Gatri and Another v Badumelleng Brady Melk and Another (5363/2005) [2007] ZAFSHC 110 (26 April 2007)

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[2007] ZAFSHC 110
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Gatri and Another v Badumelleng Brady Melk and Another (5363/2005) [2007] ZAFSHC 110 (26 April 2007)

IN THE HIGH COURT
OF SOUTH AFRICA
(ORANGE
FREE STATE PROVINCIAL DIVISION)
Case No. : 5363/2006
In
the case between:-
SAMUEL
GATRI
First
Applicant
MATSELANE
ELISA GATRI
Second
Applicant
and
BADUMELLENG
BRADY MELK
First
Respondent
MOTLAGOMANG
MAGGIE MELK
Second
Respondent
JUDGMENT
BY:
C.J.
MUSI J
_____________________________________________________
HEARD
ON:
29
MARCH 2007
_____________________________________________________
DELIVERED
ON:
26
APRIL 2007
_____________________________________________________
[1] The
applicants seek the following order:
“
1. That
the Respondents be ordered and directed, to sign any and all
necessary transfer documents, in order to
effect
transfer of Erf 3410, Ashbury Extension 6, district Bloemfontein,
Free State Province.”
2. In
the event, of the Respondents failing to sign the aforesaid
documents, that within 10 days after the granting of this order,
that
the Registrar of this Honourable Court, be directed and authorized to
sign any and all documents necessary, to effect transfer
of the said
erf.
3. That the Respondents be ordered to
pay the costs of this application.”
[2] Before dealing with
the merits I pause to record that the respondents applied for
condonation for the late filing of their opposing
affidavits. They
filed it two days late. They also tendered the cost of the
application. The application for condonation was not
opposed.
Condonation was granted with costs.
[3] It is common cause
that the respondents are the owners of the property mentioned in
paragraph one above.
[4] The
applicants aver that they entered into a written agreement to buy the
said property from the respondents. The applicants
attached the
purported agreement to their application. The respondents denied
that they were party to the agreement. They specifically
deny that
they signed the agreement.
[5] Ms Eloff, on behalf
of the respondents, also challenged the validity and enforceability
of the said agreement on various grounds.
Mr. Grobler, on behalf of
the applicants, argued that the contract is valid and enforceable.
[6] Although the
respondents deny signing the document I will for the purposes of this
judgment accept, without deciding, that they
indeed signed the
document. Having disposed of that issue the main issue that falls to
be decided is whether the agreement is of
any force or effect.
[7]
Section
2(1)
of the
Alienation of Land Act, 68 of 1981
, reads as follows:
“
No alienation of land after the
commencement of this 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.”
The
purpose of the legislature – as is clear from the authorities –
is to achieve certainty in transactions of considerable value
and
importance in regard to terms and conditions agreed upon which are
often intricate and complex. This reduces the risk of perjury,
fraud
and unnecessary litigation.
WILKEN
v KOHLER
1913 AD 135
;
CLEMENTS
v SIMPSON
1971 (3) SA 1
(A) at p.7;
RAVEN
ESTATES V MILLER
1984 (1) SA 251
(W) at p. 255 D – E.
[8] In
JOHNSTON
v LEAL
1980 (3) SA 927
(AD) the Court dealt with one of the predecessors of
Act 68 of 1981
viz
section 1(1) of Act 71 of 1969 which is in essence the same as the
current section. In
JOHNSTON
v LEAL
,
supra
at 939 Corbett JA, as he then was, said:
“
One of the
consequences of the application of s 1 (1) is that where the parties
have entered into a written contract for the sale
of land, but it
appears ex facie the writing that a material term has been left
inchoate, as, for example, where the writing expressly
states that
the term is to be agreed upon later by the parties, the contract by
itself is of no force or effect and cannot sustain
a cause of
action.”
[9] Ms
Eloff argued that the agreement
in
casu
is inchoate because the identity of the parties is not clear or they
are not identifiable, the
merx
is not properly described and the mode of payment is undetermined.
Mr. Grobler condeded that the description of the
merx
and the identity of the parties were not properly dealt with in the
document. He, however, submitted that the parties are identifiable
and that there can be no uncertainty in relation to the
merx
because Erf 3410 sufficiently describes the property. He argued that
extrinsic evidence is in any event admissible to show that
the
parties are identifiable. Likewise, so he argued, extrinsic evidence
is admissible to show that the parties agreed on a particular
mode of
payment, being a mortgage bond.
[10] In
JOHNSTON
v LEAL
,
supra
at 938 B – C it was said that:
“
Generally
speaking these terms - and especially the
essentialia
- must be set forth with sufficient accuracy and particularity to
enable the identity of the parties, the amount of the purchase
price
and the identity of the subject-matter of the contract, as also the
force and effect of other material terms of the contract,
to be
ascertained without recourse to evidence of an oral consensus between
the parties ...”
Recourse
to oral consensus and extrinsic evidence can be taken in certain
limited circumstances. In
JOHNSTON
v LEAL
,
supra
the Court considered one of the limited circumstances in which
recourse to evidence could be taken. The general rule is that a
party
to a contract which has been integrated into a single and
complete written memorial may not contradict, add, amend or modify
the
contract by reference to extrinsic evidence and in that way
redefine the terms of the contract. See
JOHNSTON
v LEAL
,
supra
at 943 B – C. In
JOHNSTON
v LEAL
,
supra
it was decided that evidence could be adduced to explain an overt
lack of completeness in the document and to determine what has
been
integrated with a view to deciding upon the validity of the document
as it stands. See p. 943 F. The extrinsic evidence as
to why
particular clauses on a printed contract were left open was allowed.
It was not allowed to amend, redefine or modify the
contract but to
ascertain why certain clauses were left blank. Mr. Grobler’s
contention that extrinsic evidence is admissible
to prove material
terms of the contract is patently wrong.
[11] In my view this
whole matter can and should be decided on one point only. I hasten
to deal with that point. Clause 2 of the
contract reads as follows:
“2. PURCHASE
PRICE
The purchase price is the sum of R350
000-00 (exclusive* inclusive* of the Value Added Tax) Payable by the
Purchaser to the Seller
as follows:
THE PURCHASER WILL INFORM THE SELLER
ON THE EIGHTH DAY FROM THE DATE OF THE SIGNATURE ABOUT FURTHER
TRANSACTION ...”
Clause 12 which deals
with mortgage bond reads as follows:
“12. MORTGAGE
BOND
This Agreement is
subject to the suspensive condition that a loan of R
............................ secured by a Mortgage to be
registered
over the property is obtained by the Purchaser or the Seller on his
behalf on the normal terms and conditions of any
Registered
Commercial Bank within a period of fourteen (14) days from the 1
st
date of signature hereof or such extended period as the parties may
agree in writing.”
[12] The
mode of payment of the purchase price is not stipulated in the
agreement. Christie RH :
The
Law of Contract in South Africa
5
th
Ed at 122 stats that:
“
The
method of payment of the price is also an essential or at least a
material term, so a written contract that leaves the method
of
payment vague or leaves it over for further negotiation is
void
and therefore cannot be rectified, ...”
This
view is in sync with a long line of cases. In
DU
PLESSIS v VAN DEVENTER
1960 (2) SA 544
(A) at 551 A it was said:
“
Volgens art. 1
(1) van Wet 68 van 1957 is skrif by 'n verkoopkontrak ten opsigte van
grond 'n geldigheidsvereiste, en volgens
Kuper
v Bolleurs
,
1913 T.P.D. 334
, en
van
der Berg v Leggelo
,
1935 T.P.D. 304
, val 'n voorsiening betreffende die wyse van betaling
van die koopprys onder die bedinge wat op skrif gestel moet word.”
See
also
PATEL
v ADAM
1977 (2) SA 653
(AD) at 666 A. In
ENGELBRECHT
v NEL
1991 (2) SA 549
(W) at 552 A it was held that:
“
The method of
payment is a material term of the agreement which cannot be postponed
for later negotiation. Hence the agreement would
be void for
uncertainty.”
[13] If
one has regard to clause 2 of the agreement in this matter it is
difficult if not impossible to discern what the parties contemplated.
It is not clear what the further transaction is that the purchaser
will inform the seller about. It is not clear whether the purchase
price will be paid in cash or by other means. It is not clear when
the purchase price will be paid. The matter is further compounded
by
the fact that clause 12 which deals with mortgage bond is blank.
Evidence to show that the agreed mode of payment was cash is
inadmissible. See Christie RH,
supra
at
122 and the cases cited therein. In any event
“
When,
on the facts, the parties cannot be said
to
have contemplated payment in cash, their failure properly to reduce
to writing the mode of payment which they did in fact contemplate
will render the contract invalid”
per
Page J in
DOLD
v BESTER
1984 (1) SA 365
(D & CLD) at 369 D – E.
[14] The
method of payment was clearly left to be negotiated at a future date.
It is clear that the essential particulars in respect
of method of
payment was not yet agreed upon and was left open for future
agreement between the parties. This is, in my view, for
the reasons
stated above, not a valid and enforceable contract. That said I do
not deem it necessary to deal with Ms Eloff’s other
interesting and
relevant arguments in relation to the invalidity of the agreement.
The application ought to be dismissed.
[15] There
is no reason why the costs should not follow the event. The
respondents were successful and are entitled to their costs.
[16]
Consequently
I make the following order:
The
application is dismissed with costs.
___________
C.J. MUSI, J
On behalf of the
applicants: Adv. S. Grobler
Instructed
by:
Azar
& Havenga Attorneys
BLOEMFONTEIN
On
behalf of the respondents: Adv. Z. Eloff
Instructed by:
Matshidiso
Attorneys
PRETORIA
c/o
Saffy & Associates
BLOEMFONTEIN
/sp