President Steyn Goldmines (Free State) (Pty) Ltd v Charnina Investments (Pty) Ltd and Others (5185/2006) [2007] ZAFSHC 2 (18 January 2007)

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[2007] ZAFSHC 2
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President Steyn Goldmines (Free State) (Pty) Ltd v Charnina Investments (Pty) Ltd and Others (5185/2006) [2007] ZAFSHC 2 (18 January 2007)

IN THE HIGH COURT
OF SOUTH AFRICA
(ORANGE FREE STATE
PROVINCIAL DIVISION)
Case No. : 5185/2006
In
matter between:
PRESIDENT STEYN
GOLD MINES
(FREE STATE) (PTY)
LTD
Applicant
and
CHARNINA
INVESTMENTS (PTY) LTD
1
st
Respondent
ADAM ERIC
COETZEE
2
nd
Respondent
ALL
LESSEES/OCCUPIERS OF NO 1 HOSTEL,
PRESIDENT
STEYN MINE WELKOM
3
rd
Respondent
HEARD ON:
14
DECEMBER 2006
JUDGMENT BY:
C.J.
MUSI, J
_____________________________________________________
DELIVERED ON:
25
JANUARY 2007
[1] On 7 December 2006 my
brother H.M. Musi J issued a rule nisi calling upon the first
respondent to appear and show cause on 14
December 2006 why orders to
the following effect should not be made:
“
2.1 that
the first respondent be and is hereby prohibited from:
effecting any alterations to.
Demolishing or afflicting damages to
any structures or buildings or part of buildings on the premises or
complex of.
Removing any fixtures or property or
building materials or copper cables or any items from the premises.
Of the No 1 Shaft Hostel, President
Steyn Mine, Welkom, without the written authorisation and permission
of the General Manager of
the applicant, pending the final
adjudication and outcome of the action between the applicant and the
first respondent instituted
in the above Honourable Court under case
number 5109/2006.
that the first respondent be and is
hereby prohibited from allowing any persons whose names do not
appear on the “list of occupants
on the No 1 Shaft Hostel” as
referred to in prayers 3 below, to occupy the No 1 Shaft hostel,
pending the final adjudication
and outcome of the action between
the applicant and the first respondent instituted in the above
Honourable Court case number
5109/2006.
that the costs of this application
shall be costs in the action, but that the costs of opposition
hereto, if any, be paid for
by the first respondent.
that such further and/or alterative
relief be granted to the applicant as the Honourable Court may deem
fit.
the first respondent forthwith
compile a list containing the following particulars of all persons
presently occupying the No 1
Shaft Hostel (herein referred to as
“the list of occupants of the No 1 Shaft Hostel”) and to submit
the said list to the
General Manager of the applicant mine on or
before 12h00 on Wednesday 20 December 2006…”
[2] The applicant
instituted an action, in this Court, against the first respondent.
In the action the plaintiff/applicant claimed
inter alia for an order
ejecting the defendant from Hostel No 1 President Steyn Mine, Welkom
and an order authorising the plaintiff
to retain the amount of R600
000.00 paid by the defendant to the plaintiff as “rouwkoop” or
penalty or predetermined damages.
[3] The second
respondent, Adam Eric Coetzee, who is the sole shareholder and
director of the first respondent used to work for the
applicant as a
manager until 5 June 2006. No relief is sought against the second
and third respondents.
[4] During 2005 the
applicant experienced financial difficulties and had to sell some of
its assets. On 12 October 2005 the applicant
represented by its
general manager, Mr Johan Vorster, accepted the first respondent’s
offer to purchase number one shaft hostel
(the property) for R800
000.00. On 15 January 2006 first respondent paid R600 000.00 to the
applicant. On 16 January 2006 the first
respondent took occupation
of the property.
[5] On 31 March 2006 the
applicant represented by Gerhard Geyser, an engineering manager, who
left the employ of the applicant on
3 August 2006, and the first
respondent represented by the second respondent entered into an
agreement entitled Concept Heads of
Agreement of Sale, because the
property could not be accurately described as it still had be
subdivided.
[6] The
relevant terms of the agreement were:
6.1 That the balance of
the the purchase price, R200 000.00 will be paid by the first
respondent on or before 30 April 2006.
6.2 That the first
respondent is entitled to occupy the property from the date on which
the purchase consideration was effected.
6.3 That
no occupational rent was payable by the first respondent.
6.4 that
all benefits and risk in and to the property shall pass to the first
respondent on transfer of the property.
6.5 Should
the first respondent breach the agreement and fail to remedy such
breach within 10 (ten) days after the date of receipt
of written
notice requiring the first respondent to do so, the applicant shall
be entitled to cancel the agreement and to retain
any amount paid as
a rouwkoop or by way of a penalty.
[7] The first respondent
failed to effect payment of the outstanding balance of the purchase
consideration on or before 30 April 2006.
First respondent however
alleges that the date of 30 April 2006 was included in the agreement
because the bank needed a date of
payment in order to consider the
loan application. Second respondent further alleges that the
agreement between him and Geyser was
that the balance R200 000.00
will be paid on registration of the property.
[8] The first respondent,
in breach of the agreement, undertook major alterations and
renovations to the property. The first respondent
also excavated
copper cabling on the surrounding land and sold it as scrap metal in
order to fund its alterations and renovations
to the property. First
respondent also removed bricks from buildings on the property and
used those bricks to effect alterations
and renovations.
[9] Notwithstanding
demand, the first respondent refuses to vacate the premises or to
refrain from excavating cabling and selling
same as scrap metal.
[10] After numerous
discussions, negotiations and exchange of letters the applicant
brought this application on an urgent basis.
The first respondent is
of the view that there is no urgency in this matter.
[11] Mr Van Rhyn SC on
behalf of the first and second respondents argued that this matter is
not urgent because on the applicants
own case it knew since August
2006 that cabling is being excavated by employees of the first
respondent. On 4 October 2006 a security
officer of the applicant
also saw cabling being removed by the first respondent’s employees.
He confronted the second respondent
and his wife about this and
reported the incident to his superior on 9 October 2006. Mr Van Rhyn
also pointed out that the applicant
also states that the second
respondent was repeatedly requested to refrain from demolishing the
property of the applicant and to
refrain from cutting up and selling
electric cables. Mr Van Rhyn argued that the delay in bringing this
application is unreasonable
in the light of the fact that the
applicant knew from, at least, August 2006 that buildings are being
demolished and cables are being
removed by the second respondent.
[12] Mr
Ploos Van Amstel SC on behalf of the applicant argued that there was
no undue delay in launching the proceedings. The application
was
ultimately brought after protracted negotiations and exchange of
letters could not yield the desired result.
[13] It is trite that
applications for interdicts
pendente lite
requires the maximum
expedition on the part of an applicant. The Court has an overriding
discretion whether to grant or refuse an
interim interdict. See
Yusuf v Abboobaker and Pietermaritzburg Local Road
Transportation Board
1943 (NPD) 244 at 247;
Juta &
Co. LTD v Legal & Financial Publishing Co. LTD
1969 (4)
SA 443
(C);
Chopra v Avalon Cinemas SA (PTY) LTD and Another
1974 (1) SA 469
at 472 H.
[14] It is common cause
that there were negotiations in order to settle this matter without
instituting legal proceedings. Although
the first respondent is of
the view that the negotiations finally broke down on 11 November 2006
it is clear that it only broke down
on 14 November 2006. The
applicant’s attorney wrote to the first respondent’s attorney on
14 November 2006 and stated the following:
“
Our client is of the opinion that
further round table discussions will not resolve the issues in
dispute, especially in view of our
client’s cancellation of the
agreement.”
The first respondent’s
attorneys responded on 21 November 2006. They were still desirous to
continue the negotiations. They wrote
to the applicant’s attorney
and stated:
“
U
word weereens uitgenooi na samesprekengs (sic) soos wat bespreek is
tussen u meneer Peyper op skrywe hiervan op 13 November 2006,
ons
bemerk egter dat u in die skrywe van 14 November meld dat dit nie
gehou kan word nie in die lig van die kansellasie. Moontlik
sal dit
nou meer relevant wees vir u klient om wel die
rondetafelsamesprekengs (sic) by te woon.”
[15] The first respondent
does not deny that it gave a firm undertaking to desist from any
alterations or demolishing of buildings
or the excavation of copper
cable and the selling thereof pending the negotiations. The first
respondent admits that a pump station
was demolished on 23 November
2006 in order to use the bricks for renovations or improvements.
[16] It is in my view
clear that the applicant tried its best to settle this issue
amicably. The undertaking of the first respondent
to desist from
removing copper cables and from demolishing buildings pending the
negotiations was indeed sufficient reason for the
applicant to think
that there was a genuine willingness on the part of the first
respondent to settle the matter. The source of
risk was therefore
temporarily absent. It is only when the demolishing activities
resumed on 23 November 2006 that the South African
Police Services
were called. Esme Kennedy who is the applicant’s legal adviser
consulted an attorney as well as counsel on Wednesday
29 November
2006 being the first day on which she could do so because she had
commitments in Johannesburg on 27 and 28 November 2006.
There might
have been a delay but the explanation therefore is acceptable. I
detect no dilatory conduct by the applicant. There
was no undue
delay in launching these proceedings on 5 December 2006. In any
event it is clear that it is in the interest of justice
that this
matter be dealt with on a urgent basis. To dismiss this application
for lack of urgency would not be in the interest of
justice. It
would unnecessarily rob this Court of the opportunity to dispose of
the matter. The attractiveness of justly and finally
disposing of
this matter in the interest of justice appeals to me. Why should the
application be prosecuted de novo when the first
respondent does not
allege in any event that the urgency worked to its prejudice. This
application was, in my view, properly brought
on an urgent basis.
[17] The requirements for
an interim interdict are:
(a) a prima facie right;
(b) a well-grounded
apprehension of irreparable harm if the interim relif is not granted
and the ultimate relief is
eventually granted;
(c) that the balance of
convenience favours the granting of an interim interdict; and
(d) that
the applicant has no other satisfactory remedy.
In
view of the discretionary nature of an interim interdict
these
requisites are not judged in isolation and they interact.
See
LAWSA Vol 11
first Reissue
p291 – 292 paragraph
316.
[18] A prima facie right
can be established even if it is open to some doubt. The proper
approach is to consider the facts as set
out by the applicant
together with any facts set out by the respondent which the applicant
cannot dispute, and to decide whether,
with regard to the inherent
probabilities and the ultimate onus, the applicant should on those
facts obtain final relief at the trial.
The facts set up in
contradiction by the respondent should then be considered, and if
they throw serious doubt on the applicant’s
case he cannot succeed.
See
LAWSA
supra
paragraph 317 and the cases
cited thereat.
[19] The applicant argued
that Gerhard Geyser who signed the “Concept Heads of Agreement of
Sale” on behalf of the applicant had
no authority or mandate from
the applicant’s Board of Directors to do so. It was further argued
that Geyser had no written authority
to act on the applicant’s
behalf and therefore the purported alienation of land is of no force
and effect, in terms of the provisions
of section 2(1) of the
Alienation of Land Act, No 68 of 1981 (the Act). Section 2(1) of the
Act reads as follows:
“
No alienation of land after the
commencement of the section shall, subject to the provisions of
section 28, be of any force or effect
unless it is contained in a
deed of alienation signed by the parties thereto or by their agents
acting on their written authority.”
[20] In view of the
conclusion that I have reached in relation to another aspect of this
matter I do not deem it necessary to decide
whether Geyser had or
ought to be deemed to have had authorisation written or otherwise to
enter into a land alienation agreement
on behalf of the applicant. I
will, for the purposes of this matter accept, in the first
respondent’s favour, that he did have
the necessary authorisation.
[21] It is common cause
that the applicant is still the registered owner of the property.
The applicant’s averment that Peyper,
the applicant’s attorney,
advised both Geyser and Coetzee that the land on which the property
was situated still had to be subdivided
and that the property could
therefore not be described accurately and that a final agreement of
sale would have to be drawn up and
signed by the parties subsequent
to such subdivision is in my view in sync with Peyper’s subsequent
actions. Because of this impediment
he only drafted a “Concept
Heads of Agreement of Sale.” It is clear from the heading of this
document that it was indeed only
meant to be a preliminary or draft
agreement of sale. In fact on 9 October 2006 Peyper summarised the
discussions that took place
between him, Geyser and Coetzee in their
representative capacities at his offices. This is, inter alia, how
he captured the discussions:
“
We
confirm that
inter
alia
the following transpired during our abovementioned discussions:
1. Mr Geyser of President Steyn Gold
Mines instructed writer in your presence during our 12:00 discussions
to draft a sale agreement
in terms whereof Charnina Investment
purchase the hostel building situated at President Steyn Gold Mines’
No 1 shaft from President
Steyn Gold Mines.
2. Writer
from the outset advised both yourself and Geyser that it would not be
appropriate and/or possible to draft a final agreement
of sale
without a proper description of the land on which the hostel was
erected (hereinafter referred to as the “property”)
as reflected
in title deed.
3. Both
Geyser and yoursedlf informed writer that no title deed was readily
available for the purposes of drafting the agreement due
to the fact
that the land on which the property was erected still had to be
subdivided and that it will accordingly only be possible
to describe
the property accurately, after the subdivision has been attended to
and registered in the Deeds Office.
4. Geyser and yourself hereafter
requested writer to draft
some sort
of agreement due to
inter
alia
the following.
4.1 the parties have agreed in
principle to bind themselves for the sale of the property for a
purchase consideration in the amount
of
R800 000.00
(eight
hundred thousand rand);
4.2 Charnina
Investments have already paid an amount of
R600 000.00
(six
hundred thousand rand) to President Steyn Gold Mines in respect of
the purchase consideration;
4.3 Charnina
Investments agreed to settle the balance of the purchase
consideration on or before
30 April 2006
, notwithstanding the
date of registration of the property in the name of Charnina
Investments;
4.4 Charnina
Investments required
some sort
of confirmation of the
agreement between the parties for purposes of acquiring financial
assistance from Nedcor.
5. We hereafter agreed that writer
will draft a concept agreement reflecting
inter alia
:
5.1 the sale transaction;
5.2 the
purchase consideration;
5.3 the payment made by Charnina
Investments on
15 January 2006
;
the agreement that the balance of
the purchase consideration will be settled on
30 April 2006
;
the agreement in respect to the
occupation of the property.
Writer specifically informed both
Geyser and yourself that a further final agreement of sale will have
to be drafted and signed
by both parties for purposes of registering
the property in the name of Charnina Investments.
We adjourned our discussions until
14:00 on the same day in order to afford writer an opportunity to
draft a preliminary concept
agreement.
The concept heads of agreement of
sale annexed hereto and marked Annexure
“A”
was signed on
your return to our offices at approximately 14:15 by yourself on
behalf of Charnina Investments and Geyser on behalf
of President
Steyn Gold Mines.”
[22] The first respondent
handed this letter over to his attorneys Neumann van Rooyen Sesele.
In response to that letter the first
respondent’s attorneys wrote
the following:
“
Ons bevestig die inhoud van u
skrywe van 9 Oktober 2006 gerig aan ons kliënt en stem saam dat dit
in wese korrek is.
Dit is egter jammer dat die kliënte
nie gewys is op die gevolge van die oorbetaling van gelde voor
registrasie Okkupasiehuur ens.
nie.
Ons
ontvang graag dringend van u die konsepooreenkoms sowel as ‘n
konsepkaart van die eiendom wat getransporteer moet word.”
The above makes it
abundantly clear that the understanding between the parties was that
a final agreement would be drafted after the
impediment in relation
to subdivision has been eradicated. I agree with Mr Ploos Van Amstel
that a material term of the contract
of sale of land has thus been
left inchoate in that the identity of the subject matter of the
agreement was to be agreed upon at
a later stage by the parties. See
Johnston v Leal
1980 (3) SA 927
(AD) at 937 – 938.
It is therefore not a source of surprise to me that the first
respondent’s attorney wrote on 9 May 2006 to
the applicant’s
attorney that:
“
Die eiendom soos omskryf in die
kontrak bestaan nie. Die eiendom wat verkoop word is ‘n gedeelte
van ‘n plaas wat eers onderverdeel
moet word, voordat ‘n
transaksie kan voortgaan. Ons sou by paragraaf 1 van die kontrak
gevoeg het dat die eiendom nog onderverdeel
moet word en dat die
proses aan die koper verduidelik is…”
[23] In my view the
concept agreement is of no force or no effect. It is clear to me
that the applicant should on these facts obtain
final relief at the
trial.
[24] In vindicatory
claims, such as this one, the principle is that the court is entitled
to ensure that the property will be preserved
until the dispute is
decided. It is therefore factually presumed until the contrary is
shown that the applicant will suffer irreparable
harm if the
interdict is not granted. See
UDC Bank Ltd v Seacat Leasing &
Finance Co. (Pty) Ltd
1979 (4) SA 682
(T) at 688 G – 689 A
– C.
Stern & Ruskin v Appleson
1951 (3) SA 800
(W) at 810.
[25] The first respondent
argued that the balance of convenience favours the refusal of the
interim interdict. It points out that
it occupies the property since
18 January 2006. That the first respondent has incurred high
expenses and costs to preserve and improve
the buildings. The first
respondent has incurred debt in order to improve the buildings.
These costs can only be recouped if the
property can be leased to its
full capabilities. I do not agree that the balance of convenience
favours the first respondent. The
parties agreed that no alterations
shall be done to the Property prior to registration of transfer.
Irrespective of this clause
in the “agreement” the first
respondent went ahead and made alterations prior to registration of
transfer. He received rental
income from the property. In fact he
will still continue to do so even if the applicant is given interim
relief. In order to effect
the improvements the first respondent
excavated copper cables and sold it as scrap. It used bricks from
existing buildings which
still belonged to the applicant in order to
effect improvement so that it could improve its earning potential.
The more lease agreements
it signs the more costly it will become for
the applicant if it is successful in its action for eviction. The
applicant will have
to secure alternative accommodation for more
people. If the applicant knows exactly how many families or people
are currently living
on the property it will be better able to assess
its options. The applicant merely wants the first respondent to
desist from demolishing
its buildings; from removing building
materials; from removing cabling and from allowing more people to
occupy the property. The
current income of the first respondent from
the property will not be stopped or jeopardised. In terms of section
28 of the Act the
first respondent is in any event entitled to
reasonable compensation for the necessary expenditure that it
incurred in regard to
the preservation of the land or any
improvements thereon.
[26] I am also in
agreement with Mr Ploos van Amstel, and it was not disputed by Mr Van
Rhyn, that the applicant has no other adequate
remedy.
[27] In
my view the applicant has shown that it is entitled to the relief
that it seeks in its notice of motion. The date of 20 December
2006
has however been overtaken by events. It ought to be adjusted.
[28] There
is also no reason why the costs should not follow the event in this
matter.
[29]
In the
circumstances the following order is made:
1. The rule nisi is
confirmed and it is specifically ordered that:
1.1 the first
respondent be and is hereby prohibited from:
effecting any
alterations to,
demolishing or
damaging any structures
or
buildings or part of buildings on the
premises
or complex of,
Removing
any fixtures or property or
building
materials or copper cables or
any item from the
property situated at No 1 Shaft Hostel, President Steyn Mine,
Welkom, without the written authorisation and permission
of the
General Manager of the applicant, pending the final adjudication and
outcome of the action between the applicant and the first
respondent
instituted in the above Honourable Court under case number 5109/2006.
the first respondent
be and is hereby prohibited from allowing any persons whose names
do not appear on the “list of occupants
on the No 1 Shaft Hostel”
as referred to in 1.3 below, to occupy the No 1 Shaft hostel,
pending the final adjudication and
outcome of the action between
the applicant and the first respondent instituted in the above
Honourable Court case number 5109/2006.
the first respondent
forthwith compile a list containing the following particulars of
all persons presently occupying the No 1
Shaft Hostel (herein
referred to as “the list of occupants of the No 1 Shaft Hostel”)
and to submit the said list to the
General Manager of the applicant
mine on or before 12h00 on Wednesday 31 January 2007:
1.3.1 name of
person.
1.3.2
gender.
1.3.3
identity number.
1.3.4
date of birth.
1.3.5
residential address.
1.3.6 room or unit
or apartment number in
No
1 Shaft Hostel.
1.3.7
capacity, i.e. lessee or unlawful
occupant.
2. The first
respondent is ordered to pay the cost of the application on an
opposed basis.
____________
C.J.
MUSI, R
Namens
die eiser: Adv. C. PLOOS VAN AMSTEL SC
In
opdrag van:
Peyer
Attorney Inc
BLOEMFONTEIN
Namens
die verweerders: Adv. A.J.R. VAN RHYN SC
In
opdrag van:
Naudes
BLOEMFONTEIN
/ms