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[2017] ZAGPPHC 126
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Musina Local Municipality v Van der Merwe (A447/2015, 211/2014) [2017] ZAGPPHC 126 (5 April 2017)
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Note:
Certain
personal/private details of parties or witnesses have been
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IN
THE HIGH COURT OF SOUTH AFRICA
(GAUTENG
DIVISION, PRETORIA)
REPUBLIC
OF
S
OUTH
AFRICA
Date
of hearing: 1 March 2017
Case
number: A447/2015
Case
number court a quo: 211/2014
Date:
5/4/2017
In
the matter between:
MUSINA
LOCAL
MUNICIPALITY Appellant
and
PHILLIPPUS
LODEWIK US VAN DER M
ERWE Respondent
JUDGMENT
IN APPEAL
BRENNER,
AJ:
1.
The focal issue in the appeal is whether a binding sale agreement for
the sale of immovable property was concluded between the
appellant,
Musina Local Municipality, ("the Municipality"), qua
seller, and the first respondent, Phillippus Lodewikus
van der Merwe
("van der Merwe"), (also known as "Sippy van der
Merwe"), qua purchaser. Although the registrar
of deeds was
cited as a second respondent, it did not oppose the application.
Other ancillary issues are traversed below.
2.
n the court a quo, in motion proceedings coram Kgomo J, van der Merwe
had successfully secured, inter alia, an order to compel
the
Municipality to transfer the then vacant erven [...] and [...] M.
Extension […] Township ("erven [...] and [...]")
into his name, against payment of a purchase price of R153 900,00.
The order is the subject of this appeal.
3.
In conventional litigation, significant probative value may normally
be attached to ex tempore pre-litigation correspondence.
The issues
in this case called for a detailed analysis of same.
4.
It was undisputed that van der Merwe had run a panelbeating business
in Musina for several years, and had conducted his business
from
portions 7,8 and 9 of erf […] Musina since 1992. These
properties were on the opposite side of erven [...] and [...],
separated by a servitude road.
5.
Erven [...] and [...] were still part of a portion of the Farm M.
4MT, which were required to be excised from the Farm, and rezoned,
and could not be transferred before the establishment of the proposed
M. Extension […] Township.
6.
In 2003, van der Merwe, then 54 years of age, expressed an interest
in acquiring erven [...] and [...]. On 15 September 2003,
he wrote to
the Municipality, the letter being quoted verbatim:
"Mussina
Municipality
MUSSINA
To
whom it may concern
APP
UCATION OF LAND
First
of all I want to thank you for considering my application.
I
hereby apply to buy land from yourself for the extension of plot 788
in the area shown on the attached diagram.
Reason
why I applied for the land:
a)
Visibility to the existing premises building.
b)
Security and easy access to the area. As you know in the tomato
season a lot of trucks deliver their products to
Langeberg Co for
processing and at peak time the trucks wait the whole day, some of
them stays (sic) over night to deliver their
loads. The drivers used
the area for cooking, washing and toilets. I suggest that Langeberg
supply them with the necessary facilities,
and I will in return
secure the area.
c)
If the above area is incorporated, it will be ideal for future
factory development.
d)
All costs for dividing the land will be for our own account. Thank
you for your cooperation.
Yours
faithfully
Sippy
van der Merwe"
7.
On the diagram supplied by van der Merwe, the road servitude does not
form part of the two erven. On this diagram, van der Merwe
had also
mentioned the letters of the alphabet, pre-printed on the diagram,
which described the extent of both properties.
8.1
0n 30 September 2003, the Municipality replied to the
application, on a formal letterhead, in the following
terms:
"Mr
S van der Merwe PO Box 631
Musina
APPLI
CATION FOR LAND
Your
letter dated 15 September 2003 refers.
The
matter was referred to Council and
the following resolution was
taken:
1.
THAT a portion of the Farm M. 4MT and a portion of the road servitude
as indicated on the sketch plan be sold to Mr S van
der
Merwe subject to Section 79(18) of the Local Government Ordinance,
Ordinance 17 of 1939.
2.
THAT the applicant appoints a Town Planner to do the necessary
division of land, road closure and rezoning and that
all costs
incurred in respect hereof be for the account of the applicant.
3.
THAT the applicant be liable for the necessary municipal engineering
costs if required and monthly consumption costs.
Please
confirm your acceptance of the above resolution in order that the
market related valuation be obtained and the objection
notice
published as required by Section 79(18) of the Local Government
Ordinance, Ordinance 17 of 1939.
J
NAUDE
COUNCIL
SUPPORT AND ADMINISTRATION CORPORATE SERVICES"
9.
The "sketch plan" referred to by the Municipality in its
letter is in fact the diagram attached to van der Merwe's
letter of
15 September 2003.In argument before Court, this fact was conceded by
Counsel for the Municipality. In the diagram, the
merx does not
include the road, and is not part of the acute triangle formed by the
combination of erven [...] and [...], as demarcated
by van der Merwe.
10.
On 16 October 2003, van der Merwe wrote to the Municipality, for the
attention of Joy Naude ("Naude"). The letter
was delivered
by hand on 20 October 2003.In it he said:
"Hereby
I, PL
van der Merwe confirm
the
acceptance
of
the resolution
in
your letter dated 30 September 2003."
11.
After obtaining a valuation, the Municipality informed van der Merwe,
by letter dated 13 November 2003:
"Mr
Pl van der Merwe
PO
Box 631 MUSINA
APPLICATION
FOR LAND
Your
letter dated 16 October 2003 refers.
The
market related valuation for the Portion of the Farm M. 4MT and the
Portion of the road servitude has been obtained and is R153
900 VAT
included and is payable on registration.
Please
contact the writer to finalise the necessary Deed of Sale.
J
NAUDE
COUNCIL
SUPPORT AND ADMINISTRATION"
12.
Van der Merwe says that he proceeded to instruct
"all the
necessary
persons
and
institutions
to
proceed
with
all
the
necessary steps
to
effect
township
establishment
of
the
property",
and that he paid all
costs in relation thereto. He even maintained that he provided his
personal particulars to Naude to draw a
deed of sale, and that he
(subjectively) believed he had signed a formal deed of sale at some
stage but could not recall the details.
13.
On 21 July 2005, the Municipality formally approved the establishment
of M. Extension […] Township, subject to various
conditions.
Its technical manager, JAP du Toit, informed the Surveyor General in
a letter of the same date.
14.
In the interim, steps appear to have been taken by Plankonsult,
townplanners mandated by van der Merwe, to prepare the General
Plan
and to submit same to the Surveyor General for approval. Application
was also made for the issue of a section 101 Certificate
by the
Municipality for the opening of the township register.
15.
On 1 October 2006, Plankonsult wrote to attorney Deon Retief
("Retief"), to instruct him to attend to the opening
of the
township register. All relevant documents were attached to their
letter to this end, and Retief was asked to account to
van der Merwe
for his costs. Retief was asked to notify Plankonsult as soon as the
register was opened, so that they could proceed
with the proclamation
of the township.
16.
It is common cause that van der Merwe had engaged the services of
Retief for many years for various matters requiring the services
of
an attorney. When Retief deposed to his affidavit in this matter on
19 February 2014, Retief confirmed that he had known van
der Merwe
for more than twenty years. Retief asserted that it was his firm
which in most instances received instructions to attend
to property
transfers on van der Merwe's behalf. However, he alleges that in
every such transaction, there was a "formal Deed
of Sale".
He asserts that van der Merwe was aware that he had to pay transfer
costs and provide guarantees for the purchase
price and sign transfer
documents, where property was purchased.
17.
According to Retief's affidavit, on 10 October 2006, Dante Moelich of
Plankonsult visited him at his office to deliver the letter
of
1October 2006 to him. On perusing the layout plan and establishment
conditions, Retief observed that the conditions had been
imposed on
the municipality, and this was the incorrect procedure, and "fatally
defective and unusable". The technical
manager of the
municipality, Mr du Toit, instructed Retief to correct the township
establishment process, and Retief attended to
this. He accounted to
the Municipality for his services and was paid by it.
18.
The existence of the instruction to Retief to open the township
register was confirmed by Plankonsult to van der Merwe in their
letter to him of 6 December 2006.
19.
Retief confirmed that he visited van der Merwe in March 2007 to
uplift the General Plan, and was told that van der Merwe had
purchased erven [...] and [...]. Retief states that he was unaware of
the correspondence of September 2003 and October 2003. According
to
Retief, there was a lengthy delay in the township
establishment. This was mainly attributable to the unavailability of
the title deed for the remaining extent of the Farm M. from which the
new portion 71 was to be excised, and due to the insistence
by the
deeds office that consents be obtained from Eskom for its servitudes
not to be made applicable to certain portions of land
referred to in
the township conditions.
20.
At a Council meeting of the Municipality on 20 June 2007, it was
resolved to establish M. Extension […] Township on the
property formerly registered as portion 71 of the Farm M. 4 MT. An
extract from the minutes of this meeting corroborates this fact.
21.
The township register was opened on 17 June 2009.
22.0n
26 June 2009, Retief wrote to Plankonsult. The contents being of
significance, same are quoted below, our emphasis included:
"DORPSTIGTING:M.
EXT […]
Ek
verwys na bogemelde en moet berig dat die dorpsregister op 17 deser
in die Akteskantoor geopen is.
Ingesluit
is afskrif van die gewysigde Stigtingsvoorwaardes waarkragtens
die dorp gestig word en wat ek oak per epos aan u
deursteur vir u
gerief.
Geliewe
derhalwe so qou doenlik te reel
vir die
die olasinq van die nodiqe kennisqewinq
i.t.
v. Artikel
111 van
Ordinansie
1
5
1
1986 in die
Provinsiale
Koecant
sodat
ans
kan
voortaaan
om
die
reeds
verkoote
erwe
te
transeorteer. Ek vertrou dat u oak sal toesien dat al die
bepalings van Artikel 111(2) voldoen word nadat die kennisgewing
gepubliseer
is.”
23.On
7 December 2009, the Municipality wrote to Plankonsult to apprise it
of the opening of the township register on 17 June 2009,
attaching
the approved section 125 plans, and confirming that all
pre-proclamation conditions had been fulfilled, and that the
township
could be proclaimed.
24.The
township of M. Ext […] was proclaimed on 11December 2009, by
local authority notice 370, published in the provincial
gazette.
25.
On 3 December 2010, the Municipality gave its written, in principle
approval to the operation of a truck/bus stop on erven [...]
and
[...]. The approval was subject to the issue of a site development
plan for the buildings, and building plans. It declined
to agree to a
diesel depot but noted that this application had been sent to the
community services and fire departments.
26.On
27 January 2011, the Municipality wrote to van der Merwe concerning
the proposed development, and the need for sewerage connections,
and
the issue of certificates of compliance for new electrical
installations, insecticidal treatment, roof structures, and
occupation.
27.
According to van der Merwe, he proceeded to develop the land at a
cost exceeding R1 million and commenced trading with
the truck stop
in mid 2011. It is axiomatic to record that this occurred with the
full knowledge and consent of the Municipality.
28.
In mid April 2012, van der Merwe called in at Retief's office to
enquire about the transfer of erven [...] and [...],
as he had found
from deeds searches that the properties were still not registered in
his name.
29.
On 19 April 2012, confirming his meeting with van der Merwe,
Retief wrote to the Municipality enclosing the
searches and a
copy of the Municipality's letter of 27 January 2011. Retief stated
that he awaited the signed deed of sale, failing
which, he required
to know the details of the purchase price and whether it was paid in
full. IIf not, he asked for information
to draw the necessary deed of
sale and transfer documents.
30.Circa
October 2012 van der Merwe again asked Retief about the progress with
the transfer. Retief made enquiries with the Municipality
which, on
10 October 2012, sent him correspondence between the parties, stating
that no deed of sale could be found. Retief was
asked whether the
price should be the current value of R922 000,00 and whether van der
Merwe was liable for rates and taxes since
the council resolution.
31.On
11 October 2012, Retief wrote to the Municipality to record his
conclusion that no deed of sale was ever signed. In his view,
a total
value of R922 000,00 for both erven was a fair price, given their
sharply triangular shape, and the dysfunctional effluent
tomato
factory nearby. Retief had been told that
van der Merwe had paid
for
surveying and subdivision costs and the fees of
Plankonsult regarding township establishment. In Retief's
view, these
costs should be quantified and credited against the
purchase price.
32.1
29 October 2012, following enquiries from van der Merwe
concerning the transfer, the Municipality wrote to
him to say the
following, our emphasis included:
"SALE
OF
LAND:
ERF
[...]
&
[...]
M. EXT
[…]
After
investigation of the sale the above stands:
a.
It is clear that the sale transaction applied for and
approved
in
2003
was
never
taken
to
conclusion.
b.
The subdivision was done in 2005 and the township (M.·
Ext [...]) was proclaimed in 2009.
No
Agreement of
Sale
or
copy
thereof
could
be
traced
in
our
records
systems
and
you
as
the
purchaser could
also
not
provide
a
copy
of
the
signed
document. The only
conclusion
is
therefore
that
such Deed of Sale was
never
signed.
c.
You
are
herewith
informed
that
the
current
market
valuation
of
the
erven
is as
follows:
Erf
[...]
R533
000.00 (vat excluded)
Erf
[...]
R389
000.00 (vat excluded)
Kindly
indicate
if
you
are
interested in
purchasing the
erven
at
the
valuation price
to
enable
us to instruct the
Attorneys
to
proceed
with
the
Deed
of Sale."
33.
Attorneys Beukes Sikhala, appointed by van der Merwe, replied to this
missive on 1 November 2012, outlining the exchange of
correspondence
which in van der Merwe's view had culminated in a binding
sale agreement.
34.
The response, per letter of 4 December 2012, was that the parties had
always contemplated the execution of a deed of sale post
the exchange
of correspondence. Because no such document was signed, no binding
sale came into being. The offer to sell the property
at the new
valuations was repeated. Beukes Sikhala asked the Municipality
to keep this new offer open until instructions
had been obtained.
35.On
25 March 2013, van der Merwe wrote to Retief to ask whether Retief
still acted for him. The contents of this letter are important:
"Beste
Deon
Ek
bevestig
dat jy
my
teen
einde
Oktober
2012
telefonies
meegedeel het
dat
daar
volgens
jou geen
geldige
koopkontrak
tussen
myself
en
die
Musina Munisipaliteit
vir
die
verkoop van twee
erwe [...]
en [...]
teen
die gesamentlike
koop
prys
van R153
900.00
tot stand
gekom
het
nie.
Ek
het jou
nog
destyds
opdrag
gegee
om
die dorpstigting
en
oordrag
as
my
prokureur
to
doen
en
het
nooit
jou opdrag
beeindig
nie.
Jy
het
ook
nooit as my prokureur
onttrek nie.
Ek
beoog nou
verdere
regstappe teen
die
Munisipaliteit
en
het
'n
onafhanklike
mening
ingewin
waarvolgens
daar
wet
'n
geldige
kontrak
tot
stand
gekom
het.
Ek
het
nou
'n prokureur
nodig
en
wit graag
bevestig
of
jy
nog
steeds
vir
my
optree of nie, want ek weet nie waar ek staan nie.
Bevestig
asseblief
dringend
skriftelik
aan
my
of
j y
as
my
prokureur
aanbly
of
nie.
Ek
moet
dringend
weet. As
ek
niks
van jou hoar
teen
12h00 op
26
Maart
2014
nie
sat
ek
moet
aanneem
dat jy
onttrek
het
as
my
prokureur
vanaf laasgenoemde
datum."
36.
Retief replied on 26 March 2013 that he had established the township
on the Municipality's behalf and denied ever having acted
for van der
Merwe in regard to the transfer.
37.
Van der Merwe proceeded to engage alternative attorneys, Janse van
Rensburg-Landsberg, who sent a comprehensive letter to the
Municipality on 28 March 2013, recording that van der Merwe was
entitled to transfer of the property against payment of R153 900,00.
38.
As further proof of the Municipality's intention to sell the erven,
van der Merwe attached Musina's municipal valuation roll
for 2012 to
2016 where, at a particulars section, each erf is described as
"Intussen
verkoop
Sippie
van
der Merwe".
39.On
7 January 2014, the application in this case was issued. There is no
return of service on record to indicate when the papers
were served
on the Municipality.
40.
The application was opposed. Of significance is that the deponent on
behalf of the Municipality, Johanson Makondelele
Matshivha
("Matshivha"), the then municipal manager, confirms his
employment with the municipality from August 2006 to
June 2008 as
manager: corporate services. From July 2008 to July 2012 he was
employed by the Limpopo provincial government. He
rejoined the
Municipality in August 2012 and became its municipal manager on 16
December 2012. He states:
".....whereas
the Applicant
seeks
to rely
on
occurrences
which took place
during
the
latter
part
of
2003
for
his
averments
pertaining
to an
alleged Deed
of
Sale
entered
into
by
him
with
the
First
Respondent,
I was
not
employed by the
First
Respondent at
the
time
and
have
no
personal knowledge in respect thereof.
"
41.
The only supporting affidavit relied upon by the Municipality in
its opposition to the application is that of Retief.
42.
There were essentially three issues raised on appeal, namely whether:
a.
the correspondence of September and October 2003 constituted a valid
sale agreement of fixed property, and
whether there was consensus on
the merx;
b.
Naude, the signatory to the letter of 30 September 2003, had the
requisite authority to act as agent for the
Municipality in the sale,
and whether the doctrine of estoppel assists van der Merwe if such
authority did not exist;
c.
Van der Merwe's claim to transfer had become prescribed by the date
that the application was served on the
Municipality.
43.
There are peremptory statutory requirements for the sale of immovable
property to be valid. This in terms of the
Alienation of Land Act, 68
of 1981
, ("the AL Act"), and specifically section 2(1),
which provides:
'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."
44.
It merits mention that section 28 (referred to in section 2(1)), is
of no relevance to the issues as there is no claim
based on a void
sale agreement or a terminated agreement.
45."Deed
of alienation" is defined in the AL Act as
"a document
or
documents
under
which
land is alienated'
Plainly, the legislature contemplated an
agreement which could be signed by way of separate offer and
acceptance, taking the form
of correspondence between offeror and
offeror is not extraordinary in commercial practice for contracts to
be concluded in
this manner, despite the fact that in current
prevailing practice one document is usually signed.
46.
The letter of 30 September 2003 from the Municipality to van der
Merwe constituted an offer to van der Merwe. It addressed all
of the
essentialia of a sale agreement, namely, the identity of the seller
and purchaser, the property, and the price. The price
was
ascertainable and was to be determined by a market related valuation
to be obtained by the Municipality. Van der Merwe unequivocally
accepted the offer in writing. Both such letters were signed, the
Municipality's letter by Naude, and van der Merwe's letter by
him,
personally.
47.
Naude's letter of 13 November 2003 succeeded the conclusion of the
sale agreement. The Municipality's offer letter did not express
that
it was still subject to the execution of a further "deed of
sale". At best for the Municipality, it was an ex post
facto
attempt to unilaterally impose an additional term on an agreement
which was already a fait accompli. Van der Merwe was not
obliged to
accept same. Accordingly, there can be no suggestion of the agreement
being inchoate or non-binding absent signature
of a separate "Deed
of Sale".
48.
The valuation and the subsequent letter to confirm same are
collateral to the agreement, albeit that they evidence the agreed
purchase price. From these facts simpliciter, the offer and
acceptance in this case were made animo contrahendi.
49.
In
Westinghouse
Brake and
Equipment
(Pty)
Ltd
v
Bilger
Engineering
(Pty)
Ltd
1
986(
2)
SA
555
(A) at
page
S74
B-C,
concerning the fixing of a price, the Court held:
"They
may
do so by
fixing
the
amount
of
the price
in
their
contract
or
they
may
agree
upon
some
external
standard
by
the
application
whereof
it
will
be possible
to determine
the price
without
further
reference
to
them."
50.
In
Benlou Properties
(Pty) Ltd v
Vector
Graphic
(Pty)
Ltd
1
993(11
SA
1
79 AD
at
page
1
85
F-G.
the
Court endorsed the following comments by De
Groot 3.19.7 read with 3.14.23:
"I
must confess to considerable difficulty in grasping
why
a price (or rent)
to be fixed by one of the parties
should be regarded
as less certain
than
one
to be determined
by a
third
party.
As
a matter
of
logic,
it is also not clear
to me
why the requirement
that a
third
party
must
act arbitrio
bani
viri
-
as to which see Voet 18.1
.
23 and
Machanick
v Simon
1920 CPD 333
at 336-9
-
should
not also govern
the situation
where it
has
been
left
to
one of the parties
to determine the
price
(or rent)."
51.Finally,
in
Perdikis v Jamieson
2002C6l
SA 3S6 WLD at paragraph S
page
361
I-J:
"Our
law recognises
the
function of
an
expert
who
acts
as
a valuer is
distinct from that
of
an
arbitrator.
The
valuer's
duty is
not to
hear and
determine
a
dispute
but
to
decide
the
questions
submitted to
him
by
the
exercise
of
his judgment
and
skill
without
a judicial
enquiry.
He
does
not
exercise a
quasi-judicial
function.
The
valuer is
not
required to
hear or
receive
submissions
from
either
party.
All
that
is
required
is
that
he
exercise
an
honest
judgment, the
arbitrium
boni
viri."
52.
It is common cause that van der Merwe did not take issue with the
valuation provided by the Municipality's valuer.
53.
Concerning the identity of the merx, the Municipality takes issue
with the fact that the Municipality
had included the road
servitude in the description
of the
merx in its
offer
,
and van der Merwe did not
intend that it should be so included.
54.The
inclusion of the road servitude as part of the merx was a patent
error on the part of the Municipality. One may safely infer
from the
objective facts that the Municipality was in fact intending to
offer
van der Merwe the use of the road servitude and not ownership
thereof. This could not have been otherwise, since, from van der
Merwe's
diagram, to which the Municipality adverted in its
offer
letter, this road was adjacent to several other properties, which
were not the subject-matter of sale, and which gave rights of use
of
the road to various third parties. The established facts indicate
that, objectively, the Municipality did not intend to cancel
the road
servitude and transfer ownership to van der Merwe. Nor was it legally
permissible for it to do so without complying with
other statutory
requirements which did not guarantee its ability to do so, a fortiori
since the right to use of the road affected
various third parties.
55.Counsel
for the Municipality conceded in argument that, consistent with the
Municipality's true intention, (not to sell the road
servitude), its
conditions for the establishment of M. Extension […] (which
formed part of the papers) did not include cancellation
of the road
servitude and the transfer of the land on which it was situate to van
der Merwe.
56.In
Kruger
v
McCallum
1
948
(3)
SA
22
(T).
it was accepted by the Court that parties may agree to the sale
of property which has not yet been completely surveyed
of
f
,
leaving it to the surveyor to determine the boundary to implement
the agreement without further reference to the parties. This is
indeed the case in this matter.
57.Further
indiciae which are consistent with the Municipality's animus
contrahendi are, inter alia, the following:
a.
Apart from the affidavit of Retief,
the Municipality produces
no evidence from
any official within its office, with personal knowledge, who can
directly controvert the assertions made
in van der Merwe's founding
affidavit;
b.
in compliance with and in acknowledgment of its
obligations under a binding agreement,
the Municipality
proceeded to engage a valuer to value the property; this valuation
was accepted by both parties;
c.
in compliance with and in acknowledgment of its obligations under
a binding agreement, the Municipality
proceeded with the
establishment of M. Ext […] Township, and mandated Retief to
this end;
d.
on 26 June 2009, Retief confirmed to Plankonsult that he intended to
proceed with the transfer of the already
purchased erven;
e.
in advance of the transfer, the Municipality permitted van der Merwe
to develop the property, and indeed authorised
the improvements, and
thereafter permitted him to take occupation of same;
f.
on 29 October 2012, the Municipality wrote to van der Merwe in
which it mentioned a sale
transaction which was "applied for and
approved in 2003";
g.
Retief attended to the opening of the township register, with the
result that van der Merwe could legitimately
expect that Retief would
also attend to the transfer of the erven; this was confirmed in
writing by Retief, who never notified
Plankonsult (van der Merwe's
townplanners), or van der Merwe, that his instructions had ever been
revoked;
h.
there is no objective corroboration of Retief's denial that he was
instructed by the Municipality and/or
van der
Merwe to attend to the transfer, nor independent
corroboration for the retraction of his
stated intention on 26 June
2009 to proceed with the transfer, and his communication of same to
van der Merwe.
58.
It is noteworthy that, in the normal course, the seller appoints its
own conveyancer to transfer property but it happens from
time to time
that the seller agrees for the purchaser to engage its own attorneys
to attend to the transfer.
59.
We refer to the defence that the Municipality lacked authority to
conclude the agreement and that Naude was not an agent who
was
authorised in writing, resulting in the agreement being void for
non-compliance with section 2(1) of the AL Act. This is at
variance
with the unequivocal admission in the Municipality's letter of 29
October 2012 (mentioned above), that the sale transaction
was applied
for and
approved
in 2003.
60.This
flies in the face of the incontrovertible fact that the
Municipality's Council had passed a resolution to make the offer,
and
this resolution was recorded on a formal letterhead.
61.
The offer, properly construed, and constituting the reiteration of a
resolution of the Municipality, is signed by the Municipality
per se,
as a party. Naude was simply its signatory, or conduit, who was
conveying the Municipality's offer to van der Merwe. She
is not its
agent stricto sensu. On the inhrenet probabilities, there would have
been an independent resolution, (akin to the resolution
of 20 June
2007 which resolved to establish the township, and which forms part
of the record). Significantly, this was never produced
by the
Municipality.
62.Van
der Merwe's proposal to acquire the erven was addressed to the
Municipality and not to Naude, and the Municipality responded
with
its offer, following its formal resolution, the Municipality having
had both the power and the authority to make the offer.
63.Even
if we are incorrect on the aforegoing, the following is of relevance.
We refer to the "Delegated Authorities"
document provided
by the Municipality as at 30 April 2003. This document was circulated
by Naude, (the same person
who signed the
letter of 30 September 2003), who
would, on the probabilities,
have been acquainted with its contents,
and would have known the limits of her authority.
64.
lt states that the only persons with authority to sign deeds of sale
were municipal manager Abram Ntshavheni Luruli ("Luruli")
or chief technical officer Jacobus Andries Petrus du Toit ("Du
Toit").In substance, at page two of this document,
the municipal
manager was authorised to exercise his delegated powers to designate
Councillors/officials to meetings. (We assume
that "exercise"
is intended to mean "delegate" and that
"designate Councillors/officials"
is intended
to mean "designated", as otherwise the sentence makes no
sense). This much was conceded by Counsel
for the Municipality in
argument.
65.Significantly,
there are no affidavits from Naude, or from Luruli, or du Toit to
support the Municipality's contention that Naude
had no written
authority to make the offer, delegated or otherwise, assuming
that this was required.
We are at liberty, therefore, to
draw an adverse inference from this omission, namely that, de facto
and de lege, Naude was authorised
to sign the offer letter.
66.
ln the light of the above, there is no need to deal with van
der Merwe's defence of estoppel.
67.We
refer to the issue of prescription. In its opposing affidavit, the
Municipality alleges, in one discrete paragraph, and in
bald and
vague terms, that the right to claim transfer has become prescribed.
It fails to assert when the obligation to give transfer
became due,
and when it became prescribed.
68.
ln reply, van der Merwe contends that prescription has not commenced
to run because he cannot demand transfer before the necessary
engineering services have been installed, and same have not been
installed. He proceeds to assert that, in any event, the first
time
he was made aware of the Municipality's volte face was when it
repudiated its obligations in its letter of 29 October 2012.
The
application was served in January 2014, according to his affidavit.
69.Moreover,
there had been several acknowledgments of the duty to give
transfer from time to time, and such acknowledgments
had interrupted
prescription.
70.In
the offer letter dated 30 September 2003, it is expressly stated that
van der Merwe would be liable for “
the necessary
municipal
engineering
costs if required
.”
In the opposing affidavit of the Municipality, deposed to by
Johnson Makondelele Matshivha, concerning engineering services, he
says the following, our emphasis included:
"As
appears from annexures PL2 and PLS to
Applicant's
Founding Affidavit
it was
also
a
condition of the
proposed sale that
the
Applicant would
have to
pay
to
First
Respondent
a
further
amount
as
contribution
towards installation
of
the engineering
services.
The
words
"if required"
in
the letter
PL2
can in
my
view
only
relate
to
the possibility
of services
not
being required in
the
event
of
the
land
being consolidated with
an
already serviced erf.
Section
113(2)
(c) read with
116
of
Ordinance
15
of
1986
prohibits
the
transfer
of
erven
in a township without
installation
of
the
necessary
services.
I have
been
advised
by
the Technical Manager and believe that such contribution would
have been substantial as inter alia for the supply of electricity
to
the two erven and twelve Business erven in M. Extension 13
and
14
a new electrical power mainline had to be
constructed over a distance of more than four kilometres.
"
71.PL2
is the offer letter and PLS is the internal Municipality memorandum
containing manuscript comments from two officials regarding
the
viability of selling the erven.
72.While
confirming that he has been paying for electrical consumption
associated with his occupation of the erven, van der Merwe
makes the
following concession:
"I
concede that it appears from annexures "PL2" and "PL5"
that I would have had to pay the costs with relation
to the
Town-Planning Scheme and a contribution for municipal engineering
services, if required.
I
state that I have never been requested or required to pay
any contribution towards engineering services.....I would
have been
able, willing and prepared to pay any such reasonable amount, if and
when I was requested to do so...........
Insofar
as the First Respondent may refuse to transfer the erven due to the
non-installation of services, I respectfully submit
that the wording
of prayer 1 of the Notice of Motion is wide enough to include an
order to the effect that the First Respondent
must install the
necessary services."
73.Section
11(d) of the Prescription Act, 68 of 1969 ("the
Prescription
Act"
;) provides for the statutory extinction of a debt other than
debts defined in
sections 11(a)
, (b) and (c) within three years.
Prescription begins to run as soon as the debt is due. (Vide
section 12(1)
of the
Prescription Act.)
74.
t
is trite that a "debt" does not refer to a cause of
action but rather to a claim. See
Drennan Maude
and
Partners
v
Town Board
of
the
Townsh
i
p
of Pennington
1
998C3l SA
200 (SCA) at 2
1
2
G-I.
75.
The phrase "debt due" in
section 12(1)
was described in
De
l
oitte
Haskins
& Sells
Consultants
(Pty)
Ltd
v
Bowthorpe
Hellerman
peutsch (Pty)
Ltd
1
991
C
l
l
SA
525
(AD) at 532 H-I
as:
"This
means that there has to be a debt immediately claimable by the
creditor or, stated in another way, that there has to
be a debt in
respect of which the debtor is under an obligation to perform
immediately .....It follows that prescription cannot
begin to run
against a creditor before his cause of action is fully accrued, i.e.
before he is able to pursue his claim."
76.Accordingly,
on the Municipality's own version, van der Merwe's claim to take
transfer will not become due until the installation
of the
engineering services contemplated in the Municipality's offer letter.
This is dispositive of the prescription point.
77.In
all the circumstances, we are satisfied that van der Merwe is
entitled to take transfer of erven [...] and [...], in conformity
with the terms of a valid agreement of sale concluded on 16 October
2003.
78.In
terms of
section 19(d)
of the Superior courts Act, 10 of 2013, the
Appeal Court may confirm, amend or set aside the decision which is
the subject of
appeal and render a
decision which the circumstances may
require.
79.
Since the purchase price is not yet due, there was no
warrant for the order at paragraph 2 escalating
the price by 10°/o from 1October 2003 to 29 October 2003.
Nevertheless, Counsel for van der Merwe conceded in argument
that
this part of the order should stand inasmuch as there was no
cross-appeal.
80.Concerning
the installation of engineering services, Counsel for van der Merwe
was satisfied that van der Merwe had other remedies
at his
disposal to invoke the rights afforded to him thereby.
81.There
is only one practical issue which falls to be addressed in the light
of this appeal, and this is the deadline date by which
the transfer
should be effected. The date should commence to run from the date of
delivery of this judgment. To this extent, the
amendment of the order
is justified.
82.The
appeal being unsuccessful, costs must follow the result. Both parties
engaged Senior Counsel, and accordingly, the costs
of one Senior
Counsel are justified.
83.The
following order is granted:
a.
The appeal is dismissed;
b.
the appellant is directed to pay the costs of the appeal, including
the costs of Senior Counsel;
c.
the order of the court a quo dated 12 February 2015 is amended to
read as follows:
"1.
The
first
respondent is
hereby ordered to,
within
60
(sixty) days
from
the
date
of
delive
r
y
of
the
judgment
by
this Court
.
take
all steps, sign
all documents,
and
do all
things necessary
in order
to have
the property
known as Erf
[...] and Erf
[...] M.
Extension
[…], made
up
of separate
erven
or
being one consolidated property,
transferred and registered into the applicant's name against payment
of the amount of R153 000,00
payable on the date of transfer;"
____________________________
T
BRENNER
ACTING
JUDG E OF TH E HIG H COURT OF SOUTH AFRICA
GAUTENG
DIVISION, PRETORIA
1
4
March
20
1
7
We
agree.
____________________________
P
RABIE
J
UDGE
OF TH
E
HIGH
COURT
OF SOUTH
AFRICA
GAUTENG
DIVISION, PRETORIA
____________________________
R
TOLMAY
J
UDG
E
OF TH
E
HIGH
COURT OF SOUTH
AFRICA
GAUTENG
DIVISION, PRETORIA
It
is so ordered.
Appearances
For
the Appellant:
Adv AJ Lauw SC
Instructed
by:
Friedland Hart Solomon Nicolson
Counsel
for Respondent:
Adv C A da Silva SC
Instructed
by:
Christo Coetzee Attorneys