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[2015] ZAGPPHC 1154
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Shell South Africa Marketing (Pty) Ltd v H L Hall & Sons (Group Services) (Pty) Ltd and Others (89496/2014) [2015] ZAGPPHC 1154 (22 May 2015)
IN
THE
HIGH
COURT
OF
SOUTH AFRICA
GAUTENG
DIVISION, PRETORIA
CASE
NO.: 89496/2014
DATE:
22/05/2015
In
the matter between:
SHELL
SOUTH
AFRICA
MARKETING (PTY)
LTD
Applicant
and
H
L
HALL
&
SONS (GROUP SERVICES)
(PTY)
LTD
First
Respondent
K2014/49699/07
t/a TIEKIEDRAAI EIENDOMME (PTY)
LTD
Second Respondent
REGISTRAR
OF DESOS, PROVINCE OF MPUMALANGA
Third Respondent
JUDGMENT
BERTELSMANN
J:
[1]
The Applicant is Shell South Africa Marketing (Pty) Ltd
(previously known
as
Shell South Africa (Pty) Ltd), a company with limited liability duly
registered and incorporated
as such according to. the company laws,
of
South
Africa
with
registration number 61/00645/07 and its principal place of
business and registered head office situated at Twickenham
Building,
The Campus, 57 Sloane Street, Bryanston,
Johannesburg.
[12]
The First Respondent is H L Hall
and
Sons (Group
Services) (Pty)
Ltd,
a
company with limited liability duly registered and
incorporated as such according to the company laws
of
South Africa with registration number 1921/006878/07, having its
registered address situated at KPMG Forum, 33
Van
Ransburg Street,
Nelspruft.
[3]
The Second Respondent is K2014/49699/07 t/a Tiekledraai Eiendomme
(Pty)
Ltd In the
agreement (a company to
which
only
a registration number
can
be allocated as to date) which Is a company with limited
liability
duly
registered
and incorporated as such according to the company
Jaws of South Africa, having its
registered address situated at
Halls Gateway, Mataffin, Nelspruit, Mpumalanga.
[4]
The Third Respondent
is the Registrar of
Deeds
for
the province of Mpumalanga,
with
its business address
situated at 25 Bel, Street, Nelspruit.
[5]
The Applicant leased from the First
Respondent during November 1991 a
portion
of Portion 13 of the farm Riverside. The leased property is described
in a written agreement of lease which
the
parties
entered into as
"that portion of the property measuring
±
6550 (six thousand five hundred and fifty) square metres, more
fully described on the plan annexed hereto, marked “A”,
together with the buildings and improvements to be erected thereon in
accordance with the plans and specifications annexed hereto,
marked
"B",
agreed
between Shell and the Lessor (comprising a garage, filling and
service station)''.
[6]
The lease provides
that
the Applicant shall have beneficial
occupation of the premises for an Initial period of 20 years, with an
option to further renew
the lease
for
a further 10
years.
[7]
Clause 21, headed
"
SALE"
provides
for
a right of
pre-emption, granted by
the Lessor, the First
Respondent, to the Applicant as
Lessee:
(p.58) "At any
time during the currency of this
lease or any extension
thereof the Lessor
undertakes that it will not sell, or
otherwise dispose of, the
premises or any portion thereof, to
any third party without first having offered to Shell to
sell or dispose of it,
or the relevant portion thereof, to Shell, on
the identical terms and conditions in all respects upon which the
Lessor was prepared
to sell · or dispose of it, or the
relevant portion thereat, to the third party, and to this end the
Lessor further undertakes
-
21.1
that it will, before selling or ,otherwise
disposing of the premises
or any portion thereof to any third
party, first of offer to sell or dispose of its;, or
the portion thereof
in question, to Shell in
writing on the identical terms and conditfanc1 in
all respects upon which
ii is prepared or is desirous of selling or
disposing thereof to the third party
21.2
in the offer referred to in 21.1, furnish the terms and
conditions in all respects upon
which it is prepared
or is desirous of selling or disposing thereat to the third party,
save that it shall not
be obliged to disclose to Shell the name, and
address
of the third party;
21.3.
the offer referred to in 21 and 21.1 shall remain open for a period
of 30 days, [thirty], from
the date of receipt thereof by Shell;
21.4.
should Shell decline the setoff, or not accept it within the said
period of 30,
[thirty] days, the
Lessor will not thereafter dispose of the premises, or
the portion thereof in
question, to the said third party or at a
price lower or on terms and/or conditions more favourable in anyway
at all, to such third
party, the price, terms and
conditions upon which the offer was made to Shell in terms of
21.1.
21.5.
failure on Shell's part to accept any offer made to it in terms of
the aforegoing shall
entitle the Lessor to dispose of the premises,
or the relevant portion thereof, to the third party in question,
but no one
else, upon terms not more favourable to
such third party than the last offer refused
by Shell,
upon condition that any such sale or disposal shall
not be concluded without first binding the third party to the terms
and
conditions of this lease. Failure on Shell's part to accept any
such offer shall in no way affect the obligations undertaken by
the
Lessor as set forth elsewhere herein.''
[8]
It is this right of pre-emption
that the Applicant seeks
to
enforce in this application, which is opposed
by the First and Second Respondents.
Clause 21 and
21.1 clearly
determine
that Shell is entitled to be aware
of
all clauses
of a
proposed
purchase
agreement the
First
Respondent as
owner
intends
to
enter into with
the intending purchaser before it is obliged
to consider whether to
exercise its right of
pre-emption. Strong support for
this conclusion is
found
in the use of
the words “identical terms and conditions in all respects”
upon which the seller, First
Respondent, is prepared to sell.
[9]
When the First Respondent entered into
negotiations with
the Second
Respondent during October
2014 for the safe of the premises
it sent the
following message to Shell at page 84 and 85
of the papers from Hubert De Haas, with his address, dated 28 October
2014 to H L Hall
and Sons [Ply] Ltd for the attention of Mr Craig
Lewis. In other words, this is the
offer
which was received
from the second respondent by the first respondent of which a copy
was then sent to the applicant:
"Mr Lewis,
BE: OFFER·
TO PURCHASE: PORTION 1 OF ERF
49
,
MATAFFIN TOWNSHIP
The purpose of this
letter is to confirm the recent discussions relating to the purchase
of the above properly,
We hereby confirm:
1.
That the subdivision of Erf 49 has been approved.
2.
That the filing station FS is erected upon portion 1 of Erf 49
and which is presently leased to Shell in terms of a notarial
long term lease.
3.
That your company has indicated that it is prepared to accept offers
for the purchase of portion 1 of Erf 49, Matafan Township.
4.
That Shell has the right of first refusal.
5.
That an offer of R17 million,
[Seventeen million rand] with \/AT going zero
rated, is hereby made to your company for the purchase
of:
5.1.
Portion 1 of Erf 49 whereupon a Shell filling station
is erected;
5.2.
The notarial long term lease agreement concluded with Shell;
5.3.
The site license.
6.
That the offer as set out herein is subject
to:
6.1.
The terms and conditions of the bond granted by Nedbank, a
financial institution, subject to the normal lending
criteria
for commercial loans of a similar nature;
6.2.
The purchase price in point 5 is the full purchase price with
the exception of transfer and conveyancing costs;
6.3.
That the offer is made in capacity as director of
Tiekiedraai
Eiendomme [Pty] Ltd, registration number 2014/49699/07;
6.4.
That an order for
the sale to be zero rated
Tiekiedraai must be VAT registered;
6.
5.
That the offer as contained herein will be referred to Shell to
enable them to exercise their right of first refusal;
6.5.
That in the event of Shell failing to exercise its-first
right
of a refusal to purchase, will a formal sale agreement be concluded
upon acceptance of the offer as set out herein;
6.
7.
That the further terms and conditions
to
be incorporated in the Sale Agreement to be agreed
upon.
Kindly acknowledge
receipt.
Yours faithfully,
HUBERT DE HAAS
(ln my capacity
as
director and duly authorised thereto)".
[11]
This notification
did
not comply with clause 21
and 21.1 and expressly recorded
that
the
full and complete terms
of
the intended contract
had
not
yet
been defined. Consequently, the
fact that the Applicant was Informed of the
existence of the as yet uncompleted
and stiff
to
be finally
negotiated draft agreement between the First
and Second Respondents on
30 September
2014
did not trigger the commencement of the 30 day period within which
the
applicant had to exercise its pre-empted option. That this
was the Applicant's view, is clear from the email messages that
passed
between Mrs Ryder on behalf of the Applicant and
Lewis on behalf of the First Respondent on pages
86 to 92 of
the
papers.
[121
The First Respondent's re/lance on
the
email of 30 October as
having given proper notification to the Applicant to place it
on
terms to exercise its right of
pre-emption within 30 days of that
date is misplaced. First
Respondent's
argument
that it contained all that was necessary to inform
the Applicant of the
intended
transaction is incompatible
with the
express words
of
clause
21
and
21.1.
[13]
The Second Respondents argument that the message of 30 October
constituted substantial compliance with the clauses I have quoted
must founder on the same rock. The first time there 30 October
constituted substantial compliance with the c1auses I have quoted·
must founder on the same rock. The first time there was compliance
with
these
clauses was 5 December
2014
when
the
final contract signed
by
the first and Second Respondents
was sent to Mr Ryder. The Applicant immediately exercised its
right of pre-emption upon receipt
thereof.
[14]
It follows that
the
Applicant must succeed. The order that was proposed, namely, that the
Applicant will step into
the
shoes of the Second Respondent is
not controversial and was not contested
in
argument.
[15]
An order is consequently made
in
terms of the draft order
dated 20 May 2015
which
reads as follows:
"Having read the
papers and heard counsel in the matter an order is made in the
following terms:
1.
It Is declared that the agreement, RS15, to the founding affidavit,
is deemed
to have been concluded between the
First Respondent as
the seller and the
Applicant as purchaser;
2.
The First Respondent is ordered to take all
necessary
steps to ensure transfer of the property into
the name of the Applicant;
3.
In the event of the First
Respondent failinn to take all necessary
steps within 10
days from demand by the Applicant of the First Respondent to
take such steps, then
and in that event the
deputy Sheriff is authorised to sign
all necessary
documents for and on
behalf of the First Respondent to ensure that the property, Portion
1 of Erf 49 Mataffan
Township is transferred into the name of
the Applicant;
4.
Costs of the Applicant to be
paid by the Respondent jointly and severely
the one to pay the other to be absolved, the
cost of the application will include the costs of both
parts
A and B of the application and the appearances associated
therewith."
Signed
at Pretoria on this_ day of
2015.
____________________________
E
B.ERTELSMANN
Judge
of the High
Court