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[2021] ZAGPJHC 510
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M v Magudulela and Others (2019/26963) [2021] ZAGPJHC 510 (28 September 2021)
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REPUBLIC
OF SOUTH AFRICA
IN
THE HIGH COURT OF SOUTH AFRICA
GAUTENG
DIVISION, JOHANNESBURG
CASE
NO: 2019/26963
REPORTABLE:
NO
OF
INTEREST TO OTHER JUDGES: NO
REVISED:
NO
Date:28
September 2021
In
the matter between :
M[....],
J[....]
Applicant
and
MAGUDULELA,
THULANI CYRIL
First Respondent
STANDARD
BANK OF SOUTH AFRICA LIMITED
Second Respondent
THE
REGISTRAR OF DEEDS, JOHANNESBURG
Third Respondent
JUDGMENT
Delivered
:
This judgment is handed down electronically by circulation to the
parties’ representatives by email.
TURNER
AJ:
[1]
This application addresses competing interests over Erf [....],
Vosloorus
Extension 9 (“the property”).
[2]
The first respondent is the current registered owner and the second
respondent
is the bond holder, having registered security over the
property after granting a loan to the first respondent. The applicant
was
the registered owner prior to registration into the name of the
first respondent in 2010 and she seeks the following relief: an
order
declaring the registration and transfer of the property in the name
of the first respondent to be declared null and void;
cancellation of
Title Deed No. T44041/2010 (dated 15 December 2010) in terms of which
the property was registered in the name of
the first respondent; an
order directing the Registrar to transfer the property into her name;
and costs.
[3]
The first respondent opposes the relief. The second and third
respondents
have not participated in the litigation. I deal with the
question of service on the second respondent later in the judgment.
Relevant facts
[4]
The property was first established by Ekurhuleni Metropolitan
Municipality
during 1987 and a leasehold was registered against the
property in the name of A[....] S[....] R[....] (“R[....]”)
in 1989, together with a bond in favour of the Johannesburg Municipal
Second Pension Fund.
[5]
The applicant and R[....] were married in February 1989 and lived in
the
house which was constructed by them on the property. On 24 May
1991, the applicant obtained a divorce order in this Court (Case
No.
7110/1991) in terms of which the marriage between her and R[....] was
dissolved and the court ordered that R[....] forfeit
the benefits
arising out of the marriage in community of property. It appears
that, despite this order, the applicant was unable
to evict R[....]
from the house and he remained resident in the house until he passed
away in July 2000. In the period between
1991 and 2000, R[....]
married Ermaley T[....] (also referred to as Emily Tshidi Mmusi)
(“T[....]”) and it appears
that T[....] remained in
occupation of the property after R[....]’s death.
[6]
When the applicant attempted to register the property in her name,
following
the death of R[....], she discovered that a second divorce
order had been obtained in favour of R[....] in the Central Divorce
Court in August 1992, in terms of which the applicant was to have
forfeited all benefits arising from the marriage in favour of
R[....]. The applicant then launched proceedings in the High Court,
under the original divorce case number (1991/7110), citing
the
executor in R[....]’s deceased estate, T[....] and the Sheriff
for Boksburg. The matter came before Claassen J on 22
August 2006 and
Claassen J granted an order in terms of which: (i) the 1992
order granted by the Central Divorce Court was
declared null and
void; (ii) the 1991 divorce order was declared valid; (iii) the
executor of R[....]’s estate was to
“
do all such
things and sign all such documents as may be required to procure the
transfer of
[the property]
into the name of the applicant …”
(“the Claassen J order”).
[7]
The property was transferred and registered in the name of the
applicant
in April 2009 under T11591/2009.
[8]
In the current matter, the respondent alleges that the documentation
prepared
and relied upon by the applicant to obtain transfer in 2009
misrepresented her position as it referred to her as a “surviving
spouse”, which was false in 2009. The respondent alleges that,
as a result, the transfer to the applicant was fraudulent
and cannot
be relied upon. I return to this allegation below.
[9]
After obtaining registration of the property, the applicant attempted
to evict T[....], who refused to vacate the property. In October
2010, T[....] pretended to be the applicant and entered into a
deed
of sale with the first respondent in terms of which she purported to
sell the property to the first respondent for an amount
of R480,000.
It is not disputed that whilst the applicant’s name and
identity number appear on the deed of sale, the deed
of sale was not
completed by the applicant but by T[....], pretending to be the
applicant.
[10]
The property was registered in the name of the first respondent on 15
December 2010 under
Title Deed T44041/2010. Although not dealt with
directly in the papers, it seems clear that the sale price was paid
to T[....],
not to the applicant.
[11]
In the founding affidavit, the applicant makes the following
allegations:
“
8.13 All of the
above who were involved in the transfer and sale of my property were
aware that the sale was fraudulent but continued
with sale and
registration. Even the first respondent was made aware before the
sale and registration was complete but never-the-less
continued with
the sale. The first respondent ended up threatening me that I must
not come to the house any more because it is
his house.
8.14
All the parties to the sale and registration were aware of the
criminal case against their client Emily T[....]
Mnusi because they
were all subpoenaed by the criminal court as witnesses in the fraud
case.”
[12]
In the answering affidavit, the first respondent records:
“
I
do not know whether or not E[....] T[....] Mmusi committed fraud . I
understand
that she was married to the deceased and would have been entitled to
have the property registered into her name by virtue
of the law of
intestate succession
.”
He
does not deny the knowledge alleged in paragraph 8.13 and
records as the only answer to the above allegations:
“
I was aware of the
criminal case against E[....] T[....] Mmusi but I say that a criminal
case has got nothing to do with the alleged
rights that the applicant
alleges that she has.”
[13]
T[....] was subsequently prosecuted in the Regional Court and
convicted on charges of fraud
and theft pursuant to her fraudulent
impersonation of the applicant which led to the conclusion of the
deed of sale. She was sentenced
on 14 June 2014 at the Regional Court
of Boksburg for 8 years, three of which were suspended for five
years.
[14]
Although the details were not before the court, it was common cause
that, since 2010, the
applicant was not supine and has brought two
prior applications claiming the re-transfer of the property –
under Case No.
4535/2014 and 46891/2017. Neither of these
applications was pursued to completion. In the answering affidavit,
the respondent raised
the fact of these other applications and
accused the applicant of abuse of court process, but he did not
expressly plead a defence
of
lis alibi pendens
. In the
replying affidavit, the applicant explained what had happened to
those two prior applications. She recorded that: the attorney
in the
2014 matter “
kept on delaying to proceed
” and then
stopped practising as an attorney; the attorneys in the 2017 action
also did not proceed with the matter despite
her visiting their
offices and enquiring about the process. When she obtained no
assistance from those attorneys she decided to
take the matter to her
current attorneys. In argument before me, respondent’s counsel
confirmed that no defence of
lis pendens
was pursued and that
the respondent accepts that both the 2014 and 2017 applications have
been abandoned.
The disputed issues
[15]
The applicant contends
that the fraud committed by T[....] unravels the deed of sale and the
transfer which occurred in 2010. Relying
on
Legator
McKenna,
[1]
Randalls Bros
[2]
and
Mendelow
[3]
the applicant argued that
the fact of registration in favour of the first respondent did not
result in a transfer of ownership,
because she was the owner at the
time and was not a party to the sale agreement. As the registration
of transfer was pursuant to
this fraudulent underlying sale
agreement, ownership did not pass.
[16]
The respondent did not dispute these cases but sought to distinguish
them on the basis
of a denial that “the applicant had any
ownership right in the property”. This assertion rests on two
grounds. The
first is that, as at the date of divorce in May 1991,
R[....] was leaseholder and not owner of the property and R[....]
only became
the owner in September 1991 (after the divorce) by virtue
of the provisions of section 2 of the Upgrading of Land Tenure Rights
Act 112 of 1991 which converted leasehold rights to ownership rights.
The respondent argues that R[....]’s right of ownership
was
only conferred on him after the divorce and consequently the property
was not available to be distributed in the divorce.
[17]
The respondent also alleges that the applicant defrauded the
Registrar of Deeds and obtained
registration of the property into her
name in 2009 in a fraudulent manner when she represented that she was
the “surviving
spouse”. For this reason, he asserts that
the applicant does not have “clean hands” and therefore
cannot challenge
the ownership of the first respondent.
[18]
There are fundamental
difficulties with the respondent’s approach.
First
,
the transfer of the property to the applicant in 2009 was not set
aside and there is no application before me to have that transfer
set
aside.
Second
,
the Claassen J order confirmed the applicant’s entitlement to
transfer of the property after 2006 and so determined the
rights of
the applicant in relation to the property after R[....]’s
death. R[....]’s executor and T[....] were both
respondents in
those proceedings. The respondent has not sought to overturn the
Claassen J order or to set out any basis on which
it should be
ignored. In the circumstances, where the applicant was entitled to
transfer of the property in 2009 by virtue of the
Claassen J order,
the misdescription of her right in the transfer papers is unlikely to
be found to constitute a fraud on any party,
as no party had a better
right than hers.
Third
,
at the time that the respondent concluded the deed of sale with
T[....] (pretending to be the applicant), the property was registered
in the name of the applicant and the deed of sale and transfer
documents relied upon by the respondent for his rights are documents
which purport to transfer the rights of the applicant to the
respondent. As such, the very rights which the respondent relies upon
are those which he purportedly received from the applicant. He cannot
approbate and reprobate: he cannot resist the relief seeking
to set
aside the transfer to him and assert that he has validly acquired
ownership from the applicant; but at the same time, assert
that the
applicant was never the owner.
Fourth,
the
focus of this matter is on whether the 2010 transfer to the
respondent was valid and there is no dispute that the underlying
sale
agreement on which the transfer was based, was fraudulent.
Fifth
and in any event, the
leasehold right was a right which formed part of the marital estate
in community of property at the time of
the divorce in 1991 and
converted to ownership
ex
lege
later
that year. That leasehold right was registered against the property
and, as pointed out by applicant’s counsel during
argument, was
capable of identification and of forfeiture to the applicant pursuant
to the divorce order.
[4]
The conversion to
ownership would not have changed that position.
[19]
There are two crucial facts which have been established on the papers
and which must inform
the outcome of this matter. The first is that
prior to the transfer to the respondent in December 2010, the
applicant held a real
right in the property. Her right to own the
property was confirmed by the Claassen J order and her ownership of
the property was
registered in the Deeds Office. The second critical
fact is that the transfer of the rights of ownership in the property
to the
first respondent in 2010 was effected pursuant to a fraudulent
deed of sale in which T[....] pretended to be the applicant, as
owner. Aligned to this is the fact that the respondent has not
disputed that he was aware of that T[....] was not the applicant,
and
had misrepresented her identity on the sale agreement, before the
transfer to him took place.
Prescription
[20]
The respondent also raised the defence of prescription, contending
that “
any possible claim that the applicant might have had
has become prescribed in terms of the provisions of Act 68 of 1969.
It seems
that the applicant relies upon
a fraud that was
perpetrated on her and she was aware of all facts relating to such
fraud during 2014 when she brought the first
application. The present
application was only served on me on 1 October 2019, so that any
right that the applicant might have had
has become prescribed in
terms of the provisions of
section 11(d)
of the
Prescription Act 68
of 1969
.”
[21]
The question of whether
the applicant’s claim has prescribed involves a careful
consideration of whether the claim is one
to enforce a real right or
one to enforce a personal right.
[5]
If the claim is one for
rei
vindicatio
,
it does not constitute a debt which is struck by extinctive
prescription and the right to claim re-transfer of the property does
not prescribe after three years.
[22]
In the current matter, the applicant asserts that she was the
registered owner of the property
prior to December 2010 and, as such,
held a real right in the property. No attempt has been made by the
respondent to set aside
the transfer in terms of which the applicant
acquired her real right.
[23]
By claiming cancellation of the transfer to the first respondent and
claiming re-transfer
to herself, the applicant’s claim is a
classic
rei vindicatio
in respect of immovable property and an
assertion of her real right in the property. As such, it does not
constitute a claim for
a “debt” as contemplated in the
Prescription Act 68 of 1969
and is not extinguished by extinctive
prescription.
[24]
In the circumstances, I find that the transfer to the first
respondent was invalid and
the applicant is entitled to set that
transfer aside and to have the property registered in her name again.
Service on Standard Bank
[25]
During argument, counsel for the first respondent raised a question
as to whether service
had been effected on the second respondent,
Standard Bank, as a return of service on Standard Bank did not appear
from the papers
filed on Caselines. Counsel for the applicant
recorded immediately that she had seen proof of service on Standard
Bank and, shortly
after the hearing adjourned, the applicant produced
a copy of the notice of motion, issued by this court on 1 August
2019, on which
a Standard Bank stamp appears. The stamp records:
“
The
Standard Bank of
South Africa Limited
Without prejudice
2019-08-05
Received
by: Mike
[handwritten]
Time:
9:45
[handwritten].”
[26]
Soon after the conclusion of the hearing, the applicant also
delivered two affidavits.
The first, by Lerato Mokapi, which records
that Ms Mokapi is a legal secretary at Masina Attorneys and that she
served the notice
of motion and founding affidavit on the second
respondent on 5 August 2019 at 09h45. She states that the documents
were received
by Michael Mkhize. The second affidavit is by Patuxolo
Sonwabiso Socikwa, a candidate attorney at Masina Attorneys who
records
that on 11 June 2021, she went to Standard Bank to ask for a
confirmation letter from Michael Mkhize that he had affixed the stamp
to the notice of motion on 5 August 2019. She states that Mr Mkhize
refused to give her a confirmation letter and told her that
“
the
signature with the bank stamp is enough and that is the way they do
it”
. He referred Mr Socikwa to his manager.
[27]
Having regard to the above evidence, it appears
prima facie
that
the founding papers were delivered to Standard Bank. However, they
were not delivered by the Sheriff.
[28]
It is obvious that any
person against whom final relief is sought in any legal proceedings
is entitled to receive notice of those
legal proceedings and a court
will not grant final judgment affecting the rights of a party if such
notice has not been given.
Although the court rules require service
of any document initiating application proceedings to be effected by
the Sheriff, this
court has held that non-compliance with the rule
does not necessarily and automatically lead to a nullity if service
was effected
in another manner.
[6]
If the proceedings were
served on Standard Bank and Standard Bank received notice of the
proceedings, then the fact that the service
was not effected by the
Sheriff ought not to constitute an absolute bar to the applicant
succeeding.
Prima
facie
,
the founding papers were delivered to Standard Bank on 5 August 2019
and received by Mr Mkhize in the ordinary course and so Standard
Bank
did receive service of the papers and effective notice of the
proceedings instituted by the applicant.
[29]
However, Standard Bank has not had an opportunity to respond to the
allegations regarding
proof of service. In the circumstances,
although it does mean a further delay to the applicant in vindicating
her rights, I am
reluctant to deliver a final judgment affecting the
rights of Standard Bank without ensuring that it received notice of
these proceedings.
In the circumstances, I intend to issue a
rule
nisi
recording the order which, in the absence of any contrary
fact, I consider should be granted in this application. If, on the
return
day, Standard Bank is unable to dispute the delivery of the
founding papers, the order will become final.
[30]
I make the following order:
(1)
A
rule nisi
is hereby issued calling upon the second
respondent to show cause, if any, to this Court, why the final order
set out in (2) below
should not be granted.
(2)
A final order be granted in the following terms –
a.
The registration of transfer of the immovable property described
as
Erf [....] Ext 9, Marimba Gardens, Vosloorus, in the name of the
first respondent is hereby declared null and void.
b.
Title Deed No. T44041/2010 registered on 15 December 2010 in
the name
of Thulani Cyril Magudulela for Erf No. [....], Vosloorus Ext 9
Marimba Gardens I.Q. Ekurhuleni, Gauteng Division, is
hereby
cancelled.
c.
The Registrar of Deeds, Johannesburg, is directed and
authorised to
cancel the Deed of Transfer T44041/2010.
d.
The Registrar of Deeds, Johannesburg, is directed after cancellation
to transfer the property known as Erf [....], Vosloorus Ext 9 Marimba
Gardens, Ekurhuleni, Gauteng Division, into the name of J[....]
M[....]
.
e.
The Sheriff for the District of Boksburg is authorised to sign
all
documents necessary to give effect to the aforesaid transfer of the
property.
f.
The first respondent is ordered to pay the applicant’s
costs on
a party and party scale.
(3)
The applicant shall procure that a copy of this judgment is delivered
by the Sheriff to
the second respondent, Standard Bank.
(4)
The Registrar shall ensure, if requested to do so by the second
respondent, that the second
respondent and its representatives are
given access to the CaseLines file in this matter.
(5)
In the event that the second respondent wishes to oppose the final
order set out in (2)
above, it shall deliver an answering affidavit
within 15 days of the date of service on it in terms of (3) above.
Such answering
affidavit must include a full explanation of why the
application was not opposed or answered by the second defendant in
2019.
(6)
The applicant may apply to the Registrar to set down the return day
after the 15 day period
referred to in (5) above, has expired.
DA
Turner AJ
28
September 2021
[1]
Legator McKenna Inc v Shea
2010 (1) SA 35
(SCA) at para 21 and 22.
[2]
Commissioner of Custos and Excise v Randalls Bros and Hudson 1941 AD
369
[3]
Nedbank Ltd v Mendelow NO
2013 (6) SA 130
(SCA)
[4]
Nzimande
v Nzimande and Another
2005
(1) SA 83
(W) para 34.
[5]
Absa v
Keet
2015
(4) SA 474
(SCA) para 20 - 25. See also
eThekwini
Municipality v Mounthaven (Pty) Ltd
2019
(4) SA 394 (CC).
[6]
Prism
Payment Technologies (Pty) Ltd v Altech Information Technologies
2012 (5) SA 267
(GSJ) at
272 I-J
and
Investec Property Fund Ltd v Viker X (Pty) Ltd and Another
[2016]
ZAGPJHC 108.