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[2020] ZASCA 24
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Auckland Park Theological Seminary v University of Johannesburg (1160/2018) [2020] ZASCA 24; [2020] HIPR 110 (SCA) (25 March 2020)
THE SUPREME COURT OF
APPEAL OF SOUTH AFRICA
JUDGMENT
Not
Reportable
Case
No: 1160/2018
In
the matter between:
AUCKLAND PARK THEOLOGICAL
SEMINARY
FIRST APPELLANT
WAMJAY HOLDINGS
INVESTMENTS (PTY) LTD
SECOND APPELLANT
and
UNIVERSITY OF
JOHANNESBURG
RESPONDENT
Neutral
citation:
Auckland Park Theological Seminary v University of
Johannesburg
(1160/2018)
[2019] ZASCA 24
(25 March 2020)
Coram:
PONNAN, VAN DER MERWE, MOLEMELA, DLODLO JJA and LEDWABA AJA
Heard:
24 February 2020
Delivered:
25 March 2020
Summary
:
Contract – terms agreed in writing – were rights and
obligations therein delectus personae – personal to appellant?
Parol evidence rule applied.
ORDER
On
appeal from
: Gauteng Local Division, Johannesburg (Van Oosten,
Carelse Wright JJ sitting as court of first instance):
1 The appeal is upheld
with costs.
2 The order of the full
court is set aside and replaced by:
‘
a. The appeal
succeeds with costs.
b.
The order of court below is set aside and substituted with: “The
plaintiff’s claim is dismissed with costs.’’’
JUDGMENT
Dlodlo
JA (Ponnan, Van der Merwe, Molemela JJA and Ledwaba AJA concurring):
[1]
The respondent, the University of Johannesburg (UJ), is the
registered owner of Portion 1 of Erf 809 Auckland Park Township,
situated at 51 Richmond Avenue, Auckland Park, Johannesburg (the
property). On 25 April 1996 the predecessor in title to UJ, the
Rand
Afrikaans University (RAU), applied to the Minister of Education in
terms of s 4(2) of the Rand Afrikaans University Act 51
of 1996 for
consent to let, inter alia, the property. The Minister granted his
approval in these terms:
‘
I hereby grant
permission for the Rand Afrikaans University to let certain specified
property, detailed drawings B1 to E1 for a
period of thirty years for
the purposes of developing theses properties’.
[2]
On 6 December 1996 UJ and the first appellant, the Auckland
Theological Seminary (ATS), concluded a written notarial long lease
in respect of the property (the lease). The lease was registered
against the title deed of the property on 20 December 1996 under
reference number K4963/1996. On 28 March 2011 ATS and the second
appellant, Wamjay Holding Investments (Pty) Ltd (Wamjay) concluded
a
written agreement of cession (the cession) in terms of which the
former ceded its rights (but not its obligations) in the lease
to the
latter. The cession was registered by Wamjay against the title deed
of the property on 13 April 2012 and it thereafter took
occupation of
the property.
[3]
During June 2012 Wamjay submitted detailed architectural plans to the
local authority for approval for the purposes of constructing
a
pre-primary, primary and high school with an Islamic ethos on the
property. On 3 September 2012 Wamjay furnished UJ with the
drawings
and artists’ impressions of the proposed school. On 5 October
2012 UJ purported to cancel the lease inter alia on
the basis that on
a proper interpretation of the lease the rights in the lease were
delectus personae
and personal to the ATS and therefore
incapable of cession. ATS, in ceding the rights had accordingly, so
the contention proceeded,
repudiated the lease, which repudiation had
been accepted by UJ.
[4]
UJ issued summons out of the Gauteng Division of the High Court,
Johannesburg for: (a) the eviction of ATS and Wamjay and all
persons
occupying the property through them and (b) the cancellation of the
notarial long lease against the title deed of the property.
The
matter proceeded to trial before Victor J, who concluded that ‘the
lease was one of delectus persona’. The learned
judge
accordingly issued, inter alia, the following order:
‘
The first and
second defendants and all persons occupying through or under them are
evicted from Portion 1 of Earth 809 Auckland
Park Township
registration division IR Province of Gauteng held under title deed
T9764/2009 situated at 51 Richmond Avenue Auckland
Park Johannesburg,
and they shall vacate the property by 30 November 2016. That the
third defendant is ordered to cancel the registration
of the notarial
long term lease agreement with registered reference number K4963/1996
registered against the title deed of Portion
1 of Earth 809 Auckland
Park Township registration division IR Province of Gauteng held under
title deed T9764/2009 situated at
51Richmond Avenue Auckland Park
Johannesburg’.
[5]
With the leave of Victor J, ATS and Wamjay appealed to the full court
of that division. Although the Judges, who heard the appeal
disagreed
in their approach, all three - Van Oosten J (with Carelse J
concurring) and Wright J - were in agreement that the appeal
should
fail. It was accordingly dismissed with costs. ATS and Wamjay now
appeal with the special leave of this court.
[6]
Although
there was agreement before Victor J that the matter turned on the
proper interpretation of the lease, the parties generated
a record in
excess of 800 pages. In all six witnesses testified; three for each
side. Almost all of the evidence was plainly inadmissible,
because as
Harms DP observed in
KPMG
v Securefin
:
[1]
‘
First, the
integration (or parol evidence) rule remains part of our law.
However, it is frequently ignored by practitioners and
seldom
enforced by trial courts. If a document was intended to provide a
complete memorial of a jural act, extrinsic evidence may
not
contradict, add to or modify its meaning . . . Second, interpretation
is a matter of law and not of fact and, accordingly,
interpretation
is a matter for the court and not for witnesses (or, as said in
common-law jurisprudence, it is not a jury question
. . .’.
[7]
In general,
when a contract has been reduced to writing, the writing is regarded
as the exclusive embodiment or memorial of the
transaction and no
extrinsic evidence may be given of other utterances or jural acts by
the parties which would have the effect
of contradicting, altering
adding to or varying the written contract.
[2]
In
National
Board,
[3]
this court referred with approval to the statement of Wigmore,
Evidence (1940) 3 ed 2425:
‘
.
. . In other words: when a jural act is embodied in a single
memorial, all other utterances of the parties on that topic are
legally immaterial for the purpose of determining what are the terms
of their act.’
[8]
Prima
facie, all contractual rights can be transmitted unless their nature
involves a
delectus
personae
or
the contract itself shows that they were not intended to be ceded.
[4]
The restriction on cession imposed by the
delectus
personae
concept
is simply a manifestation of the general principle that the cession
should not disadvantage the debtor.
[5]
Indeed, as Innes CJ stated in
Eastern
Rand Exploration Co v Nel
:
[6]
‘
Now, speaking
generally, the question of whether one of two contracting parties can
by cession of his interest, establish a cessionary
in his place
without the consent of the other contracting party depends upon
whether or not the contract is so personal in its
character that it
can make any reasonable or substantial difference to the other party
whether the cedent or the cessionary is
entitled to enforce it.
Subject to certain exceptions founded upon the above principle rights
of action may, by our law, be freely
ceded’.
[9]
As
Greenberg JP explained in
Boshoff
v Theron
:
[7]
‘
The position under
leases
in longum tempus
is not irrelevant to the present
question. Under such leases the lessee can free himself from his
obligations to the lessor by transferring
the lease. In Wessels on
Contract
(sec. 1739), it is stated that in a long lease, e.g.
for 99 years, the lessor does not expect that the obligations of the
lease
will be carried out personally by the lessee throughout the
whole term, and that there is therefore no
delectus personae
’
This
is true of an urban tenement. A tenant under an urban tenement may
accordingly cede the rights under a lease without the consent
of the
landlord, unless the terms of the lease forbids the tenant from doing
so.
[8]
[10]
Here, there was nothing in the lease itself that shows that ATS’
rights under the lease rights were not intended to be
ceded. UJ
sought to meet that difficulty by adducing oral evidence, under the
guise that such evidence was being introduced as
to context. Properly
construed, however, such evidence was introduced to add to, vary or
contradict the general words of the lease.
By virtue of the
integration or parol evidence rule, such evidence was plainly
inadmissible and should have been disallowed by
Victor J. As the
basis of UJ’s claim cannot be supported, the judgment in its
favour by Victor J cannot be sustained.
[11]
The parties
expressly agreed that no party may rely on any warranties or
representations not expressly included in the lease agreement.
They
agreed that the written lease is intended to be the sole memorial of
the agreement between themselves.
[9]
The lease agreement contained no express or implied provisions to the
effect that rights therein contained are personal to ATS.
On a proper
interpretation, the rights on the lease were not at all delectus
personae and personal to ATS and thus incapable of
cession. The terms
of the lease agreement are unambiguous. In deciding the meaning of a
contract, the court must have regard to
the words used. The words
must be construed objectively.
[10]
There is nothing in clause 8 of the lease agreement to justify an
assertion by UJ that the rights in the lease were personal to
ATS and
therefore incapable of cession.
[12]
In the result:
1. The appeal is upheld
with costs.
2. The order of the full
court is set aside and replaced by:
‘
a. The appeal
succeeds with costs.
b.
The order of court below is set aside and substituted with: “The
plaintiff’s claim is dismissed with costs.’’’
_____________________
DV DLODLO
JUDGE OF APPEAL
For appellant: G Kairinos
SC
Instructed
by: WP Steyn Attorney, Johannesburg
Honey
& Partners Incorporated, Bloemfontein
For
respondent: A R G Mundell SC, H C Bothma and K Reddy
Instructed
by: Webber Wentzel, Johannesburg
Symington
& De Kok, Bloemfontein
[1]
KPMG Charted Accountants (SA) v Securefin Ltd and Another
[2009]
ZASCA 7
;
2009 (4) SA 399
(SCA) para 39.
[2]
Johnson v Leal
1980 (3) SA 927
(A) at 938.
[3]
National Board (Pretoria) (Pty) Ltd and Another v Estate Swanepoel
1975 (3) SA 16
(A) at 26.
[4]
Frielander v De Aar Municipality
1944 AD 79
at 93.
[5]
Sasfin (Pty) Ltd v Beukes
1989 (1) SA 1
(A) at 31G-H; Goodwin Stable
Trust v Duchex (Pty) Ltd and Another
1998 (4) SA 606
(C) at 617I-J.
[6]
Eastern Rand Exploration Co Ltd v AJT Nel, JL Nel, SM Nel, MME Nel’s
Guardian and DJ Sim
1903 TS 42
at 53.
[7]
Boshoff v Theron
1940 TPD 299
at 304.
[8]
Lawsa (3ed) Vol 3 para 165.
[9]
See lease agreement clause 15.1 record page 46-47 vol 1.
[10]
Novaritis SA v Maphil Trading
[2015] ZASCA 111
; 2016 (1) 518; KPMG
Chartered para 39; Natal Joint Municipality Pension Fund v Endumeni
Municipality
[2012] ZASCA 13
;
2012 (4) SA 593
CC (A) para 8.