as
soon as
the purchaser had complied with ‘all obligations in terms
of this agreement’. Possession of the property was to pass on
registration
subject to the right of ‘the seller’ to occupy the
portion of the property mentioned in clause 11.2 (to which we shall
revert
soon). The agreement also recorded that the purchaser would,
already upon acceptance of the offer, immediately initiate the
process
of township development.
[7] Much of the case turns on clause 11.2 which was in
these terms:
‘Both parties take note that a portion of this property between
5000 m
2
and 5653 m
2
in extent and including the
residential house on this property is to be transferred into the name
of Ian Patrick Oberem I.D. 6504135149081
as soon as sub-divisional
diagrams are available to effect this transfer. The Purchaser shall
be liable for all costs relating
to this subdivision and hereby
guarantees that these diagrams will be available not later than 7
(seven) months after date of this
agreement. The Seller shall be
liable for all costs regarding the transfer of this property into the
name of I.P. Oberem.’
[8] On 1 October 2004, Portion 7 was transferred to the
purchaser. The purchaser was, however, unable to make the diagrams
referred
to in clause 11.2 ‘available’ within the agreed period
or for that matter when the action was instituted during February
2007
or even later when the interdict proceedings were launched
during May 2007. The effect thereof is that the property described in

clause 11.2 (the clause 11.2 property) was not transferred into the
name of Mr Oberem. The reasons for the purchaser’s failure
to
perform in terms of this ‘guarantee’ or to transfer the portion
are of no consequence and need not be related.
The seller’s claim
[9] The seller then issued summons against the
purchaser claiming retransfer of Portion 7 and, in the alternative,
payment of damages
being the difference between the present market
value of the property and the purchase price. The cause of action was
an alleged
breach of the sale agreement, arising, so it was
contended, from the purchaser’s failure to obtain the
sub-divisional diagrams
within the stated period. The particulars
further alleged that due notice had been given in terms of the
cancellation clause; that
the purchaser had failed to rectify the
breach within the stated period; and that the contract had been
cancelled.
[10] When the seller decided to launch the interdict
proceedings it received advice to amend its cause of action and to
base the
interdict proceedings on the new causes. The application to
amend the particulars of claim (which was opposed) and the interdict

proceedings followed different routes and the interdict proceedings
terminated before the amendment proceedings. In order to assess
the
validity of the seller’s causes of action, both for purposes of the
amendment and the interdict, it is convenient to begin
with a
consideration of the amendment application.
[11] It is not neccessary to quote the terms of the
proposed amendment but it boils down to this. First, the seller
alleged that
the agreement of sale was invalid because it did not
comply with the provisions of
s 2(1)
of the
Alienation of Land Act 68
of 1981
, which reads as follows:
‘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 the
parties thereto or by their agents acting
on their written
authority.’
Its case was that although Portion 7 had been adequately
identified, the area to be excluded and re-transferred to Mr Oberem
in
terms of clause 11.2 was not; the contract was accordingly invalid
and unenforceable
ab initio
for non-compliance with
s 2
of the Act inasmuch as that piece of land
could not be identified with reference to the provisions of the
contract alone.
[12] The alternative cause of action was based on a
failure to comply with the ‘guarantee’ contained in clause 11.2
within
the time limit. The seller sought to make it clear that it was
relying on the fact that a guarantee imposes an absolute obligation

to comply and that it is not necessary to first place a party who has
failed to honour the guarantee
in mora
in order to cancel.
[13] Before dealing with these two causes of action it
is necessary to deal with another amendment which has no bearing on
the relief
sought but which was ostensibly introduced to forestall a
defence. The seller wished to allege that the property sold was not
Portion
7 as set out above but Portion 7 minus the clause 11.2
portion and that Mr Oberem was the person authorized to receive
transfer
of the latter portion as the
solutionis
causa adjectus
of the seller. The seller
presumably anticipated that the purchaser would allege that clause
11.2 was intended to create a contract
for the benefit of a third
person and that Mr Oberem was accordingly the person to enforce its
provisions after having accepted
the benefit. (It transpired during
the interdict proceedings and from the notice of objection to the
amendment that this was indeed
the purchaser’s case.) The other
unexpressed reason for these allegations may well have been to
anticipate reliance on the
Wilken v Kohler
1
principle, which was incorporated into the Act - namely that an
alienation which does not comply with the provisions of
s 2(1)
‘shall
in all respects be valid
ab initio
if the alienee had performed in full in terms of the deed of
alienation or contract and the land in question has been transferred

to the alienee.’
2
[14] Although the seller initially sought to rely on
either the express alternatively tacit terms of the contract, it soon
became
clear that sole reliance was placed on tacit terms. These
tacit terms are, however, in conflict with the express terms of the
contract.
The
merx
was
clearly identified as Portion 7. Although ultimately Portion 7 less
the clause 11.2 portion would have come to be in the hands
of the
purchaser, the parties decided to structure their agreement
differently. The clause 11.2 portion was not to be retransferred
to
the seller, but rather to its sole shareholder and director, Mr
Oberem. It is consequently artificial to redefine the
merx
as suggested in the amendment. In our view the facts of the present
case are similar to those in
Olifants Trust Co
v Pattison
3
and the ratio of that judgment at 891C-G is
applicable. The contract further stated that transfer was to be
effected after the
purchaser had complied with ‘all’ obligations
in terms of the agreement. That provision clearly did not relate to
clause 11.2.
And, it will be recalled that transfer did take place
after payment of the purchase price. Nor it is it alleged to have
taken place
in error (except in relation to the validity of the
contract). Transfer duty had to be paid by the purchaser on the full
price
and the seller undertook to pay the transfer costs (which would
include transfer duty) on the clause 11.2 portion - facts that are

destructive of the seller’s argument.
4
Mr Oberem could also not have been an
adjectus
simply because the clause 11.2 portion had to be registered in his
name and not in the name of the seller. One person cannot without

more receive transfer of an immovable property on behalf of another.
The expressed intention was that Mr Oberem would become owner
of that
portion on registration. It is conceivable that the agreement was
thus structured for tax or transfer duty reasons or to
make the
seller company a shell company. There is no reason why the parties
should not be held to their chosen structure irrespective
of their
motives.
[15] We are satisfied that the clear intention of the
parties was to create a contract for the benefit of a third party.
Since Mr
Oberem negotiated and signed the agreement one would have
assumed that he had then already accepted the benefit of clause 11.2.

If he did, it follows that he was the only person who was entitled to
enforce its provisions. Cancellation of the main agreement
was not an
option available to him. All he could claim was specific performance
under clause 11.2 or damages for non-compliance
with its provisions.
If he failed to accept the benefit, there was nothing the seller
could claim vis-à-vis the purchaser.
This conclusion disposes
at the same time of the alternative based on the guarantee argument.
[16] It follows from this that Botha J correctly
dismissed these particular aspects of the application to amend and
that Rabie J
had erred in holding that the seller had locus standi to
reclaim Portion 7.
Validity of the Deed of Sale
[17] We now turn to deal with the validity of the deed
of sale. Rabie J held that the description of the portion of land
mentioned
in clause 11.2 was not sufficiently clear to comply with
the requirements of
s 2
and would result in an insufficient
description of the
res vendita
if it could not be severed from the remaining part of the contract.
He held that Mr Oberem at all relevant times intended to remain
in
his house and the adjacent area and that he would become the
registered owner thereof. The learned judge accordingly held that

the deed of sale was
prima facie
void
for want of
compliance with
s 2(1).
Botha J, on the other hand, held that the
deed of sale was valid because the property was adequately described
and the fact that
the shape and exact configuration of the clause
11.2 portion were left entirely to the purchaser’s discretion
depending on the
layout of the township did not invalidate the
agreement.
[18] It does not matter for purposes of this part of
the judgment whether the property sold was Portion 7 or, as alleged
by the
seller, Portion 7 minus the clause 11.2 portion. Bearing in
mind that the Act applies to the alienation of land which by
definition
‘includes’ a sale, exchange or donation, the clause
11.2 portion was ‘alienated’ by the purchaser to Mr Oberem.
[19] The test for compliance with the provisions of
s
2(1)
is whether the land alienated can be identified on the ground by
reference to the provisions of the contract without recourse to

evidence from the parties as to their negotiations and consensus.
5
The section does not however, ‘require a written contract of sale
[now: alienation] to contain, under pain of nullity, a faultless

description of the property sold couched in meticulously accurate
terms’.
6
[20] For the proposition that this agreement was void
for failing to describe the
merx
,
counsel for the seller relied on
Parsons v M C
P Bekker Trust (Edms) Bpk
.
7
The property sold in
Parsons
was described as a portion of a certain farm measuring 92,5764
hectares excluding the dwelling house and vacant ground around it
of
approximately 3965m². The Court held that the property
described was inadequately described because, as it said, not a
word
was contained in the contract as to how the configuration of the
homestead area was to be determined (at 104C-D) and that
to render
the agreement effective the parties should have included some
indication of how or by what means the shape of the land
embracing
the homestead portion was to be determined (at 104E-F).
[21] In
Clements v Simpson
8
the part sold had to be subdivided from the property as a whole. The
seller contended that the part sold was inadequately described
and
that the contract was thus of no force or effect for want of
compliance with
s 1
of the then applicable General Law Amendment Act
68 of 1957 (which was almost identical to the provisions of s 2(1)).
The part
sold was identified by stating the exact area; the location
(adjoining a named street, situate in the north-western extremity of

the main property); and the minimum frontage on that street. The
judgment then stated (at 8E-H) :
‘Now it is apparent that those provisions do not, and could not
have been intended to, enable identification of the land on the

ground. The reason is that the parties could not but have realised
that, in giving effect to the foregoing provisions, there was
a
variety of possible shapes which the seller could select in bringing
about the sub-division of her land. In that regard the site
sold is
one of a class. The area remains constant (40,000 square feet); and
the general location is fixed (North-western extremity
of Portion 1);
but the shapes will depend upon (a) the extent to which the selected
road frontage exceeds the agreed minimum of
175 feet, and (b) the
geometrical layout - the site might be square, or rectangular, or its
angles might not be 90°.’
The court nevertheless held that the contract was valid
because there were indications in the contract that the seller would
determine
the shape. Distinguishing the case from
Botha
v Niddrie
,
9
Holmes JA said (at 9A-B):
‘But the instant case is different because here the intention of
the parties, as gathered from the language of their contract,
was not
to enable identification of the land sold by reference to
description; it was to be identifiable only after the seller
had
decided upon the lay-out and shape and sub-division of a site
conforming to certain specified requirements. It is in my view
a
clear example of the second category mentioned earlier. The
consensus
of the parties was complete. All that was needed for performance was
the intended unilateral act of the seller in the matter of
shape and
sub-division. The fact that survey was required for that purpose
cannot affect the question; ... I therefore hold that
the contract
does comply with the provisions of sec. 1 (1) of Act 68 of 1957.’
[22] In the present case the situation is similar. The
contract envisaged that the purchaser would establish a township on
Portion
7 and that the homestead portion was to form a separate erf
as part of the development. The purchaser by necessary implication
had the right to determine the shape and size of the erf subject to
two express limitations, namely that the residence had to be
included
and that the erf had to be between 5 000 and 5653 m
2
.
10
There was an additional implied limitation namely that the
purchaser’s determination should have been bona fide.
11
[23] In the result we are of the view that the
description of the property alienated in terms of clause 11.2
sufficed for purposes
of s 2(1) and that this ground of attack has no
merit. This means that the amendment was rightly refused by Botha J
and that Rabie
J had erred in finding that the seller had any right
that could be protected by an interdict.
Appealability of the Interim Interdict
[24] The final issue to be decided is whether the
interdict granted by Rabie J was appealable. He granted an order in
the following
terms:
‘An interim interdict is granted pending the final adjudication of
[the action] . . . in terms of which the [purchaser and the

developer] are restrained from:
‘(a) Lodging the plans, diagrams or title deeds in respect of the
township Monavoni Ext 18 for endorsement or registration .
. . or
(b) . . . procuring the registration of the general plan of the
township Monavoni Ext 18 . . .,
(c) Taking any further steps . . . declaring the township an approved
township . . ..’
[25] In
Cronshaw & Another
v Coin Security Group (Pty)
Ltd
12
this Court held that an interim interdict was appealable if it were
final in effect and not susceptible to alteration by the court
of
first instance.
Metlika
Trading Ltd and Others v Commissioner, South
African Revenue Service
13
held that in determining whether an order is final, it was important
to bear in mind that ‘not merely the form of the order
must be
considered but also, and predominantly, its effect.’
[26] The order which was sought and granted had as its
substrate that the purchaser and the developer were prohibited from
proceeding
with the establishment of the township as a whole and not
only in respect of the development of Portion 7. The order affected
the
entire development, yet the dispute between the parties related
to portion 7 only. The order was overbroad. The right to develop
the
township as a whole is not an issue that would be decided by the
trial court
and it was
consequently final in effect even if only for a limited period.
14
In our view the
merx
could have been preserved without the necessity for an order in those
terms. It follows therefore that the order of Rabie J was

appealable.
Conclusion
[27] The findings made earlier that the seller had no
right, prima facie or otherwise, that could have been protected by an
interdict
mean that the order granted by Rabie J had to be set aside.
[28] The other side of the coin is that in view of our
interpretation of the contract the proposed amendments were
ill-conceived.
In the result
Botha J was correct in dismissing the seller’s
application to amend. This appeal was consequently dismissed.
__________________________
L.T.C.
HARMS
ACTING DEPUTY
PRESIDENT
_____________________
N.
Z. MHLANTLA
ACTING
JUDGE OF APPEAL
APPEARANCES:
For
Appellant: A C Ferreira SC
I
Ellis
Instructed
by
A
B Löwe Attorneys, Pretoria
Honey
Attorneys, Bloemfontein
For
Respondent: S J du Plessis SC
J
C Viljoen
Instructed
by
Le
Roux Du Plessis Attorneys, Pretoria
Naudes
Inc, Bloemfontein
1
Wilken v Kohler
1913 AD 135.
2
Section 28(2).
3
1971 (3) SA 888
(W) at 891.
4
Olifants Trust Co v Pattison
at 890F-H.
5
Clements v Simpson
1971 (3) SA 1
(A) at 7F-G.
6
Van Wyk v Rottcher’s Saw Mills (Pty) Ltd
1948 (1) SA 983
(A) at 989.
7
1978 (3) SA 101 (T).
8
Supra.
9
1958 (4) SA 446
(A).
10
Cf
Mayfair South
Townships (Pty) Ltd v Jhina
1980 (1) SA 869 (T) at 872D-873E.
11
SA Forestry Co Ltd v York Timbers Ltd
2005 (3) SA 323,
[2004] 4 All SA 168 (SCA). Cf
NBS Boland
Bank Ltd v One Berg River Drive CC; Deeb v ABSA Bank Ltd; Friedman
v Standard Bank of SA Ltd
1999 (4) SA 928
,
[1999] 4 All SA 183
(SCA).
12
[1996] ZASCA 38
;
1996 (3) SA 686
(A).
13
2005 (3) SA 1
(SCA) at para 23.
14
Maccsand CC v Macassar Land Claims Committee
[2005] 2 All SA
469
(SCA).