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[2015] ZAGPPHC 8
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Kungwini Estates (Pty) Ltd v Kepoa Property Owners Association (NPC) and Others (30121/2011) [2015] ZAGPPHC 8 (23 January 2015)
IN
THE HIGH COURT OF SOUTH AFRICA
GAUTENG
DIVISION, PRETORIA
CASE NUMBER:
30121/2011
DATE: 23 JANUARY
2015
In the matter
between:
KUNGWINI ESTATES
(PTY)
LTD
.......................................................................................
APPLICANT
and
KEPOA PROPERTY
OWNERS ASSOCIATION (NPC)
....................................
FIRST
RESPONDENT
KUNGWINI
HOMEOWNER’S
ASSOCIATION
............................................
SECOND
RESPONDENT
THE REGISTRAR OF
DEEDS
.............................................................................
THIRD
RESPONDENT
MUNCIPAL MANAGER:
TSHWANE
METROPOLITAN
MUNICIPALITY
...............................................................
FOURTH
RESPONDENT
KUNGWINI ERF 10
HOMEOWNERS ASSOCIATION
....................................
FIFTH
RESPONDENT
DAMSIG ERF 7
HOMEOWNER’S
ASSOCOATION
.........................................
SIXTH
RESPONDENT
KUNGWINI RANCH
HOMEOWENER’S ASSOCIATION
........................
SEVENTH
RESPONDENT
KUNGWINI BAY
HOMEOWNER’S
ASSOCIATION
....................................
EIGHTH
RESPONDENT
KUNGWINI PARK
HOMEOWNER’S
ASSOCIATION
....................................
NINTH
RESPONDENT
JUDGMENT
TLHAPI J
[1] This is an
application in which the following order is sought:
“
1.
That the Court Order granted on the 24 June 2011 under case number
30121/2011 be amended by replacing the reference to
“
Erf
21”
and
the detail thereof with a reference
“
the
remaining extent of Erf 21 measuring 2.2798 ha in extent’’
2. That the third
respondent be ordered to effect transfer of the remaining extent of
Erf 21 to the first respondent at the applicant’s
exclusive
cost.
3. That the
applicant be ordered to pay the costs of this application in so far
as it is not opposed."
This application was
opposed by the second respondent which also launched a counter
application in which the following order is
sought:
“
1.
That the Court Order dated 24 June 2011 issued under the above case
number be amended to read as follows:
‘
The
First Respondent, Kungwini Estates (Pty) Ltd, is ordered to transfer
Portion 1 of Erf 21 and the Remainder of Erf 21 (which
properties
previously comprised Erf 21) in the township Kungwini Country Estate
to KEPOA Property Owners Association (NPC) and
pay all costs and
taxes reasonably associated with the transfer of the aforementioned
immovable properties. ”
2.
The
Applicant is ordered to pay costs of this application,”
This application was
opposed by Kungwini Estates (Pty) Ltd.
[2] The applicant
was the developer of several residential estates situated on the
banks of the Bronhortspruit Dam, known as the
Kungwini Country
Estates, (“the estate”). It is also the registered owner
of Erf 21 which is central to this application
and which erf
constituted the communal entrance shared by the residential estates
(2
nd
, 5
th
, 6
th
7
th
8
th
and 9
th
respondents).
[3] The
establishment of the testate during 1998 was approved by the fourth
respondent (successor in title to the KUNGWININ Local
Municipality)
subject to the following conditions published in Government Notice
6031 and 6032 dated 22 September 1999 :
Condition 2.6
“
Die
eienaarvan
Erf 21 moet voile verantwoordelikheid virthe funksionering en
behoorlike instandhousing van Erf 21, en die noodsaaklike
dienste wat
daarin vervat is, neem. Die plaaslike bestuursal nie
verantwoordelikhied aanvaar vir die wanfunksionering van die
oppervlakte van die toegangspad erf/of die
stormwaterdreineringstelsel [sic] en /of enige noodsaakilike dienste
nie”
Condition 2.7
“
Die
erf moet deur
'n
regspersoon
wat deur die dorpseienaar genomineer staan te word besit word”
[4] In pursuance of
the above conditions the second respondent, after thirteen years
launched an application under case number 30121/2011
to compel the
applicant to effect transfer of Erf 21 to a section 21 company to be
established. This application was not opposed
by the applicant, who
was the first respondent at the time, nor was it opposed by the third
to ninth respondent herein. On 24 June
2011 Fabricius J granted an
order compelling such transfer.
[5] Mr Johann
Walters (“Walters”) who deposed to the founding affidavit
averred that in complying with the court order
it was informed by its
attorneys that while gathering the approved Surveyor General’s
diagrams , and having initially drawn
up transfer documents in
respect of Erf 21, it was informed and also realized that the
communal entrance road was no longer known
as Erf 21 but as the
remainder of Erf 21. In order to give effect to the court order it
instructed its attorney to proceed with
the drawing up of transfer
documents in respect of the latter. A release of the remainder of Erf
21 from a bond registered in favour
of Standard Bank was secured and
it obtained from the fourth respondent and settled a tax clearance
certificate applicable to the
remainder of Erf 21. They were later
informed that the third respondent had declined to effect
registration and issued the following
note:
“
In
terms of order of court (doc 4 in No. 7 of the batch) the whole
should be transferred (e.g 2, 5566 Ha). Withdraw this Deed and
Application or have the said order amended”
[6] Walters
contended that although the applicant was not opposed to transferring
the communal entrance road and the servitude registered
thereon to
the first respondent, there was a mistake committed by both the
applicant in the main application (the second respondent
herein) and
the applicant in not referring to the specific property as the
“Remaining Extent of Erf 21,” because that
‘was the
common intention of the parties’. The second respondent had
relied on the original Conditions of Establishment
of 1999
‘applicable to the original township established in terms of
section 103 of the Town Planning and Township Ordinance
of 1986 (“the
Ordinance”). Subsequent to the original conditions the
applicant had during 2006 to 2008 caused to be
effected to Erf 21
certain changes to the land use. Therefore as at date of the order
transfer of Erf 21 to the first respondent
as it was previously known
was ‘virtually impossible’..
[7] In order to give
effect to its intention to develop a shopping centre on a
consolidated piece of land and at the entrance of
the estate the
applicant launched applications with the Kungwini Local Authority for
subdivision, consolidation, road closure and
servitude
deregistration.
[8] It applied to
the Kungwini Local Authority in terms of section 92 of the Ordinance
in 2005, for approval for the subdivision
of Erf 21 into two
portions, being Portion 1 of Erf 21 (extent: 2708 sq metres) and the
Remainder of Erf 21 (22798 sq metres) and
for road closure and
servitude deregistration applicable to Erf 21. In 2006 it applied for
the consolidation of Portion 1 of Erf
21 with Portion 66 of Erf 4 of
which applicant was the registered owner. Both applications were
approved and the latter became
known as Erf 85.
[9] It was contended
that Portion 1 of Erf 21 fell outside the main entrance and the
access road to the estates. Furthermore that
in approving the
applications, the Local Authority, was satisfied that the land use
changes applied for did not adversely affect
the original conditions
of establishment. As it was entitled to do in terms of section 92 (3)
of the Ordinance, it amended the
original conditions of establishment
to accommodate the changes and as contained in a letter from the
Local Authority dated 9 May
2006, annexure “W11” and the
conditions stated therein were the following:
“
The
approval granted shall be subject to the following condition:
1. The applicant
has to arrange for the provision of civil services with the Director
Service Delivery;
2. That the
applicant has to supply two copies of the diagram within three months
after approval by the Surveyor General to the
Local Municipality as
stipulated in regulation 37 of the Ordinance of Town Planning and
Townships, 1986 (15 of 1986);
3. That a
certified copy of the new title deed be submitted to Kungwini Local
Municipality;
4
..........
5............”
On 5 April 2007 the
Surveyor General approved the land use changes by issuing the
relevant diagrams annexure “W13” to
the application as
indicated in the map by the Surveyor General and annexed as “A5”
to the main application.. The changes
were not registered against the
title because the applicant contended that it was practice that
registration would occur ‘when
ownership of a subdivided or
consolidated portion is transferred to different persons or entities.
The applicant proceeded to install
bulk electricity and instructed
architects to draw up ‘concept plans and architectural drawings
for the proposed shopping
centre.
On 9 May 2009 an
application again to the Local Authority for there zoning of the
consolidated portion of land to include business
rights was approved.
[10] Ms Daleen Van
Dyk (“ Van Dyk”) deposed to the answering affidavit. The
applicant established the first respondent
in order for it to take
transfer of Erf 21 on behalf of every single owner of property in the
Estate. The purpose of the counter
application was prompted by the
revelations in the founding affidavit in which the alleged changes to
the land use in respect of
Erf 21 came to the knowledge of the second
respond for the first time. While admitting that the original Erf 21
had been subdivided,
she contended that the variation of the existing
Court Order as prayed for in the counter application would result in
compliance
with the original Condition of Township Establishment.
She denied that
there was an error on the part of the second respondent. The
applicant had failed to give notice to the second respondent
of its
intention to apply to the Local Authority for land use changes,
amending the original Conditions of Township Establishment.
She
contended that transfer of the entire property previously known as
Erf 21 was demanded because the original Conditions of Township
Establishment which conditions were still ‘applicable and have
not been recalled or amended’. It was contended that
the
applicant was misleading the court in not disclosing that Portion 1
of Erf 21 not only included the piece of land next to the
communal
gate, but also the portion of land from which boats were launched
into the Bronkhorstspruit Dam. This became evident when
it attempted
to effect registration of only the Remainder of Erf 21. This attempt
was thwarted by the third respondent when it
realized that such
intended registration was not in accordance with the wording of the
Court Order compelling transfer of Erf 21.
[11] No changes had
been effected on records obtained from searches with the third
respondent and the applicant had failed to provide
proof that it had
applied for land use changes with the Local Authority in terms of
Section 99 of the Ordinance. In response to
a request in terms of
Rule 35 (12) for disclosure of documents relating to such changes the
applicant informed them that after
dililigent search and enquiries
such records could not be obtained and that it relied on annexure
“W11”.
[12] In reply the
applicant contended that the second respondent could not rely on the
contents of the founding affidavit in the
main application without
referring in its answering affidavit to those averments specifically
relied upon. Furthermore that it
did not seek to review or set aside
the decisions of the relevant local authority by virtue of which Erf
21 was subdivided, consolidated
and again subdivided and the right of
way servitude cancelled and the approval of the street closure and
rezoning of the property
for commercial purposes.
It did not oppose
the main application because it wished to transfer the ownership of
the communal access road to an entity representative
of the owners of
the estate. The error by the applicant and second respondent
consisted in that both did not realize that when
the main application
was launched the communal access road was no longer situated on Erf
21 as it originally existed but that it
was located on the Remainder
of Erf 21. The area marked in green in the diagrams relied upon in
the main application relate to
communal access road located not on
the full extent of Erf 21 but on the Remainder of Erf 21. Furthermore
Portion 1 of Erf 21,
which initially formed part of Erf 21 did not
exist since the subdivision and consolidation applications of 2005
and 2006.
[13] In as far as
notice was not been given to the second respondent the applicant
averred that at the time of consolidation it
was the majority
shareholder in the second respondent and that the Local Authority in
granting the approval had satisfied itself
that the applicant had
complied with the ‘necessary statutory prescriptions, including
those relating to public participation’
required in terms of
the Ordinance. Approval as reflected in the diagrams of the Surveyor
General and marked “W13”
was proof that proper
applications for land change use preceded such approval.
[14] In her reply to
the counter application Ms Van Dyk contended that the second
respondent had always maintained, as now admitted
by the applicant
that only one township, the Kungwinin Country Estate was created and
that separate townships were never created.
The applicant having
failed to produce any evidence that the amendment of the conditions
took place, the matter fell to be adjudicated
in terms of the
original Conditions of Establishment published in 1999.
Furthermore, from a
diagram obtained from the attorneys of the applicant and annexed as
“R4” it was evident that Portion
1 of Erf 21 consisted of
three further pieces of land one of which included land from which
boats were launched from the Dam and
that in as far as this was not
disclosed the applicant had attempted to mislead the court.
[15] It was my view
after hearing argument in the matter that the third respondent even
though not opposing the application could
have assisted the court by
filing a report on what transpired when it declined to register the
remaining extent of Erf 21, as presented
by the applicant. I
therefore called for such report and the following was mentioned:
“
3.
I respectfully wish to draw the attention of the Honourable Court to
the following:
3.1
I received copies of documents drafted for an application for a
Certificate of Registered title in terms
section 43
of the
Deeds
Registries Act, no.47 of 1937
, in respect of Portion 1 of Erf 21
Kungwini Country Estate,
.......
3.2
From
Annexure “W18” I draw the conclusion that a batch of
deeds was lodged, where an application was made by the owner
of Erf
21 for a subdivision of the erf by way of Certificate of title, with
a simultenous transfer of the Remaining extent of the
erf to the
first respondent. I did not receive the whole batch, with all
documents, especially the note sheet upon which this office
would
have raised the offending note.
3.3
The conditions of establishment of the township Kungwini Country
Estate
was
published
in the Provincial Gazetter no. 79 dated September 1999. It is the
duty of the Registrar to ensure compliance with the
conditions of
establishment. Condition numbered 1.7 of the said conditions of
establishment prescribes that the whole of erf 21
has to be
transferred to the second respondent and not the remainder thereof.
The problem can be resolved if the Municipality of
Kungwini publish
and amended conditions of establishment that provided for the
subdivision of erf 21, and the transfer of the remainder
of erf 21 to
the Home Owners Association”
[16] The crisp issue
to be determined was whether the court order of the 24 June 2011 can
be amended as sought by the applicant
by the substitution of “Erf
21” with “the remaining extent of Erf 21...”, on
the basis of an alleged mistake
on the part of the applicant and
second respondent, or, alternatively as sought by the second
respondent in the counter application,
an order compelling the
applicant to transfer “ Portion 1 of Erf 21” and ‘the
remaining extent of Erf 21”
to the first respondent..
There is therefore
an understanding by both parties that transfer of Erf 21 as existed
during 1999 and as provided for in the original
Conditions of
Establishment (as ordered by Fabricius J on 24 June 2011) cannot be
effected.
[17] The several
applications of changes to land use, that of subdivision,
consolidation, deregistration of the servitude and closure
of road,
which were approved by the Local Authority changed the description of
the land as it was originally known during 1999.
That this process
was engaged cannot be disputed by the second respondent because such
fact is evident from the diagrams emanating
from the office of the
Surveyor General which diagrams were annexed to the papers.
[18] The third
respondent’s report did not assist me because it was not a
report on the process engaged by the third respondent’s
official when the offending note was issued. The third respondent
acknowledges the fact that he was not given the necessary batch
of
documents that resulted in the offending note being issued. My
understanding of the process of registration or transfer of immovable
property is that an examiner in the third respondent’s office
would also have access to the records of the Surveyor General
for
examination and verification.
[19]
The purpose of the exercise is to satisfy himself that the property
sought to be transferred, in particular the description
thereof
accords with the records of the Surveyor General. In my view the note
was raised because the description in the batch presented
for
registration to the third respondent and the Surveyor General
differed with the court order. The third respondent could therefore
not give effect to the order and the original conditions of
establishment that the whole of Erf 21 be transferred. Hence the
suggestions
in the note
‘
that
the application for transfer of only the remaining extent of Erf 21
be withdrawn or that the court order be amended’
and
in the report that the Local Authority be approached to
‘
publish
an amended conditions of establishment ‘for the subdivision of
Erf 21 and the transfer of the remaining extent of
Erf 21.’
[20] It was argued
for the applicant that when the applications for changes to land use
were considered and approved by the Local
Authority that such process
entailed administrative action and that the said authority had
satisfied itself that the formalities
prescribed had been complied
with. The approvals had the effect of changing the character of Erf
21 and, also of amending the original
conditions of establishment.
The second respondent had not approached the court to have such
action reviewed or set side.
It was argued for
the second respondent that the applications were done in a secretive
manner without giving notification or co-operation
of any of the
Homeowner’s Associations. Furthermore that the changes to land
use would deprive all the residents of the estate
‘from having
unfettered and unrestricted use and right to launch their boats into
the dam because the newly created Portion
1 Erf 21 included the piece
of land next to the communal gate, and, that portion of land from
which boats were launched into the
dam, which is also where the
applicant wishes to establish a shopping complex. Erf 21 was
comprised of Portion 1 of Erf 21 and
the Remainder of Erf 21 and
amendment of the court order of the 24 June 2011 would give effect to
the original Conditions of Establishment.
[21] It is important
to note that although the applicant failed to comply with the demand
for disclosure of documents in terms of
Rule 35
(12), annexure “W11”
was of significance because it indicated that approval was given by
the Local Authority and that
changes were effected to the description
of Erf 21 and also to the description of Portion 1 of Erf 21 where it
was consolidated
with Portion 66 of Erf 4 to form Erf 85. It is
unfortunate that the Surveyor General’s office was not called
upon to give
input on the correct explanation of the diagrams
emanating from that office and annexed to the papers. It does however
appear from
the diagrams dated 5 April 2007 that the Surveyor General
had approved the subdivision of Erf 21 into Portion 1 of Erf 21
together
with the cancellation of the servitude and, the Remainder of
Erf 21 with retention of the servitude.
[22] In the founding
papers applicant averred that annexure “W13” on pages 126
to 131 of the papers was proof of the
incorporation of all the
changes (ABCDEFGHIJ KLM) and this is clearly seen on the diagram on
page 131 of the papers. According
to the diagram approved by the
Surveyor General what now exists is the Remainder of Erf 21 Servitude
and Erf 85 ( Portion 1 of
Erf 21 consolidated with Portion 66 of Erf
4)
[23] Although the
second respondent was not made aware or notified of any intention by
the applicant to amend the original Conditions
of Establishment, the
above mentioned processes are confirmation that the applications for
changes to the use of land were approved
by the Local Authority and
the Surveyor General even though such changes were not as yet
registered against the title to the land.
In my view this explains
why the third respondent did not have proof of such changes and also
why the second respondent would not
have been made aware when it
conducted deeds searches with the third respondent because the
applicant had not fully complied with
the condition that a copy of
the new title deed be filed with the Local Authority ( condition 3
“W11”). In my view
the approvals in principle had the
effect of amending the original Conditions of Establishment.
[24] The approvals
remain in place and cannot be disregarded even where the conduct of
the applicant or the local authority was
viewed by the second
respondent to have been contrary to the original Conditions of
Establishment, Oudekraal Estates (Pty) Ltd
v City of Cape Town
& Others
2004 (6) SA 222
(SCA) 242 A-C:
“
Until
the Administrator’s approval (and thus also the consequences of
the approval) is set aside by a court in proceedings
for judicial
review it exists in fact and it has legal consequences that cannot
simply be overlooked. The proper functioning of
a modern state would
be considerably compromised is all administrative acts could be given
effect to or ignored depending upon
the view the subject takes of the
validity of the act in question. No doubt it is for this reason that
our law has always recognized
that even an unlawful administrative
act is capable of producing legally valid consequences for so long as
the unlawful act is
not set aside. ”
[25]
At
establishment of the estate the communal access road had been
registered against the whole of Erf 21. This is evident from the
subsequent applications by the applicant for road closure and
cancellation of servitude on the land later to be known as Portion
1
of Erf 21.
Erf 21 was the land
which according to the 1999 Conditions of Establishment had to be
transferred to a separate entity for the benefit
of the residents of
the estate. The main application was launched to compel such transfer
of Erf 21. As I see it, the purpose of
attaching “A5” to
the main application (“W13” in this application) was
meant to give the court an understanding
of the ‘layout of
Kungwini Country Estate” as averred, and it was not annexed
under the mistaken belief that what was
described therein as the
Remainder of Erf 21 Servitude, was what was sought to be transferred.
The changes to the use of land over
the years and the envisaged
future developments were in my view drastic, to such a degree that
the applicant cannot now claim that
there was a mistake or that it
was ignorant of the changes to the original conditions of
establishment when it was served with
the main application and when
it decided not to oppose such application. This is evident from the
fact that the applicant decided
to proceed with an attempt to
register the Remainder of Erf 21 Servitude, without first informing
the second respondent that it
had encountered a problem when
implementing the court order, that is, even before the offending note
was issued by the third respondent.
[26]
I am therefore not persuaded that on the facts of this case the
applicant has made out a case that it together with the second
respondent were
ad
idem
regarding
the alleged mistake or; that there were grounds upon which the order
of the 24 June 2011 might be rescinded or varied.
The second
respondent has never sought that only the Remainder of Erf 21
Servitude be transferred to it. Also in the light of the
Oudekraal
decision
the second respondent is not entitled to a variation of the order of
the 24 June 2011 until such time that the approvals
are set aside
because Portion 1 of Erf 21 and the Remainder of Erf 21 Servitude are
not an equivalent to the proper description
of the land sought to be
transferred in terms of the original Conditions of Establishment. As
I see it both applications must therefore
fail.
[27] In the result
the following order is given:
1. The application
is dismissed and each party is to pay its own costs;
2. The counter
application is dismissed and each party is to pay its own costs.
TLHAPI V.V
(JUDGE OF THE
HIGH COURT)
MATTER HEARD ON :25
MARCH 2014
JUDGMENT RESERVED ON
:25 MARCH 2014
ATTORNEYS FOR THE
APPLICANTS : E.W SERFONTEIN & ASS.
ATTORNEYS FOR THE
RESPONDENTS: STUART VAN DER MERWE I INC