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[2016] ZAGPPHC 926
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Slip Knot Investments 777 (Pty) Ltd v Martycell Properties CC (55004/2012) [2016] ZAGPPHC 926 (30 September 2016)
IN
THE HIGH
COURT
OF
SOUTH
AFRICA
(GAUTENG
DIVISION,
PRETORIA)
CASE
NO:
55004/2012
DATE:
30/9/2016
IN
THE MATTER B
ETWEEN:
SLIP
KNOT INVESTMENTS
777
(PTY) LTD
Applicant
AND
MARTYCEL
PROPERTIES
CC
Respondent
JUDGMENT
KOLLAPEN
J:
1.
The trial in this matter
was set down for the
9
th
of May
2016
and was scheduled to
conclude on the
20
th
of May
2016
following a directive
issued by the Deputy Judge
President of
this
Division.
Following a
directive issued
by
me
in
my capacity
as
the
designated
Case
Manager
on
the
22
nd
April
2016,
the
respondent
(the
defendant
in
the main action),
launched proceedings
seeking an order
to
the effect
that a
Judge in
chambers did
not
have
the
jurisdiction
to issue
an
order
that
limited
the
rights
of access
by
a party
to
inspect
documents and obtain
copies thereof,
alternatively
that
in the event it be
found that a Judge in
chambers
had
such jurisdiction,
then
the
directive
of the
22nd
of
April
2016
unreasonably
infringed
the rights
of the defendant to a
fair trial.
2.
The
applicant opposed
the
application and
instituted a
conditional
counter- application
in
which
it
sought
relief
in the
event
of the main
application
being granted
and/or
any
delay
eventuating
in the
conclusion
of the trial
set
down to commence on the
9
th
of May
2016 .
3.
In such event the relief
sought
in
the
conditional
counter-claim
is the
following:
1.
That th
e
judgment
granted
by the Honourable Judge Prinsloo on 11
June
2013
under
case
number 51915
1
2012
be
varied
by
the
addition
of
the following order:
1.1
Tha
t
pending finalization
of
the action instituted under case no 55004
1
12 ("the
main action"):
1.1.1
The
defendant
is
ordered
to pay
or
to
ensure payment of
the
net rental income
as
described
in
this
order
("the
net
rental
income'') earned
during
any particular
month
by the last day of that month
into
the
interest
bearing
trust
account
of an
independent firm of
attorneys, being [to be identified by the court or agreed upon by the
parties];
1.1.2
That the
term
"net
rental
income"
referred
to
in paragraph 1.1.1 will
mean
the
following:
1.1.2.1
All income of any nature whatsoever earned from the properties
described as Erven 316 and 317, Clarina, Extension 19, Registration
Division JR, Province of Gauteng ("the properties'');
1.1.2.2
Less all rates, taxes, costs in respect of water and
electricity consumption, refuse removal and other imposts,
maintenance costs,
management agent fees and any other reasonable
costs arising out of any obligation to any tenant in particular in
terms of any
lease agreement and any common law duty to provide
peaceful and undisturbed possession to any tenant ("the
expenses'');
1.1.3
"owners' statements reflecting the detail of all income
in respect of the properties and all expenses and accordingly the
calculation
of the net rental income will be provided by no later
than the end of each month in respect of each payment of net rental
to the
plaintiff's attorneys and to the independent attorney;
2.
That the defendant pay the costs for this application,
including the costs of two counsel.
4.
The dispute in so far as it related to the main application
was resolved between the parties resulting in a consent order being
made an order of Court on the
9th
of May 2016.
However it became evident that the trial would not conclude within
the time allocated and the plaintiff proceeded with
the counter
application which had become opposed and which was then argued on the
15th
of June 2016.
5.
In order to understand where and how the interim relief sought
fits into the broader dispute between the parties, it may be
necessary
to provide some background to both the key features that
characterise the dispute the parties are engaged in and then to
provide
some detail of the history of the litigation between the
parties to the extent that it is necessary for the purpose of
adjudicating
this matter.
The
nature of the dispute between the parties
6.
It
is
common
cause
that
the
defendant entered
into
an
agreement
to
purchase the
properties
known
as
Erven
316
and
317
Clarina
Extension 19 Registration
Division J
R
Province Gauteng ('the
properties')
and
that the
plaintiff
advanced
or
caused
to be
advanced
to the
defendant
the
sum
of R49,5
million for
the
purpose of
paying the
purchase consideration
and
obtaining
transfer. This duly happened.
7.
It
is
also common
cause
that on the 28
th
of April
2008,
what has been
described
as
a
letter
of
intent
was
signed
between
the
parties.
It
sets
out
inter
alia
the terms
of the
intended
loan
agreement
to be
concluded,
the
interest
to be attached
to the
loan
as well
as how
the parties
would
share in the profits
of the sale
of
the
property upon it
being sold.
The letter of
intent contemplated
a Memorandum
of
Agreement
being
entered into between the
parties to give effect
to
the
terms
of
the
letter
of
intent
but
this
never
occurred.
As
I understand it
the
relief
sought
in
the
main
action
between
the
parties
by
the plaintiff
is
for
an
order
of
repayment
of
the
loan
together
with
interest
which the plaintiff
alleges became
due one hundred
and twenty
days
after the grant
of the loan
8.
The defendant, while
admitting
its signature
on the letter of intent
contends that it
signed
the
letter
of
intent
under
duress
in
that
the
plaintiff
took
the
position that
the
guarantee
in respect
of
the
purchase consideration
that
the
defendant was
required
to
deliver
to
acquire
the
property,
would
only
be
made
available against
signature of the letter
of intent.
9.
Its stance is that it entered into an oral agreement with the
plaintiff in terms of which the plaintiff would make available to it
the sum of R49.5 million to purchase the properties, that the
defendant would sell the properties as soon as reasonably possible
and that the parties would divide the net profits on the basis that
the plaintiff would receive 60% of the net profit and the defendant
would receive 40%.
10.
The financing to purchase the property was provided in part by
the plaintiff and in part by Investec from whom the plaintiff secured
a loan in the sum of R35 million in return for which Investec caused
a mortgage bond to be registered over the properties. In addition
the
defendant signed a suretyship in favour of Investec in respect of the
indebtedness of the plaintiff arising out of the loan.
The balance of
the purchase consideration of Rl4.5 million was put up by the
plaintiff from its own resources.
11.
Fallowing the transfer of the property into the name of the
defendant the net rental income derived from the property was paid
over
by the defendant to the plaintiff. This commenced in or about
August 2008 and continued until May 2012 and the total sum of some
R27 million was paid over during this period.
12.
Late
in
2011,
Investec, as it was entitled to, called up the loan it had made to
the plaintiff and in response thereto the plaintiff paid
the sum of
approximately R29 million to Investec being the then-outstanding
balance on the loan. The bond registered over the property
in favour
of Investec was cancelled and it appears that the defendant
thereafter discontinued paying over the net rental income
resulting
in the issue of summons in the main action.
It
is not in dispute that the defendant continues to derive
rental income from the property in excess of R1 million per month and
that
it has retained for itself those monies from about June 2012
until the present time.
13.
The parties offer different reasons as to why the rental
income in respect of the property was paid over to the plaintiff. The
stance
of the plaintiff was that in return for it agreeing to hold
over the repayment of the capital amount and interest on the loan due
by the defendant, the defendant agreed to pay over the net rental
income. The defendant on the other hand takes the position that
it
made those payments voluntarily while it was at risk in respect of
the bond over the property and the suretyship it signed and
that once
the bond was cancelled, its exposure had ceased and it stopped making
the payments.
14.
In summary the plaintiff in seeking the relief in these
proceedings contends firstly that it has a right to payment of the
loan
amount together with interest which it estimates to be in excess
of R80 million at the current time.
In
addition
it argues that as long at the capital and interest remains
outstanding, it is entitled to receive the net rental income.
It is
on this basis that it advances its case for interim relief.
15.
The defendant on the other hand denies the existence of a loan
agreement contending that what occurred was an investment agreement
and that the plaintiff is only entitled to payment upon the sale of
the property. In addition it contends that the net rental payments
were only made while it was at risk and accordingly the plaintiff has
no right to such payment.
16.
While the property is currently occupied it appears that it is
on the basis of a monthly tenancy, there being no written lease
agreement
for a fixed period. In
addition
the property
has
not
been
sold
and
there
are
no offers pending
or
any
negotiations
underway
for
its alienation.
The
litigation
between
the
parties
17.
In about September 2012, the plaintiff
launched
an
application
out of this Court
seeking
interim
relief pending
the
institution
of
an
action that would
inter alia
interdict
the
defendant
from
cancelling
the
bond
over
the
property
with
Investec
and transferring
or
encumbering
the property.
The matter
served
before
PRINSLOO
J
who
was
of
the
view
that
'some
protection ought
to
be
granted
to the
applicant
in the
form
of interdictory
relief.
He ultimately
granted
an order interdicting the defendant
from encumbering
the
property,
and
ordered
that
in
the event of the
sale of the
property,
the
defendant
was
directed
to
pay
the
sum
of
R50
million
into
an
interest-bearing
trust
account.
He
also
directed that an
appropriate
caveat
be
registered
against the
property.
18.
The main action was enrolled
for
trial
during September 2014 and served
before
me.
The
trial
did
not
proceed,
the
Court
acceding
to
a
request
by
the
defendant
for a postponement.
The
issue
that
triggered
the request
for
a postponement
was
the
defendant's
request
to
have
access to the
financial
statements
of
the
plaintiff.
In
granting
the
postponement
I
took
the
view
that
the conduct
of the defendant
was unreasonable
in
how
it responded
to a suggestion
by
the plaintiff
to
allow
access upon
certain terms
and
conditions.
I
also expressed the view that had the defendant not
summarily
rejected
the offer by the plaintiff
but
engaged
with
it, the
issue
could
have been
resolved
and the trial
could
well
have proceeded.
Under those circumstances I ordered
the defendant to pay the costs occasioned
by the postponement.
19.
The
matter
was
thereafter
enrolled
for
two
weeks
commencing
on
the
9th
of May 2016 and I was
appointed as case
manager. I issued a directive on the 22nd of
April
2016
that sought
to
regulate the
defendant's access
to
documents it sought in
the
possession
of
the
plaintiff. In
doing
so
my directive
included conditions
pertaining
to
confidentiality,
which
prompted
the
launch
of an application
which
was
enrolled
for
the
9th
of May
2016
(the
first
day
of trial) seeking
a
declaratory
order
relating
to
the
legality
of the
directive.
That application
triggered the
counter-application
and
as
previously indicated the
main
application
was
resolved
in
terms
of
a
consent
order
made
on
the
9th
of May 2016.
20.
The ten
days that
were
allocated
for the hearing
of the
matter
were
taken
up
in the following manner:
a)
The order of the 9th of
May 2016 which
dealt
with the
logistics
of access to
the plaintiff
s
financial
statements provided
that the matter would
stand
down
provisionally
until
the 11th
of
May
2016.
The
order
also provided for
the
hearing of
the
conditional
counter-application
by
no later than the 20th of May 2016.
b)
On
the 10th
of
May
2016
the
parties
agreed
that
the
defendant
would revert
to
the
plaintiff
by
14h00
on
the
11th of May
2016
on
any
issues arising
out
of the
inspection.
The matter
did
not
proceed
on
the
11th of May 2016.
c)
On the 12th of May 2016 the parties met me in chambers and the
defendant indicated it would be ready to proceed with the trial
on
the 13th of May 2016 at 9h00 and that it would deliver its amendment
to its plea by 16h00 on the 12th of May 2016 introducing
a special
plea.
d)
On the
13th of May 2016 and
after the amendment
was
filed, the
issue of the
special plea
being
dealt with
as a separated
issue
arose
and the
court after
hearing
argument
on
the
matter
ordered
that
it
be
dealt
with
as
a separated
issue.
The trial
in respect
of the
separated
issue was
ordered to commence on
the
16th
of May 2016.
e)
On the morning of the 16th of May 2016, the defendant gave notice
that it intended to bring a substantive application for my
recusal.
The rest of the week was taken up with the exchange of affidavits and
the hearing of the recusal application on the 19th
of May 2016.
f)
On
the
20th
of
May
2016
the
Court
dismissed
the
recusal application. The
defendant
then
brought
an
application
to
strike
certain
matter
from the
plaintiff
s
replying affidavit in
the
counter-application.
The
matter was
argued
and
an
order was
made.
By
then
it was
too
late in the
day to hear
the
counter-application
and
a
date
was agreed
upon between the parties
resulting
in the postponement
of the hearing
of the counter
application to the
15th
of June 2016.
21.
The
consequence
of
all
of these
events,
interventions
and
applications
was
that the trial
in the matter
was postponed
and
a date
for the
hearing
of the matter
is
still to be
allocated.
It
is not clear when this will occur and when the matter will be
re-enrolled.
It
is
against this background that the application for interim relief
stands to be adjudicated. In advancing the case for the relief
it
seeks, the plaintiff contends that:
a)
The circumstances that prevailed when the order of PRINSLOO J was
granted on the
11th
of June
2013
have changed and justify the need for the variation of the
order.
b)
That the changed circumstances justify and support the need
for the grant of the interim relief it seeks.
I will
deal with these issues and in doing so will also deal with whether
the requirements for the grant of interim relief have
been satisfied.
Have
circumstances changed
that
justify a
reconsideration
of
the
order
of
PRINSLOO J?
21.
At the time the matter served before PRINSLOO J it was
certainly in the contemplation of the parties that a trial date was
likely
to be allocated shortly. As things transpired a date was
allocated for the
12th
of September
2014
and I have already dealt with the circumstances that resulted in the
postponement of the matter then. Three years have passed since
the
order of PRINSLOO J and there is no indication as to when the matter
will proceed to trial.
22.
At the time of the order of PRINSLOO J the occupation of the
property was not regulated by a written lease agreement but it
appears
that the defendant was awarded a tender in April 2014, but to
date no lease agreement has been concluded and it is unclear whether
such an agreement will be concluded. The defendant points out that it
will be required to refurbish the property at a cost of R3
million to
secure such a lease but in any event it appears uncertain at best
whether a lease under any circumstances will be concluded.
22.
In
May
2013,
the
defendant
was
of
the
view
that
the
sale
of
the
property
was 'overwhelmingly
probable'
and
was in
the final
stages
of
being finalised. A
sale was,
however,
not
concluded
and
it
does
appear that
the prospect
of
a sale at
the
current
time
is
even
more
elusive.
The
defendant
states,
probably correctly
so, that without
a written
lease
for a fixed period,
potential
purchasers would not
invest in
the
properties concerned.
The
consequence of
this
must also necessarily
mean
that the value
of the property,
in the absence
of a written lease, would
have
diminished
as
opposed
to
the
situation
in
May
2013
when
a sale was imminent.
23.
The
above
does,
in
my
view,
indicate
that
the
circumstances
that
now
prevail are considerably
different
from those that prevailed
in June 2013
and that
if the plaintiff
is ultimately
successful,
its ability to recover
what
may
be
found
to be due
to
it
will
certainly
be
impacted
upon
by
these
circumstances.
In
my
view they justify
at the very
least a reconsideration
of the order made by
PRINSLOO J.
24.
In
ZONDI
v
MEC
TRADITIONAL AND LOCAL
GOVT
AFFAIRS
2006
(3)
SA
1
(CC)
the Court expressed
itself in the following
terms with regard to the
power
to
vary
interlocutory orders:
"Simple
interlocutory
orders stand
on a different
footing.
These are
open
to
reconsideration,
variation
or
rescission
on good
cause
shown.
Courts
have exercised
the power
to
vary
simple
interlocutory
orders
when
the facts
on which
the
orders were
based
have
changed
or where
the
orders were
based on
an incorrect
interpretation
of
a
statute
which only became
apparent later.
The
rationale for
holding
interlocutory
orders
to
be
subject
to variation
seems
to
be
their
very nature.
They do not
dispose
of
any
issue
or an
y
portion
of the
issue
in the main
action.
"
The
application
to strike
25.
Before dealing with the relief sought, I need to provide
reasons for the order made on the 20th of May 2016 in respect of the
application
to strike.
The
application to strike was premised largely on the complaint that the
replying affidavit contained new matter, contained legal
argument,
vexatious matter, and attacks on credibility. My view is that apart
from the matters dealt with in paragraph 31 of the
affidavit (which
clearly on the face of it dealt with developments since the launch of
the application, was new matter and warranted
an opportunity being
given to the defendant to respond), the other matters complained of
were not objectionable. Paragraphs 7 to
30 dealt with the urgency of
the matter and given that it was in the contemplation of the parties
that the matter was to be argued
by no later than the 20th of May
2016, I do not consider these paragraphs as necessarily new in that
sense. Insofar as the other
paragraphs under attack are concerned my
view is that there was no proper case made out to strike and the only
prejudice in totality
which the defendant may have been justified in
complaining about was the contents of paragraph 31. In this regard an
order was
made on the 20th of May 2016 affording the defendant the
opportunity to respond thereto.
I now
proceed to deal with the requirements that have to be established
before the Court may grant interim relief
The
requirements for interim relief
I.
A
prima
facie
right (even
one
open to some doubt)
26.
When one has regard to the factual matrix then the following
facts are not in dispute:
i.
The plaintiff has to date paid approximately R43.5 million
which was used to acquire and then secure the property, being R 14.5
million at the time of the sale and a further approximately R30
million to settle the Investec bond.
ii.
The defendant did not make any payment
in
respect of the purchase price at the time the property was
acquired.
iii.
Despite what appears to have been the common contemplation of
the parties that the property would be resold, some eight years later
the property remains unsold and the prospect of a sale in the near
future remains at best uncertain.
iv.
During the period August 2008 until May 2012 the defendant
paid the net rental income derived from the property over to the
plaintiff.
The total amount of such payments was R27 million.
v.
From June 2012 until the present time, the defendant continues
to receive and retain all rentals received in respect of the
property.
27.
It is clear that even on the defendant's version the plaintiff
would upon the resale of the property become entitled to the purchase
consideration it laid out together with its share of the profits
thereon. This amount would have been R49.5 million at the time
the
property was acquired. Even if one does not consider for now the
question of interest which the plaintiff says would have accrued
on
that amount, then the inescapable mathematical conclusion is that the
plaintiff would be entitled to payment. The amount of
the payment due
to it is in dispute and while the stance of the defendant is that the
R27million it paid over four years should
be deducted from the
capital amount, it does appear from the defendant's own version that
it paid these monies as it was on risk
(having signed a suretyship in
favour of Investec) and that it 'paid as much as it could to settle
the indebtedness to Investec'.
In my view it would have been apparent
to the defendant that its risk or exposure was in respect of the
capital and interest of
the Investec loan, that the monies it paid to
the plaintiff for onward payment to Investec was to be utilised to
pay the capital
and interest of the Investec loan, and therefore in
my view its stance that such payments were intended to reduce the
amount of
R49.5 million is not consistent with its own version as to
why it paid the net rental income.
28.
In
GOOL
v
MINISTER
OF JUSTICE
1
955 (2) SA 682
(C)
, the Court accepted, with
some qualification, the approach adopted in
WEBSTER
v
MITCHELL
1
948(1) SA
1
1
86 (W)
wherein it was held that:
'In
an application for
a temporary
interdict,
applicant's
right need
not
be
shown
by a
balance
of
probabilities; it is sufficient
if
such
right
is prima facie
established,
though open to
some
doubt. The
proper
manner of approach
is to take the
facts
as set out by
the applicant
together
with any
facts
set out by the respondent which applicant cannot dispute and to
consider whether, having regard to the inherent probabilities,
the
applicant
could on
those facts
obtain
final
relief
at
a
trial. The facts
set up
in contradiction
by respondent should then be considered, and
if
serious doubt is thrown upon the case of the applicant,
he could not succeed.
'
29.
When
I
apply
the
test
to
the
factual
matrix
that
I
have
outlined,
even
on
the undisputed facts,
namely
the
monies
advanced
to
acquire
the
property
and
the obligation
to repay
it
as well
as the
conduct
of the defendant
in paying
over the net
rental
income
for
about
four
years,
then
I
am
satisfied
that
the plaintiff
has established
the
existence
of a
prima facie
right.
In addition
it warrants
mention that
the
interim
relief
that
was
granted
by
PRINSLOO
J
could
only
have
been premised
upon
him being
satisfied
as to the existence of a
prima facie
right.
I
I
.
A
well-grounded
apprehension of irreparable harm
if
the relief is not granted
30.
In
NATIONAL
COUNCIL OF
SOCIETIES FOR
THE
PREVENTION
OF CRUELTY TO
ANIMALS
v
OPENSHAW
[2008] ZASCA 78
;
2008
(5)
SA
339
(SCA)
the
Supreme
court
of Appeal
in
dealing
with
this
requirement
captured
it
as follows:
"The
test
in
regard to
the
second requirement
is
objective
and the question
is whether
a
reasonable
man,
confronted
by
the
facts,
would
apprehend
the probability of
harm.
The following
explanation
of
the meaning
of
'reasonable
apprehension' was
quoted
with
approval
in
Minister
of Law
and
Order
and
Others v Nordien
and Another
(1987
(2) SA 894
(A)):
A
reasonable apprehension of injury has been held to be one which a
reasonable man might entertain on being faced with certain facts.
The
applicant for an interdict is not required to establish that, on a
balance of probabilities flowing from the undisputed facts,
injury
will follow: he has only to show that it is reasonable to apprehend
that injury will result. However the test for apprehension
is an
objective one. This means that, on the basis of the facts presented
to him, the Judge must decide whether there is any basis
for the
entertainment of a reasonable apprehension by the applicant."
31.
On what is before me, I must have regard to the reality that
the property has not been sold after eight years, and that there is
no written lease which in the defendant's view, makes a possible sale
even more elusive. This must impact on the value of the property
and
if the plaintiff is ultimately successful would the recovery of what
may then be due to it be impossible or improbable?
32.
Whatever the value of the property may be it appears that
attempts to sell it at for as low R70 million have not been
successful.
There must thus, objectively speaking, be a real risk
that the resale of the property may well bring in an insufficient
yield to
cover what the plaintiff may be entitled to in respect of
the capital and interest of its claim. Beyond the proceeds of the
sale,
it also does not appear that the defendant is possessed of any
other assets or income to enable it to satisfy such a claim.
33.
In these proceedings the defendant takes the position that it
does not have the resources to cushion non-payment or late payment
by
its main tenant and in addition it does not have the estimated R3
million required to refurbish the property. Against that,
and if one
has regard to the financial statements of the defendant for the
period 2010 to 2014 it reveals a total income of some
R43 million. It
is not clear what had happened to the profits generated from largely
the property over the past few years and the
defendant has not
furnished any explanation in this regard. That being the case this,
in my view, is another factor which contributes
to my conclusion that
indeed there is a well-grounded apprehension of irreparable harm if
the interim relief is not granted.
III.
The balance
of
convenience
34.
What is sought to be preserved is the profit that is being
earned every month from the property - in reality what prevailed for
the period August 2008 to May 2012. When in addition I have regard to
the defendant's version that the true transaction between
the parties
was in the nature of an investment, then on what is before me, the
defendant has already (from May 2012 to the present)
derived the
benefits of the arrangement without having paid any monies from its
own resources (the R27 million being rental income)
while the
plaintiff on the other hand has laid out at least R43.5 million from
its own funds and is yet to see any benefit from
the investment .
The
balance of convenience favours the granting of the relief.
No
alternate remedy
35.
There is no alternate remedy which is available to the
plaintiff.
The
relief
36.
My
view
is
that
the
net
rental
income
should
be
preserved
pending
the finalisation
of
the
trial.
That
income
should
be
arrived
at
by
taking
the
gross rental
income received
and deducting
all the reasonable
and necessary
expenses associated
with
the
property.
This
would
include
the
payment of
services
and rates,
insurance,
security and general
maintenance.
37.
Beyond
the
expenses
associated
with
the
property,
the
defendant
has
an obligation
towards
the
South
African
Revenue
Services
('SARS')
in
respect
of arrear
tax
and
will also
be required to
pay provisional tax
twice a
year (in August
and February)
as well
as Value
Added
Tax.
These
amounts
should
also be paid
from the net rental
income.
Costs
38.
Reserving
costs
for
future
determination
may
be
the
most
appropriate
order
to make.
If
the
plaintiff is
ultimately
successful it
may strengthen its
claim for costs in
respect
of
this
application
and
likewise
on the part
of the defendant
if it is to emerge
with
a successful
outcome
in the main
action.
I
accordingly
intend to reserve
costs.
39.
ORDER
It
is
ordered:
1.
That
the judgment granted
by
the
Honourable
Judge
Prinsloo
on 11
June
2013
under
case number
51915/2012
be
varied
by
the
addition
of the following order:
1.1
That pending
finalization
of the
action
instituted
under
case no
55004/12 ("the
main
action"):
1.1.1
The
defendant is
ordered
to
pay
or
to
ensure
payment of
the net rental
income
as described
in this
order
("the
net
rental
income")
earned during any
particular
month
by
the
last day
of
that
month
into
the interest
bearing
trust
account
of an
independent
firm
of
attorneys,
being Adams
and Adams
Attorneys
(Pretoria);
1.1.2
That
the
term "net
rental income"
referred to in
paragraph
1.1.1 will
mean
the
following:
1.1.2.1
All
income
of any
nature
whatsoever
received
from the properties
described
as
Erven 316 and 317,
Clarina, Extension
19,
Registration
Division
JR, Province
of Gauteng
("the properties");
1.1.2.2
Less all rates,
taxes,
costs
in respect
of water
and electricity
consumption,
refuse
removal
and
other
imposts,
maintenance
costs, management
agent
fees and any
other reasonable
costs arising out of any
obligation to
any
tenant in
particular in
terms of
any
lease
agreement and any common
law
duty
to
provide peaceful
and
undisturbed possession
to
any
tenant
("the
expenses");
1.1.3
Owners'
statements
reflecting
the
detail
of
all
income
in
respect
of the properties
and
all expenses
and
accordingly
the calculation
of the
net rental
income will
be provided
by
no
later than the end of
each month
in
respect
of
each
payment of
net
rental
to
the
plaintiff
s
attorneys
and
to the
independent
attorney;
1.1.4
The defendant
shall in addition be
entitled to deduct from the income
earned
(described
in
1.1.2.1 above)
all
payments
made
in
terms of
any
valid
tax
obligation
that
the
defendant
owes to the
South African Revenue
Service including accrued
or
past
taxes, provisional
tax
and Value
Added
Tax
and
shall
provide
the
independent
attorney
with documentary proof of
all
such
payments made
in
deducting such payments
from the
income
received.
1.1.5
This
order
shall be
effective
immediately
and will
commence applying
to
income
received for
the
month
of
October
2016
and
every month
thereafter pending
finalisation of
the
action
under case
number 55004/2012.
1.1.6
The costs of
the
independent
attorney
will be paid
out of
the proceeds
of the net
income received
by the independent
attorney
in
terms
of
this
order.
1.1.7
The independent attorney
shall on a
monthly
basis provide the parties
through
their
legal representatives,
with
a statement
reflecting
the details of all income
received
and
expenses
deducted,
with
the necessary supporting
documentation,
owners'
statements,
as well
as the
fees
of the independent
attorney,
and the balance
standing
in the
fund.
2.
The costs of the application are reserved for future
determination.
N
KOLLAPEN
JUDGE
OF THE HIGH
COURT
OF SOUTH AFRICA
55004/2012
HEARD
ON:
15
JUNE
2016
FOR
THE PLAINTIFF: ADV. A C
BOTHA
&
ADV.
J
F PRETORIUS
INSTRUCTED
BY: SIM
&
BOTS
I
ATTORNEYS INC.
(ref.:SD/MN)
FOR
THE
DEFENDANT: ADV. S
D
WAGNER SC
INSTRUCTED
BY:
COETZER
&
PARTNERS
(ref.: F
COETZERIFM0157)