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[2013] ZAKZPHC 53
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Haviside v Heydricks and Another (AR27/13) [2013] ZAKZPHC 53; 2014 (1) SA 235 (KZP) (17 October 2013)
19
IN THE KWAZULU-NATAL HIGH COURT,
PIETERMARITZBURG
REPUBLIC OF SOUTH AFRICA
CASE NO. AR27/13
In the matter between:
BARBARA JOY HAVISIDE
...............................................................................
Appellant
and
MORNE HEYDRICKS
...........................................................................
First
Respondent
JANE HEYDRICKS
..........................................................................
Second
Respondent
_______________________________________________________________
APPEAL JUDGMENT
delivered
on 17 October 2013
_______________________________________________________________
STRETCH AJ:
[1] On 15 August 2005 the
parties concluded a written sale agreement in terms of which the
respondents bought immovable residential
premises (the property) at
Port Shepstone from the appellant for R896 400,00.
[2] Subsequent to having
taken transfer, the first respondent approached the local
municipality because he and the second respondent
wanted to build a
flat on top of the existing double garage and outbuildings.
[3] Upon inspection of
the municipality’s files the first respondent discovered that:
[3.1] A letter dated 26
June 1991 had been drafted by the municipality ostensibly for the
appellant’s attention, stating that
it had come to the
attention of the municipality that an illegal structure (which was
presumably a carport) was in the process
of being built on the
property in the absence of plans having been submitted to the local
engineer’s department for approval.
[3.2] The file did not
contain any plans for the existing double garage which formed part of
the property which the respondents
had bought.
[3.3] Subsequent to
consultations with an architect and a civil engineer, it was
confirmed that not only were there no building
plans for the double
garage, but also that the structure which had been erected did not
meet the usual standards in terms of building
regulations. The
architect quoted R2 250,00 to draft proper plans to remedy the
situation.
[4] In his evidence in
the magistrates’ court, the first responded admitted that:
[4.1] he did not obtain a
copy of the title deeds before buying the property;
[4.2] he did not approach
the municipality to inspect the building plans before buying the
property;
[4.2] he and the second
respondent had assumed that everything was in order.
[5] The architect who had
furnished the respondents with the aforesaid
quotation admitted that
even if valid foundations were in place with respect to the double
garage, it could not be assumed that
such foundations would be strong
enough to sustain a second storey above the double garage.
[6] A civil engineer
confirmed, in respect of the double garage, that:
[6.1] the foundations
were inadequate;
[6.2] the external walls
consisted of a single instead of a double layer of bricks and these
walls were not binded in;
[6.3] the roof pitch was
not sufficiently slanted;
[6.4] there was no lining
underneath the roof.
[7] In a nutshell the
double garage was an illegal structure which did not conform to
municipal bylaws.
[8] It was not disputed
that it would cost the respondents in the region of R91 512,00 to
obtain plans and to demolish and reconstruct
the double garage in
accordance with the bylaws and building practices; alternatively that
this amount (being the quantum of the
respondents claim against the
appellant in the action instituted in the magistrates’ court)
represented the diminished value
of the property.
[9] The appellant
testified that:
[9.1] When she bought the
property (as a first time home owner) from an
employee of the
municipality during 1991, there was already a carport in existence.
[9.2] At all material
times thereafter the property was occupied by her mother and she only
visited there once a year.
[9.3] After she had
purchased the property, her mother and her brother filled in the
walls of the existing carport without her knowledge
or consent. When
she visited at Christmas time, it was already a
fait accompli.
She
did not deem it necessary to ask her family whether they had obtained
permission to do this or whether they had submitted plans,
because
she was not interested in the maintenance of this house which she had
bought for her mother to occupy, and that she accordingly
left these
issues to her brother. When she saw that the walls had been erected,
it did not occur to her that she should ascertain
whether this had
been done in accordance with accepted building standards.
[9.4] It was her mother’s
decision to sell the house and her mother approached agents to do so
with her consent.
[9.5] She did not discuss
the selling price with the agents. All she wanted was to sell for a
“market-related” price.
[9.6] She did not speak
to the respondents before they took transfer of the property.
[10] The trial magistrate
held that the issues for determination were the following:
[10.1] Whether, at the
time that the sale was concluded, there was an
obligation on the
appellant to disclose to the respondents that the double garage was
an “illegal structure”.
[10.2] Whether the
appellant fraudulently, and with the intent to induce the respondents
to buy the property for “R830 000,00”
had failed to
disclose to the respondents that the double garage was an “illegal
structure”.
[10.3] Whether it was an
implied; alternatively, a tacit term of the sale agreement that
improvements on the property had been erected
lawfully, and/or that
building plans had been approved in writing as contemplated in terms
of the National Building Regulations
and Standards Act 103 of 1997
(the Act) prior to the erection of structures, and/or that building
plans had been approved by the
local council, and/ or that the
respondents were entitled in law to use improvements which they had
paid for to their “full
extent.”
[11] The magistrate found
that:
[11.1] There was a duty
on the appellant to enquire whether plans had been obtained for the
double garage and to inform the respondents
that it was an illegal
structure.
[11.2] It could be
inferred that she did not make such disclosure because she wanted a
higher price for the property.
[11.3] The appellant’s
silence in this regard fell within the ambit of non-disclosure which
is similar in many respects to
misrepresentation inducing the
respondents to buy the property.
[11.4] It was an implied
term in the contract that this structure had been erected in
compliance with the Act and/or with the municipality’s
approval. In this regard the magistrate relied for authority on the
judgment in
Van Nieuwkerk
v
McCrae
2007
(5) SA 21
WLD
and also to support his finding that the
appellant was barred from relying on the usual
voetstoots
clause
contained in the sale agreement.
[11.5] The respondents
were accordingly entitled to judgment on the merits which the
magistrate granted.
[12] The appellant
appeals against this judgment on the grounds that the magistrate
erred in:
[12.1] concluding that it
was not necessary to make a finding on whether the appellant’s
non-disclosure was fraudulent, and
that a mere finding of
non-disclosure was sufficient for the appellant to attract liability;
[12.2] not concluding
that a finding of fraudulent misrepresentation required knowledge of
unlawfulness (which the appellant did
not have);
[12.3] not following the
judgment in
Odendaal v Ferraris
2009 (4) SA 313
SCA,
which judgment was given on 1 September 2008, a month before the
magistrate delivered his judgment in the court
a quo;
[12.4] finding in the
respondents’ favour in the face of their failure to have proved
that the appellant had deliberately
concealed the existence of latent
defects with the intention to defraud.
[13] On the other hand,
it is contended on behalf of the respondents that the issue which I
have to determine rests on a crisp legal
point (that the trial court
correctly determined that it was an implied term of the agreement
that structures had been erected
in compliance with building
regulations and with the approval of the municipality), and not on
the factual question of whether
or not the appellant had knowledge of
the illegality of the structure at the time that the sale was
concluded.
[14] In support of this
contention, the respondents rely on the judgment of Corbett AJA in
Alfred McAlpine & Sons (Pty) Ltd v Transvaal Provincial
Administration
1974 (3) SA 506A
at 531D-H
where it is
also stated that a term is not normally implied if it is in conflict
with the express provisions of the contract, and
that an implied term
simply represents a legal duty, imposed by law, unless excluded by
the parties.
[15] It is further
contended on the respondents’ behalf that the appeal against
the magistrate’s failure to uphold the
voetstoots
clause
in the contract is misplaced and founded on a mistaken interpretation
that the “illegality” in the construction
of the garage
amounts to a latent defect excluded by the
voetstoots
clause,
when in reality the illegality applies “to the lack of certain
qualities or characteristics which the parties have
agreed the
merx
s
hould have”, and as such are not excluded by the
voetstoots
clause (see
Ornelas v Andrew’s Café
and Another
1980 (1) SA 378
W at 388G-390C; Van Nieuwkerk v McCrae
(supra) at 21B
).
[16] The respondents
further contend that insofar as reliance is placed by the appellant
on the judgment in
Odendaal (supra)
,
the facts
of that case are distinguishable from the those before me in that in
the matter before me the
merx
was not fit for the purpose for
which it was intended and that it could not be used on account of the
fact that it was an “unsafe”
structure and had to be
demolished.
[17] I am not inclined to
agree with this contention. The evidence which was
presented at the trial
was not that the garage was not fit for the purpose for which it was
intended (which would in my view, and
in the absence of evidence to
the contrary be to park a vehicle or vehicles). On the contrary, it
appears that the structure had
been holding up for some 14 years
before the respondents decided that they wanted to build another
structure on top of it. Indeed,
the evidence of the architect was
that a foundation which would be suitable for a single storey
structure may not be suitable for
a double storey structure, implying
that foundational changes would have to be effected in any event.
[18] However, that is not
the end of the matter. In my view, a proper interpretation of what
was intended to be conveyed in
Odendaal
and a
common-sense application of the
Odendaal
judgment to
the facts before me on appeal, must of necessity require an analysis
of the facts of that case and the other cases
referred to both in
that judgment and in argument before me.
[19] In
Odendaal
there was found to have been non- compliance with the Act in
that previously rejected buildings plans had not been approved in
terms
of the Port Elizabeth Municipality Zoning Scheme Regulations,
and that the garage had not complied with the regulations in that
it
did not have a firewall or a fire door. These were referred to as
latent defects inviting a counter argument that the seller
was
protected in this regard by the
voetstoots
clause in the
contract. On the other hand, it was argued by the buyer that the
seller had concealed these defects from him and
that he was thus
entitled to rely on the
aedilitian r
emedies available to him.
The seller admitted most of the defects but denied wilfully
concealing them.
[20] In
Odendaal
,
as in the matter before me, it was not clear whether the High Court
(having been the court
a quo
in that case) had found that the
seller had wilfully concealed the defects. The Court’s
reasoning also did not traverse the
effect of the
voetstoots
clause, which had excluded liability for both latent and patent
defects as in the case before me.
[21] On appeal the buyer
relied on a new point of law – that the
voetstoots
clause
did not protect the seller from her failure to obtain statutory
approval for the construction of the carport and the outbuilding
(as
is likewise contended in the matter before me).
[22] In support of this
submission the buyer relied (as do the respondents before me) on the
decision in the
Van Nieuwkerk
matter where Goldblatt J
held that a seller in those circumstances could not rely on the
voetstoots c
lause since it excluded liability only for latent
defects of a physical nature and did not apply ‘to the lack of
certain qualities
or characteristics which the parties agreed the
merx
should have’ - which included, he held, statutory
compliance. For this conclusion he found support in the
Ornelas
matter, where a property was sold as a going concern for the purpose
of conducting a café and a restaurant business. After
the sale
the buyers became aware that the restaurant was being conducted
without a licence, and they were unable to obtain one
to operate it.
They cancelled the sale, contending that the seller’s failure
to deliver a property from where the envisaged
business could
lawfully be conducted was a material breach of an implied term.
[23] The sellers sought
refuge in the
voetstoots
clause, but Nestadt J rejected this
argument holding that the clause did not exempt the sellers from
their obligation to deliver
a business which could be conducted
lawfully, and thus this was not a case of a defect in the
res
vendita
but in truth, a case of delivery to the buyers ‘of
something different from what was bought’ (at 389D).
[24] It is clear that the
Ornelas
matter is quite distinct from
Van
Nieuwkerk
as well as from
Odendaa
l and the case
before me. The absence of a licence to operate premises as a
restaurant simply meant that the buyers could not use
it for the
express purpose for which it had been purchased. By contrast, the
absence of statutory approval for building alterations,
or other
authorisations which render a property compliant with prescribed
building standards, such as were in issue in
Van Nieuwkerk
and in
Odendaal,
and in my view are in issue here, do
not necessarily render the property unfit for habitation
[25] It is true that the
structure in the matter before me was not authorised. But, as will
appear from the discussion below, and
as was similarly discussed in
Odendaal
, the absence of statutory permission necessary
to render them authorised are defects to which the
voetstoots
clause in any event applies. This case in my view is therefore
distinguishable from
Ornelas
, which in any event does
not support the reasoning or conclusion reached in both
Van
Nieuwkerk
and in
Odendaal.
[26] As to the nature of
a defect which would fall within the ambit of a
voetstoots
clause,
it has for example been held that in relation to the sale of land as
it stands, the language is wide enough to cover not
only any hidden
defects in the property itself, but also any defect in the title to,
or area of the property (see
Uhlmann v Grindley-Ferris
1947 (2)
SA 459
(C) at 462).
[27] I agree with the
learned Judge in
Odendaal,
that by this token the
defect in
Ornelas
(that the building on the property
could not be licenced for business purposes) might indeed be argued
to fall into this category
(
at 321D
).
[28] Similarly, in
Glaston House (Pty) Ltd
1977 (2) SA 846
(A)
a broad
view
was also taken of what
constituted a latent defect. There the court held that the existence
of a valuable sculpture which had been
embedded in a dilapidated
building and precluded the re-development for which the property had
been bought, was a latent defect
(
at 866F
).
[29]
The position with respect to latent defects was summed up by Corbett
JA in
Holmdene Brickworks (Pty) Ltd v
Roberts Construction Co. Ltd 1977 (3) 670
(A)
at 683H-684A
, where the following was
stated:
‘
Broadly
speaking in this context a defect may be described as an abnormal
quality or attribute which destroys or substantially impairs
the
utility of effectiveness of the
res
vendita,
for the purpose for which it has been sold or for which it is
commonly used … Such a defect is latent when it is one which
is not visible or discoverable upon an inspection of the
res
vendita
.’
[30] The first part of
this
dictum
was re-affirmed in
Ciba-Geigy (Pty) Ltd v
Lushof Farms (Pty) Ltd en ‘n Ander
2002 (2) SA 447
(SCA).
[31] In my view,
therefore, the absence of statutory approval such as is at issue
here, and was also at issue in both
Van Nieuwkerk
and
in
Odendaal,
constitutes a latent defect.
[32] In
Odendaal
,
Cachalia JA held that the carport’s irregular structure
which
may require either its demolition or alteration as a condition for
approval
(my emphasis), are defects which interfere with the
ordinary use of the property – thus satisfying the Holmdene
Brickworks
test – and are therefore latent defects within the
aedilitian
concept. The Judge held further that the fact that
they also contravened building regulations did not change their
character and
disagreed with the finding in
Van Nieuwkerk
to the extent that that case suggested otherwise. The Judge
accordingly concluded that a
voetstoots
clause ordinarily
covers the absence of statutory authorisations
(at 322C-E)
.
I respectfully agree.
[33] After all, the
purpose of such a clause is to exempt the seller from liability for
defects of which he or she is unaware. And
where the seller’s
statutory non-compliance concerns latent defects in the property, as
was the case in
Odendaal
and also in the matter before
me, the seller ought to be entitled to invoke the exemption.
[34]
For the sake of completeness, the
voetstoots
clause in the contract before me reads as follows:
“
7.1
The property is sold:
7.1.1
voetstoots
and as it stands, with all defects whether latent
or patent,
7.1.2
subject to all the conditions, burdens and servitudes referred to in,
and/or registered against the Title Deeds of the property
and to all
such conditions, burdens and servitudes which may exist in regard
thereto.
7.2
The PURCHASER is deemed to be fully acquainted with the property
nature, its conditions, beacons, extent and locality, the SELLER
and
the SELLER’S agents being entirely free from liability in
respect thereof.”
[35]
The matter still does not end here. It is trite that if a purchaser
wants to avoid the consequences of a
voetstoots
sale
,
the
onus
is on him to show
two things:
[35.1] that the seller
knew of the latent defect and did not disclose it;
[35.2]
that the seller deliberately concealed it with the
intention to defraud.
[36]
The
locus classicus
in
this regard is
Van der Merwe v Meades
1991
(2) SA 1
(A) at 8E-F.
[37] There is nothing
before me to suggest that the appellant was aware that the garage had
contravened building regulations. On
the contrary, the relevant
portion of her evidence reads thus:
‘
Question:
Did you have any knowledge or any concept that there was an illegal
structure on the property?
Answer:
No.
Question:
And did you have any idea that there was an illegal structure on the
property when you bought the property?
Answer:
No.
Question:
When you visited the house and you saw that the walls – there
had been walls put in between the pillars of this,
now we’ve
found out, illegal structure, did it occur to you that you should in
fact find out whether it was according to
building standards?
Answer:
No.’
[38] Objectively
speaking, with respect to the last two answers, and insofar as the
suggestion has been that there was already an
illegal structure on
the property when the appellant bought it in good faith from her
successor in title 14 years previously, I
see no reason why she,
herself having bought the property from an employee of the
municipality without any problems, should or
would have had any cause
to contemplate that the original carport may have been an illegal
structure.
[39] In the premises
there is nothing before me to suggest that the seller was aware that
building regulations had not been complied
with. Even if she was
aware, there is nothing to suggest that she ought to have considered
the matter significant enough to mention
to the buyer. In any event,
the respondents’ case in the trial court failed to establish
the test set forth in
Van der Merwe v Meades
(that the
appellant deliberately concealed the fact that building regulations
had not been complied with, from the respondents
in order to induce
the sale of the property at an inflated price).
[40] The magistrate in
the court below was of the view that it was not incumbent upon him to
address the issue of whether the non-disclosure
was fraudulent or
otherwise. It is clear from the
dictum
in
Van der Merwe
v Meades
that in order for a buyer to escape the consequences
of a
voetstoots c
lause it is incumbent on him to establish
fraud on the part of the seller.
[41] In my view the
magistrate erred in not addressing that issue and making a finding in
that regard. Having said that, I am inclined
to believe that had the
magistrate addressed this question he would have been constrained to
conclude that fraud had not been proved.
[42] All of this is of
course succinctly set forth in the the Supreme Court of Appeal’s
most recent judgment on these issues
in the
Odendaal
matter. I agree with appellant’s representatives, that the
magistrate erred in not following that decision when he gave his
judgment.
[43] In the premises I am
of the view that the appellant was sufficiently protected by the
voetstoots
clause in the contract of sale, to successfully
escape any liability with respect to latent or patent defects.
[44] It follows that the
appeal must succeed.
I propose an order in the
following terms:
ORDER:
The appeal is upheld
with costs.
The order of the
court below is set aside.
In its place there is
substituted the following order:
‘
The
plaintiffs’ claim is dismissed with costs.’
____________
CHILI AJ
I agree and it is so
ordered:
___________
STRETCH AJ
Appearances/..
Appearances /:
For the appellant
:
Mr R. Nirghin
Instructed by
:
Barry, Botha & Breytenbach Inc.
C/o Diedricks Attorneys
90C Roberts Road
Pietermaritzburg
Tel. 033 342 9808
For the respondents
:
Mr K. Gounden
Instructed by
:
Grobler & Moors
C/o Mason Inc.
251 Church Street
Pietermaritzburg
Ref. A. Yakoob
Date of Hearing :
20 May 2013
Judgment delivered on
:
17 October 2013