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[2021] ZAGPPHC 291
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Mashigo and Another v Solomon and Others (21436/20) [2021] ZAGPPHC 291 (18 March 2021)
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HIGH COURT OF SOUTH AFRICA
(GAUTENG DIVISION, PRETORIA)
CASE NO: 21436/20
REPORTABLE:
NO
OF INTEREST TO OTHER JUDGES: NO
REVISED:
yes
Date:
18 March 2021
Hearing before Rabie J by way of Zoom
conference.
In the matter
between
:
D.T.
MASHIGO
First Applicant
L.G.
MASHIGO
Second Applicant
and
W. SOLOMON
First Respondent
M.
MAGAOGA
Second Respondent
N.
MAGAOGA
Third Respondent
REGISTRAR OF DEEDS:
PRETORIA
Fourth Respondent
JUDGMENT
1.
In
this application the applicants seek the following orders:
declaring the transfer of an immovable property in The Reeds,
Centurion, to the second and third respondents to be null and void ab
initio; declaring the subsequent transfer of the aforesaid
property from the first respondent to the second and third
respondents to be invalid; directing the fourth respondent, the
Registrar of Deeds, to cancel the registration of the property in
favour of the second and third respondents and to restore the
registration of the property in the name of the first respondent in
order to give effect to the pre-emptive right which was obtained
by
the first applicant from the first respondent as per the order of
this Court under case number 89177/2019; and an order for
costs on
the scale as between attorney and client against those parties
opposing the application.
2.
The
second and third respondents opposed this application and have
launched a counter application for the eviction of the applicants
from the property. The counter application was not opposed by
the applicants.
3.
The
background to the applications is briefly the following. During
October 2018 the first applicant and the first respondent concluded
a
lease agreement in respect of the immovable property which were
rented for business purposes by the first respondent to the first
applicant. The lease was for a period of 12 months with an option to
renew the lease two months prior to its termination, which
was 15
October 2019. According to the applicant the parties agreed to the
extension of the lease which included a right of first
purchase
should the first respondent, as owner, decide to sell the property.
According to the first applicant the first respondent
advertised the
property for sale without offering it to the applicants. This dispute
appears to have been resolved but during November
2019 the second
applicant was informed that the property was to be registered in the
name of the second respondent since it had
been purchased by the
first and second respondents.
4.
The
first and second applicants thereupon applied to the court for an
urgent interdict preventing the transfer of the property to
and the
registration thereof in the name of the second and third respondents.
5.
It
appears that the court hearing the urgent application made no factual
finding on the merits of the applicants' right to purchase
the
property and that the presiding Judge urged that the parties to
discuss the possibility of settling the application on certain
terms
suggested by him. The parties did so and a draft order was handed up
and made an order of court 5 December 2019 by Baqwa
J. The
relevant part of the order reads as follows:
"1.
The first respondent is ordered to provide the applicants with a
written sale agreement
for the purchase of the property, […]
Street, […], Centurion (hereinafter referred to as "the
property");
2.
The sale agreement shall be on the following terms and conditions:
2.1
The purchase price shall be R 1 750 000, 00 (one million seven
hundred and fifty thousand rand);
2.2
The sale agreement will be subject to the suspensive condition that
the applicants obtain financing in the
form of a bank guarantee from
a financial institution for the full purchase amount, within 30
(thirty) days from receiving the
signed agreement from the first
respondent as per paragraph 1.
3.
Should the applicants fail to deliver the counter signed agreement
together with
proof of obtained financing as contemplated in
paragraph 2.2 above, within 30 days of receiving the signed
agreement, the first
respondent is entitled to sell the property to a
third party, and the applicants will not be entitled to challenge or
dispute the
sale and transfer of the property to a third party;
4.
Each party to pay its own costs. Respondents are interdicted from
transferring
property for a period of 30 (thirty) days from the
granting of this order."
6.
Consequently,
in terms of the order the applicants would be supplied with a signed
sale agreement on the terms set out in the order
and subject to the
suspensive condition that the applicants would obtain financing for
the purchase of the property within 30 days
of receiving the signed
agreement. The applicants had to countersign the aforesaid signed
agreement supplied to them together with
proof that they had obtained
finance as contemplated in paragraph 2.2 of the court order. If the
applicants complied with their
obligations, they would be allowed to
purchase the property. Furthermore, the respondents were interdicted
from selling or transferring
the property for a period of 30 days
being the period allowed to the applicants to obtain financing. If
the applicants were not
able to obtain financing within the 30 day
period, the interdict would lapse and the first respondent would be
allowed to transfer
the property to the second and third respondents.
7.
On
9 December 2019 the signed agreement of sale together with a cover
letter was sent to the applicants' legal representatives.
The terms
of the agreement mirror those contained in the order of 5 December
2019. On 11 December the applicants' representative
wrote a letter to
the attorney of the second and third respondents indicating that they
had not received the signed agreement.
In a return email reference
was made to the previous email by which the agreement was sent and a
copy of the agreement was again
attached to this email. There was no
response by the applicants to this email.
8.
The
applicants failed to comply with the suspensive condition and did not
manage to obtain financing for the purchase of the property.
The
attorney of the second and third respondents advised the applicants
that the 30 day period had lapsed and that the property
would be
transferred to the second and third respondents. The applicants again
failed to respond to this email. As a result the
property was
transferred to the second and third respondents.
9.
The
attorney of the second and third respondents was informed by the
Deeds Office that the interdict granted on 5 December 2019
was still
reflected on the property file despite the fact that the 30 day
period had lapsed. Accordingly the attorney directed
a letter to the
applicants putting on record that the period had lapsed and requested
them to uplift the interdict so that the
property could be
transferred.
10.
On
23 January 2020 the first applicant requested the attorney of the
second and third respondents to provide an agreement to her
to which
the attorney responded by saying that the agreement had on two
previous occasions been provided to the applicants.
11.
The
applicants then changed their attitude by saying that they had
received an annexure and not the full agreement. It eventually
appeared that the applicants wanted a copy of the sale agreement
between the first respondent and the second and third respondents.
The court order of 5 December 2019, however, makes no reference to
that agreement. The second and third respondent submitted that
it was
clear that the applicants did their utmost to frustrate the transfer
of the property which they were occupying without paying
rent.
As a result of the applicants' failure to comply with the order dated
5 December 2019, and specifically the suspensive
condition, the
Registrar of Deeds eventually proceeded with the transfer of the
property and this occurred on 13 February 2020.
12.
Although
the applicants claim in the present application that they have
complied with the suspensive condition, this is clearly
not the case.
They did not obtain a bank guarantee as alleged but instead presented
merely a request and/or quote for financing
which was, in any event,
for an amount less than the purchase price of the property.
Furthermore, the Acceptance of the Home Loan
Offer was dated 26
February 2020 while the bank guarantee had to be provided, at the
latest, by 9 January 2020.
13.
In
addition, the applicants failed to show in the present application
that they could tender the full purchase price of the property.
The
loan which they might have been able to obtain fell far short of the
purchase price of the property.
14.
In
the result the applicants failed to comply with the suspensive
condition with the effect that the agreement never came into effect.
The second and third respondents were consequently entitled, in terms
of the order of 5 December 2019, to purchase the property.
In
the result, and according to the founding affidavit supporting the
relief claimed in the Notice of Motion, the applicants have
not shown
any right for the relief sought by them.
15.
On
the day of the hearing before this court Mr Mosala, appearing on
behalf of the applicants, applied for leave to file a supplementary
founding affidavit. After some discussion he was allowed to do so and
the matter stood down for two days.
16.
In
the supplementary affidavit which was filed the following was, inter
alia, noted as the grounds for the application. It was submitted
that
the sale agreement or offer to purchase between the parties was
regulated by the
Consumer Protection Act, 68 of 2008
. It was
submitted that the first respondent was in breach of the court order
granted in December 2019 and in this regard reference
was made to
section 55
(2) (a-b) and
section 55
(6) of the Act.
17.
It
was further submitted with reference to case law that a seller may
not rely on a voetstoots clause if he knew about the defect
at the
time of the sale; if he deliberately concealed the defect; and if he
made a fraudulent or innocent misrepresentation. It
was further
submitted that the seller would know that if the latent defect had
not been concealed, the purchaser would have negotiated
a more
favourable purchase price.
18.
In
paragraph 9.4 of the supplementary affidavit the applicants concluded
that in terms of
section 55
(6) a consumer who knowingly enters into
an agreement fully aware of the defect cannot have a recourse against
the seller upon
the conclusion of the sale agreement. The first
applicant added that in the present matter he did not sign the sale
agreement sent
to him because he was already aware of the latent
defects in the property being a defective foundation and faulty water
pipes.
Consequently, so he submitted, had he signed the contract he
would have been prejudiced and left without a remedy or any form of
relief. Further consequently, so he submitted, the first respondent
did not sell the property or allow the applicant to exercise
his
preferential right because he was aware that the applicant had
knowledge of the existing latent defects and this would have
affected
the selling price. It was noted that the sale agreement sent to
the applicant did not mention the latent defects
which the applicants
and the first respondent, as seller and purchasers, were aware of and
that if that had been done, the applicants
would have insisted on a
lesser purchase price. It was further submitted that since the
defects had not been specifically
mentioned in the deed of sale, a
valid contract had not been presented to the applicants. Lastly, it
was submitted that if the
first respondent submits a deed of sale to
the applicants mentioning the latent defects, that will reduce the
purchase price of
the property.
19.
The
applicants also referred to an addendum which was drafted on 29 June
2019 which referred to, inter alia, defects in the property.
According to the applicants this addendum forms part of the agreement
of sale.
20.
Firstly,
the addendum was drafted at a time when the parties were still
involved in a lease agreement. Secondly, the addendum made
provision
for the document to be signed by the parties but this never happened.
Thirdly, the applicants' submissions in respect
of the
Consumer
Protection Act are
totally misplaced. The provisions referred to
protect a purchaser who was unaware of latent defects of which the
seller had been
aware but had failed to inform the purchaser of. In
the present case the applicants, as purchasers, had at all times been
aware
of the alleged defects. They would consequently, and whether
the agreement of sale had mentioned to the defects or not, not have
been entitled to a reduction in the purchase price or cancellation of
the agreement if they had signed the agreement.
21.
The
biggest hurdle in the path of the applicants, and in this regard I
agree with the submissions on behalf of the second and third
respondents, is the fact that the previous court order quoted above,
determined what the first respondent had to do and what the
applicants had to do in order to purchase the property. According to
the court order the price had been set and the applicants
were given
an opportunity to purchase the property for that price. The
applicants were not entitled to impose further terms into
the
agreement nor to purchase the property for a lesser price. The
applicants were therefore also not in a position to prescribe
that
certain defects were to be fixed before they purchased the property.
The applicants were aware of all the alleged defects
and they had to
decide whether they could and would purchase the property for the
price indicated in the court order. They could
not insist on a
different price than had been accepted by the second and third
respondents as mentioned in the court order.
22.
The
court order was clear and the first respondent complied with its
terms. The issue of latent defects referred to in the supplementary
affidavit was clearly an afterthought in order to confuse the issues
and add to the disputes. I have already mentioned that
the
applicants failed to provide the required bank guarantee within the
required period of time and thus failed to adhere to the
suspensive
condition.
23.
In
the results of the applicants' application should be dismissed.
24.
Regarding
the counter application for eviction I have mentioned before that the
applicants failed to oppose that application. The
property was leased
for business purposes and as owners of the property the second and
third respondents have acquired the rights
and obligations of the
first respondent in terms of the lease agreement.
25.
The
applicants have failed to honour their rental obligations in terms of
the rental agreement and as at the date of the supporting
affidavit
the applicants were in arrears in the amount of R 192 636.65. The
applicants were duly notified to remedy the breach
but they had
failed to do so. Consequently the applicants are entitled to the
relief sought in the counter application.
26.
In
respect of the costs of both the main application and the counter
application there is no reason why costs should not follow
the event.
27.
In
the result that the following order is made:
1.
The applicants' application is dismissed with costs.
2.
In respect of the counter application in the Notice of Motion dated
22 September 2020 the following order is made:
2.1
The Respondents and/or all other illegal occupiers are hereby evicted
from the
property known as Erf […], […], […]
2.2
The Respondents and/or all other illegal occupiers are ordered to
vacate the
property within 21 days of service of this order.
2.3
Should the Respondents and/or any other illegal occupier fail to
vacate the
property within 21 days of service of this order, the
eviction order may be carried out and in which event the Sheriff of
this
Court is hereby authorised and ordered to evict the Respondents
and/or all other illegal occupiers from the property.
2.4
The respondents are ordered to pay the costs of the counter
application in the
Notice of Motion dated 22 September 2020 jointly
and severally.
C.P. RABIE
JUDGE OF THE HIGH COURT
18 March 2021
Attorneys for the
applicants:
Mokgatle
Lesole Attorneys
lesolemokgatle@gmail.com
Attorneys for the
Respondent:
Delport van den berg Attorneys
m.pienaar@delberg.co.za
krishnee@delberg.co.za