Sewpersadh and Another v Dookie (231/08) [2009] ZASCA 78; 2009 (6) SA 611 (SCA); [2009] 4 All SA 338 (SCA) (1 June 2009)

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[2009] ZASCA 78
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Sewpersadh and Another v Dookie (231/08) [2009] ZASCA 78; 2009 (6) SA 611 (SCA); [2009] 4 All SA 338 (SCA) (1 June 2009)

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THE
SUPREME COURT OF APPEAL
REPUBLIC
OF SOUTH AFRICA
JUDGMENT
Case
No:
231/08
No
Precedential Significance
GOPAUL
SEWPERSADH
First
Appellant
ROSHNI
DEVI SEWPERSADH
Second
Appellant
and
SURIAPRAKASH
DOOKIE
Respondent
Neutral
citation:
Sewpersadh
v Dookie
(231/08)
[2009] ZASCA 78
(1 June 2009)
Coram:
STREICHER
ADP, JAFTA and MAYA JJA, HURT and TSHIQI AJJA
Heard:
20
MAY 2009
Delivered:
1 JUNE 2009
Summary:
Sale
of land – termination of agreement of sale – whether conduct of
parties after valid cancellation thereof tantamount to
a revival of
the agreement.
______________________________
_______________________________
ORDER
_______________________________
______________________________
On
appeal from: High Court, Durban (Swain J sitting as court of first
instance).
1
. The
appeal succeeds with costs.
2. The
order of the court below is set aside and replaced with the following
order:
‘
(a)
The written contract of purchase and sale entered into by the
applicants and the respondent on 7 October 2003 is hereby declared

and duly cancelled.
(b) The
respondent is hereby ordered to vacate the business premises situated
at 19 Inwabi Road, Isipingo Rail, KwaZulu-Natal forthwith.
(c) Should the
respondent fail to vacate the said premises upon service of this
Order, the Sheriff is hereby authorised and directed
to immediately
evict him from the said premises.
(d) The
respondent is ordered to pay the costs of this application.’
_____________________________________
________________________
JUDGMENT
_____________________________________
________________________
MAYA
JA
(STREICHER ADP, JAFTA and MAYA JJA, HURT and TSHIQI AJJA concurring):
[
1] The
appellants, a married couple, are the registered owners of immovable
property situated at 19 Inwabi Road, Isipingo Road,
KwaZulu-Natal,
also known as Lot 60 Parukville, (the property). On 7 October 2003,
they concluded a written agreement with the
respondent for the sale
of the property in terms of which the respondent was given possession
and occupation of the property upon
his signature. Consequent to the
respondent’s failure to pay the purchase price within the period
stipulated in the agreement,
the appellants sought an order in the
Durban High Court (Swain J) declaring the agreement to be cancelled,
evicting the respondent
from the property and ancillary relief.
[2]
The court below refused the application on the basis that although
the agreement had been validly cancelled, it was subsequently
revived
by the parties’ conduct and that such revived agreement did not
have to meet the formalities contained in the
Alienation of Land Act
68 of 1981
for its validity.
1
With the leave of the court below, the appellants now appeal against
its judgment that the agreement had been revived.
[3]
Briefly
stated, the background facts of the matter are as follows. The
appellants were in a precarious financial position and faced
a
looming threat by their local authority to sell the property in
execution to discharge the substantial arrears in rates and taxes

which they owed. The first appellant then sought assistance from the
respondent, a long-time fellow businessman and neighbour.
They struck
an agreement under which the respondent would purchase the property
and settle the appellants’ various debts with
the purchase price.
Such price, fixed at R500 000, was to be paid in a rather elaborate
manner described in more detail later in
the judgment, but
essentially in monthly instalments of not less than R20 000 within 24
months from the date of the signature of
the sale agreement.
[4]
As they are wont, things did not go according to plan and the
purchase price had not been paid in full at the end of the contract

period. There was some dispute as to whether this constituted a
breach of the agreement as the respondent alleged that despite

repeated requests, the appellants had failed to supply him with
statements indicating the outstanding amount. This, the appellants

denied. There was disagreement also about the frequency of the
payments and whether the payments reduced the capital or interest

portions of the debts and how such interest arose. Be that as it may,
on the respondent’s own version only an amount of R428
912 had been
paid by 22 March 2007 when he prepared his answering affidavit, long
after the expiry of the contract period.
[5]
The appellants gave the respondent written notice to rectify the
breach in terms of the agreement. When payment was not made
within
the requisite period the appellants cancelled the contract on 5 April
2006. Thereafter, on 29 May 2006, they launched the
application.
[6
]
The respondent nevertheless continued making payments. Sums of
R5
000, R50 000 and R20 000 were paid into the appellants’ account on
4 July, 12 August and 25 October 2006, respectively.
But
nothing turned on these payments as it does not appear from the
papers when the appellants became aware of them. In the appellants

replying affidavit the first appellant, who deposed to the affidavit
said that he had recently received a statement from Standard
Bank
reflecting these payments. A controversial payment, as will appear
later in the judgment, is one made in December 2006 when
the first
appellant requested a sum of R50 000 from the respondent apparently
to purchase a house for his daughter and the respondent
gave him R30
000. Regardless of this payment, however, the application remained
pending and on 22 March 2007 the respondent filed
his answering
affidavit followed shortly by the appellants’ reply on 2 April
2007.
[7
]
In the court below, the respondent denied that he was in breach of
the agreement or that it had validly been cancelled. His main

contentions were that the letter of demand placing him in
mora
was defective as it did not specify the breach complained of and that
the appellants impliedly waived any right they may have had
to cancel
the agreement by continuing to accept payments after the purported
cancellation. However, no allegation of a waiver had
been made in the
papers before the court.
[8]
The court below accepted that the appellants did not rely on the
respondent’s breach to make full payment within 24 months
in their
letter of demand, but found that their reliance on the breach in
their founding affidavit was sufficient. The court concluded
that the
appellants had established that the respondent was in breach of the
agreement which entitled them to cancel the agreement
as they did. In
its view, the cancellation excluded the possibility of the waiver
contended for by the respondent. The court however
held that the
appellants’ request for a sum of R50 000, the payment by the
respondent of R30 000 ‘in respect of the purchase
price’ in
response thereto and the appellants’ failure to tender the return
of the additional payments made by the respondents
and the
respondent’s lengthy delay of ten months in filing his answering
affidavit, all amounted to a new agreement by the parties
to revive
the cancelled agreement.
[9]
In
argument before us, the respondent’s counsel prudently did not
persist with the denial of a breach of the agreement and challenged

only the validity of the cancellation. The essence of the challenge
was that the letter of demand did not comply with the provisions
of
the breach clause of the agreement, as it did not specify the breach
which founded the cancellation ie a failure to pay the
outstanding
balance within 24 months, such that the right to cancel did not
accrue to the appellants.
[10]
The procedure to be followed by the parties in the case of a breach
is set out in clause 9 of the agreement which provides:
‘
Should
the Purchaser commit any breach of the provisions of this agreement
(all of which shall be deemed to be material), and remain
in breach
for a period of 7 (seven) days from the date of written notice given
to him by the Sellers calling upon him to remedy
such breach, the
Sellers shall be entitled … to claim specific performance of all
the Purchaser’s obligations … or cancel
this agreement by written
notice to the Purchaser’.
[11]
The appellants issued the impugned notice through their attorneys on
20 March 2006. It is necessary to set it out in some
detail, and it
reads as follows:
‘…
We
refer to a Notice dated 12 October 2005 sent to you by … our
client’s former Attorneys, pursuant to an Agreement of Purchase
and
Sale entered into between you and our clients for the purchase and
sale of Erf 60 Parukville.
Our
instructions are that you are still in breach of the Agreement of
Purchase and Sale in that :-
You
have not made any payment to Business Partners and the amount due to
them as at 26 February 2006 is R246 074,52.
You
have only paid R40 000 towards the rates due on Erf 60 Parukville
and R10 000 towards the rates due on Erf 1816 Isipingo.
You
have not made any payment to The Standard Bank of SA Limited. The
amount currently owing to The Standard Bank is R124 237,36.
This
is a final demand calling upon you to remedy the afore-said breaches
within seven days of receipt hereof. Should you fail to
remedy the
breaches in full our Client intends inter alia to cancel the
Agreement of Purchase and Sale and retake possession of
the
property.’
Apparently,
this notice failed to elicit the desired response as it
was
followed by a letter dated 5 April 2006 in which the appellants
notified the respondent that in view of his failure to remedy
the
breach within the stipulated period, the agreement was cancelled and
requested him to vacate the property.
[12]
The
various items referred to in the notice which the respondent
allegedly neglected to pay are debts in the appellants’ banking
and
municipal accounts which the respondent had to discharge on the
appellants’ behalf under the agreement in payment of the
purchase
price. This is what necessitated the intricate payment scheme alluded
to earlier and it is convenient to set it out at
this stage.
[13]
The scheme is contained in clause 12 of the agreement headed
‘PURCHASE PRICE’ which provides:
‘
The
purchase shall be in the sum of R500 000 … [and] shall be paid as
follows:
(i)
the Purchaser undertakes upon signature hereof to pay the sum of R25
000 to Business Partners in respect of [bank] Account Number:

1314851003;
(ii)
the Purchaser undertakes to continue making monthly payments into the
said account of Business Partners until the Sellers’
indebtedness
and interest has been paid in full;
(iii)
the Purchaser undertakes to make monthly payments in respect of the
Seller’s indebtedness to Standard Bank of South Africa
bearing
Account Number: 211326119 in respect of a mortgage bond, which is
being held by the said bank over the Sellers’ property
described as
Lot 1816, Isipingo situated at 92 Platt Drive, Isipingo Hills,
KwaZulu-Natal;
(iv)
the Purchaser undertakes to make payment to the eThekwini
Municipality – South Operational Entity in respect of all arrear

rates due by the Sellers in respect of Lot 60 Parukville [the
property] and Lot 1816 Isipingo to date of signature hereof;
(v)
the Purchaser undertakes to make payment of not less than R20 000 per
month in respect of the reduction of the purchase price
which sum
shall be distributed equally in respect of payment to Business
Partners, Standard Bank and the eThekwini Municipality.
(vi)
the Purchaser shall be liable for interest and penalties and levies
in respect of each of the above accounts;
(vii)
it is recorded that the Purchaser shall complete payment of the
purchase price within a period of twenty four months from
date of
signature of this agreement;
(viii)
the Purchaser shall be liable for all future rates and taxes from
date of occupation until date of registration of transfer;
(ix)
Registration of transfer shall take place upon the Purchaser
fulfilling all conditions as above;
(x)
the Purchaser’s obligations in respect of the payment of the
mortgage bond to Standard Bank shall cease when the outstanding

balance in respect of the said account is R20 000.’
[14
]
The minutiae of the respondent’s contention that the notice is
defective are that (a) the breaches to which it referred, ie
failure
to pay Business Partners and Standard Bank and payment of only R10
000 towards rates, were not proved, (b) it did not record
the amount
that the respondent was required to pay to the various accounts, (c)
it demanded payment of more than was outstanding
even though the
amount was not specified and (d) it did not disclose what was
required of the respondent to rectify the breach.
[15]
As the respondent correctly pointed out, it is indeed not so that
only a sum of R10 000 was paid by the respondent in respect
of rates
for Erf 1816 as alleged in clause 2 of the letter of demand, that no
payments had been made to Business Partners and that
no payments had
been made to Standard Bank. But what is clear from the demand is that
the breach alleged is the breach by the respondent
to pay the full
purchase price. But submitted counsel for the respondent, the
respondent did not know what the purchase price was
because, although
the agreement stated that the purchase price was R500 000 it also
provided that the respondent would be liable
for interest and
penalties and levies in respect of each of the above accounts. Even
if that is so the respondent knew that at
least R500 000 had to be
paid within 24 months and that he had not done so. To that extent it
would have been clear to him what
the breach was that the appellants
required him to remedy.
[16]
The finding of the court below that the cancelled agreement was
revived by agreement between the parties may be disposed of
shortly.
An agreement to revive requires ‘a fresh meeting and concurrence of
the minds’ of the parties to restore the
status
quo ante.
2
No basis for a finding that there was consensus between the parties
that the agreement be revived is to be found in the affidavits
filed
by the parties. The respondent did not only not allege such an
agreement but could not do so in the light of his denial that
he had
breached the agreement and that the agreement had validly been
cancelled. Moreover, the second appellant was also a party
to the
agreement of sale and, as the respondent’s counsel conceded, there
was no evidence whatsoever of her consent to the revival
of the
agreement.
[17] Finally,
as to the inference drawn by the court below from the late filing of
the answering affidavit, I simply cannot fathom
its basis. There is
no hint at all of the reason of such delay in the papers.
[18]
For these reasons the court below erred in finding that the agreement
of sale had been revived. This finding dispenses with
the need to
deal with the question whether the agreement found by the court below
had to comply with the formalities prescribed
in the
Alienation of
Land Act.
[
19]
The following order is made:
1.
The appeal succeeds with costs.
2. The
order of the court below is set aside and replaced with the following
order:
‘
(a)
The written contract of purchase and sale entered into by the
applicants and the respondent on 7 October 2003 is hereby declared

and duly cancelled.
(b) The
respondent is hereby ordered to vacate the business premises situated
at 19 Inwabi Road, Isipingo Rail, KwaZulu-Natal forthwith.
(c) Should the
respondent fail to vacate the said premises upon service of this
Order, the Sheriff is hereby authorised and directed
to immediately
evict him from the said premises.
(d) The
respondent is ordered to pay the costs of this application.’
_______________________
MML MAYA
JUDGE OF APPEAL
APPEARANCES:
For
appellant: M Pillemer SC
Instructed by:
Kissoonlal &
Associates, Durban
Matsepe Inc,
Bloemfontein
For
respondent: N Singh SC
Instructed by:
Ash Kirpal
Attorneys, Pretoria
Fusi Macheka
Inc, Bloemfontein
1
In terms of
section 2
(1) of the
Alienation of Land Act of 1981
‘[n]o alienation of land … shall 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’.
2
Desai v Mohamed
1976 (2) SA 709
(N) at 712H-,
United
Bioscope Cafes Ltd v Moseley Buildings Ltd
1924 AD 60
at 67- 68;
Neethling v Klopper
1967 (4) SA 459
(A) at 466-467.