Manna v Lotter and Another (9708/04_) [2007] ZAWCHC 13; [2007] 3 All SA 50 (C); 2007 (4) SA 315 (C) (8 March 2007)

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[2007] ZAWCHC 13
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Manna v Lotter and Another (9708/04_) [2007] ZAWCHC 13; [2007] 3 All SA 50 (C); 2007 (4) SA 315 (C) (8 March 2007)

22
9708/04
In
the matters between:
enrico
pietro manna
Applicant
and
jane
mary lotter
First Respondent
registrar
of deeds
Second
Respondent
judgment:
delivered 8 March 2007
Griesel
J:
This
is an application to enforce specific performance of an alleged deed
of sale entered into between the applicant (
the buyer
) and
the first respondent (
the seller
) during November 2003 in
respect of erf 3649 Sedge­field (
the property
). The
second respondent is the Registrar of Deeds, who played no active
part in these pro­ceedings.
Factual
background
The
seller, a
peregrinus
of the Republic who is permanently
resident in Wales, is the owner of the property. During October 2003
she mandated an estate agent
to find a buyer for the property. In
due course, the agent procured a written offer from the present
buyer to purchase the property
for a price of R485 000. The
offer to purchase was signed by the buyer in Pretoria on 6 November
2003 and was returned by
fax to the agent in Sedgefield, where the
seller’s husband signed it on the same date. (It is common cause,
however, that he
was not a party to the transaction and that his
signature is legally irrelevant.) After filling in various details
which had until
then been left blank in the offer – such as the
identity of the seller, the name of the seller’s conveyancers, and
so on –
the agent faxed the document to the respondent in Wales,
who signed and returned it to the agent on 12 November 2003.
One
of the blank items completed by the agent, was the expiry date in
clause 10, which reads as follows (the underlined portion
having
been filled in by the agent in manuscript):
‘
10. Validity
& entire contract
This offer is irrevocable and expires at
noon on the
8
th
November 2003
and on
acceptance shall become a binding Agreement of Sale irrespective of
whether the Purchaser has been notified of such acceptance
or not.
…’
Notwithstanding
the fact that the offer was only ‘accepted’ by the seller on 12
November, i.e. after it had lapsed, both parties
initially believed
that a valid and binding agreement had been concluded. When called
upon by the conveyancers to sign the necessary
transfer documents,
however, the seller failed to respond to their repeated efforts to
make contact with her and also failed to
sign the documents that had
been sent to her by the conveyancers. (Not without some
justification, the buyer attributes the seller’s
apparent change
in attitude to what is colloquially known as ‘seller’s remorse’
in a rapidly escalating property market.)
Matters
eventually came to a head when the present application was launched
by the buyer more than a year later, after the necessary
leave to
sue by way of edictal citation had been obtained. In her answering
affidavit (
jurat
7 January 2005), the seller for the first
time adopted the attitude that the deed of sale was void for two
reasons: (a) she
had accepted the offer only after it had
lapsed; and (b) the suspensive condition regarding the buyer’s
obtaining bond finance
for the transaction had not been fulfilled.
In addition, the seller argued
in limine
that, in the absence
of an attachment of property
ad con­firmandam
juris­dictionem,
this court does not have jurisdiction to
hear this matter in view of her status as a
peregrinus
.
Jurisdiction
Dealing
with the last aspect first, the procedure of an attachment to
confirm jurisdiction has its origin in the doctrine of
effectiveness,
which is described in
Sonia (Pty) Ltd v Wheeler
1
as ‘the basic principle of jurisdiction’.
2
In other words, it is necessary in appropriate cases to attach
property to confirm jurisdiction in order to render effective any
judgment or order that the court may eventually make. It follows
that, if the court can give an effective judgment without an

attachment having taken place, such attachment would be
unnecessary.
3
The
seller relied on two decisions of the erstwhile Appellate Division,
viz
Thermo Radiant Oven Sales (Pty) Limited v Nelspruit Bakeries
(Pty) Limited
4
and
Ewing MacDonald & Co Ltd v M & M Product Co
,
5
in both of which it was held that attachment to confirm jurisdiction
was a necessary pre­requisite in proceedings against a
peregrinus
. Both those matters, however, dealt with claims
sounding in money, whereas the present matter concerns a claim for
the transfer
of immovable property situated within the area of
jurisdiction of this court. With regard to this latter type of
claim, different
considerations apply. Generally speaking, in any
claim relating to immovable property – whether
in rem
or
in
personam
– the court within whose territorial jurisdiction the
property is situated (the
forum rei sitae
) will
always
have jurisdiction to entertain such claims. In such cases, it is
then irrelevant whether the defendant is an
incola
or a
peregrinus
. This principle has been accepted in this Division
as long ago as 1848, in the old case of
Palm v Simpson
,
6
where it was held that  –
‘
a
claim to rescind a contract for the sale of immovable property can
be effectively dealt with by the Courts of the State in which
the
property is situate. Such State has complete control over the
property and can therefore effectively release a person from
his
obligation to transfer or to take transfer of the property. It
follows that in an action in which a judgment rescinding a contract
to transfer immovable property is claimed it is a sufficient basis
for jurisdiction that the property is situate within the State
in
whose Court the action is brought.’
A
similar conclusion was reached in
Jackaman and Others v Arkell,
7
where Roper J stated in unambiguous terms:
‘
In
my opinion the true position is that when the immovable property is
situated within the Court’s territory, the Court has jurisdiction
wherever the defendant may be (see Pollak,
Juris­diction
,
pp 103
et seq
.),
and therefore it is not necessary to attach the property as well as
to obtain leave to sue by edict.’
The
learned judge proceeded as follows:
8
‘
It
does not follow, however, that the applicants are not entitled to an
attachment if they ask for it. The Dutch Courts made arrests
of the
person or property of a
peregrinus
not merely in order to vest themselves with jurisdiction, but also
in order to protect the rights of the
incola
by putting pressure on the foreigner, and, in effect, by giving the
incola
security in
advance for execution for his debt.’
In
Sonia (Pty) Ltd v Wheeler
,
9
the court commented as follows on the above-quoted passage from
Palm’s
case:
‘
We
were not referred to any case in which the decision in
Palm’s
case was adopted and applied, but it has apparently never been
queried or criticised and has stood as a correct exposition of the
law for over a hundred years. It seems to me to be too late now to
query the law as laid down in that case. Moreover the decision
can
be supported on grounds of principle, convenience and common sense.’
Applying
the law as articulated in these cases, it is clear that it was not
necessary for the buyer in the present case to have
applied for
attachment of the seller’s property in order to confirm the
jurisdiction of this court. The property in question
is situated
within this court’s area of jurisdiction, with the result that it
is immaterial where the respondent may find herself.
In
any event, bearing in mind that ‘(a) court’s juris­diction
in respect of claims relating to property is largely a question
of
effectiveness’,
10
there is a further cogent reason why the seller’s objection to the
jurisdiction of this court cannot be upheld: As part of the
order
granting the buyer leave to sue by way of edictal citation,
11
an interim interdict was granted, ‘restraining the [seller] from
trans­ferring [the property] … to any person other than
the
[buyer]’. A rule
nisi
was issued at the same time, calling
on the seller to show cause why the interim interdict should not be
made final, pending finalisation
of the present application. The
rule
nisi
was duly confirmed on the return day. Even if it
were to be held, therefore, that it was necessary for the buyer to
have attached
the seller’s property in order to confirm this
court’s juris­diction, I am satisfied that an attachment of
the immovable
property would not have made any eventual judgment of
this court in favour of the buyer any more effective. To non-suit
the applicant
in these circum­stances merely because he may have
attached the wrong ‘label’ to his application by calling it an
interim
interdict instead of an attachment
ad confirmandam
juris­dictionem
, would be to sacrifice substance on the
altar of form. In the circumstances, I am satisfied that the
objection as to jurisdiction
cannot succeed.
Lapse
of offer
I
now turn to deal with the main defence relied
on
by
the seller, namely that she had ‘accepted’ the offer
some four days after it had lapsed, with the consequence that her
purported
‘acceptance’ was a nullity. The argument
on
behalf of
the seller is based on the proposition that ‘an
offer lapses if it is not accepted within the prescribed time’.
12
In
my respectful opinion, however, this proposition is stated too
widely and is potentially misleading. It correctly summarises
the
position where the offeror elects to
reject
the late
‘acceptance’ of an offer. The cases relied on by Kerr as well as
by De Wet & Van Wyk for the above proposition
all fall into this
category.
13
Clearly, the late acceptance of an offer cannot bind the offeror: it
is a trite principle of our law that, in order to bind the
offeror,
an acceptance must be made before the expiry of the offer.
14
The present case, however, is different: here, the offeror has
elected to
accept
the late ‘accep­tance’ and seeks to
bind the offeree. The issue for deter­mination is thus whether
the offeree can
avoid the agree­ment by relying on her own late
‘acceptance’ of the offer.
I
have not been referred to any reported decision dealing directly
with the point in issue, neither have I been able to find any
relevant decided case. Several academic authors have, however,
commented on the question. In his inaugural lecture as Professor
of
Law at the University of Witwatersrand (delivered on 30 May 1955),
Prof Ellison Kahn described the matter as ‘
res integra
in
South African law’.
15
Notwithstanding the lapse of more than half a century since that
time, this still appears to be the position.
In
his lecture,
16
Kahn discussed the position where the offeror has stipulated a
specific form of acceptance (eg by letter), which the offeree does
not comply with (eg by purporting to accept by telegram).
Notwithstanding the irregular acceptance, the offeror is satisfied
with
the form of acceptance adop­ted by the offeree. In some
countries (eg USA and Italy), the ‘irregular’ accep­tance is
regarded as a counter-offer which requires acceptance by the
offeror. Kahn suggests, however, that ‘the true rule is a simple
one, namely that it does not lie in the mouth of the original
offeree later to say that his purported acceptance was not an
acceptance
at all’.
17
Dealing
with the question whether the late acceptance of an offer should be
treated in the same way, Kahn points out that, in German
and Dutch
law, late acceptance is considered to be a counter-offer, whereas
the Italian Civil Code states that the offeror can
consider a late
acceptance as valid ‘provided he immediately gives notice to the
other party’.
18
Kahn suggests – ‘though without a great deal of confidence’
19
– that it is open to the offeror to claim that the late acceptance
is effectual, but not to the offeree.
Christie
20
relies on the above-mentioned views as authority for the following
statement:
‘
It
is clear, therefore, that if the offeree purports to accept the
offer after the fixed time has expired, the offeror is not bound
to
the contract. It seems equally clear that the proper way to
interpret the late “acceptance” is as a counter-offer which
the
original offeror can accept or reject as he wishes. On this view the
counter-offeror whose counter-offer has been accepted
would not be
entitled to change his mind and argue that his acceptance of the
original offer was out of time’.
In
contrast with Kahn’s diffidence on the question, however, Christie
submits quite categorically that ‘there can be no room for
doubt’
as to the correctness of the view that it is open to the offeror to
claim that the late acceptance is effectual, but not
to the offeree.
21
In
their ‘Source Book’ on contract and mercantile law,
22
Kahn
et al
also discuss the issue of late acceptance of an
offer, stating the following:
‘
Certainly
the offeror may treat the purported acceptance as ineffectual. But
say he wishes to treat is as effectual. Possibly he
may. In which
event the court may treat it as a counter-offer.’
The
learned authors point out that this appears to be the position in
German, French, Dutch and possibly United States law. They submit,
however, that this construction is ‘artificial’ and that
‘additional or other rules’ have been adopted in various other
legal
systems to regulate the position. The conclusion reached by
them is that the offeree who purports to accept after expiry of an
offer
‘will not be heard to say that he did not accept timeously.
It is for the offeror to raise the point, for he is not estopped from
so doing. But say he wishes to treat an acceptance objectively out of
time as effectual. It appears that the election lies with him.’
In
his replying affidavit, the buyer relied (at least partially) on the
construction of a counter-offer constituted by the seller’s
late
acceptance of his offer. Counsel for the buyer contended, however,
that this construction presented a problem for his client
inasmuch
as acceptance of the counter-offer had to be in writing. Tacit
acceptance, which would normally be inferred in circumstances
like
this, would thus not suffice. This is so, according to the argument,
by virtue of
s 2(1)
of the
Alienation of Land Act 68 of 1981
,
which requires any alienation of land to be contained in a ‘deed
of alienation signed by the parties thereto or by their agents
acting on their written authority’.
Counsel
sought to overcome the perceived problem by finding proof of such
written acceptance, first, in the signature by the buyer
of the
transfer documents and, secondly, in the signature of his founding
affidavit in this application. Both these documents,
which came into
being after the seller’s signature of the offer to purchase and
before the ‘counter-offer’ had expired or
had been withdrawn,
clearly and unequivocally reflect the buyer’s intention to be
bound by the agreement, so the argument went.
In
my view, however, the argument cannot avail the buyer, as he only
became aware of the alleged counter-offer when the seller raised
this point in her answering affidavit in these proceedings – long
after signature by him of the transfer documents and the founding
affidavit. As correctly submitted
on behalf of
the seller, the buyer could not validly have accepted a
counter-offer of which he was unaware at the relevant time.
23
This
argument
on behalf of
the buyer
illustrates, in my view, the artificiality of a construction based
on an alleged counter-offer, as pointed out by Kahn
et al
in
the passages referred to above.
An
alternative basis for liability relied on by the buyer in his
replying affidavit, was the allegation that he had not authorised
the seller’s agent ‘to limit the validity of [his] offer to
purchase by completing paragraph 10 thereof on [his] behalf’.
It
follows, according to the buyer, that the agent ‘had no authority
to amend or qualify [his] offer in the manner that she did
before
submitting it to the [seller] for acceptance, ie by inserting the
date of 8 November 2003 into clause 10 thereof’. The
buyer
accordingly submitted that this latter date should be regarded as
pro non scripto
.
24
The
problem with this line of argument
on behalf of
the buyer is that it appears to be at odds with his own
evidence. In his covering letter to the agent, accompanying his
signed offer
to purchase, he
inter alia
said the following:
‘
...Please
note that we need to know within the next few days of the seller’s
acceptance, as we have an option on another property
that requires
our urgent answer to those sellers.
...Please
ensure that you look after our interest when filling in the seller’s
information and or special requirements with regards
to the time
frames and or special conditions etc.
...Awaiting
your urgent and speedy reply.’
It
is abundantly clear from the foregoing that the buyer
did
in
fact mandate the agent to fill in an expiry date, having regard to
his situation and, in this way, to ‘look after (his) interest’.
In these circumstances, I am not persuaded that the buyer can
legitimately rely on the agent’s alleged lack of authority.
To
my mind, a far more satisfactory approach to the problem would be –
as suggested by the authors referred to above – to regard
the
expiry date inserted into the agreement as a stipulation for the
exclusive benefit of the offeror, which benefit he can elect
to
waive – in the same way that he can waive the benefit of the
traditional ‘bond clause’.
25
On this basis, it should be held that the offeror – but not the
offeree – has an election to accept or reject an irregular
‘acceptance’ of his offer.
26
Obviously such election will have to be exercised and communicated
to the offeree within a reasonable time, depending on the
circumstances.
27
This
is exactly the line originally adopted by the buyer in his founding
affidavit, where he said the following:
‘
I
…assume that
[the seller]
signed it on 8 November 2003 at the latest. In any event,
or in the alternative, I am advised that the clause is there for the
buyer’s
protection and that should an offer be accepted after that
date, then it is the buyer’s choice whether or not to still
proceed
with the agree­ment. I have opted to proceed.’
This
attitude on the part of the buyer finds support in the provisions of
clause 10 of the agree­ment, in terms whereof the
buyer waived
the right to be informed of acceptance of his offer. This appears to
indicate that the expiry date stipulated in clause
10 was not
regarded by the buyer as being material, as long as acceptance took
place ‘within the next few days’, as he put
it. On the evidence,
it is clear that this is what happened and, when the buyer was
informed shortly after 12 November 2003 of
the acceptance of his
offer, he did not bother for one moment to enquire as to exactly
when
the offer had been accepted, but instead elected
imme­diately to proceed with the transaction, regardless of the
time of acceptance.
In
the circumstances, I am satisfied that the buyer’s election to
treat the acceptance of the offer as effectual is legally sound
and
binding on the seller. I accordingly reject the seller’s
contentions to the contrary.
Failure
to obtain bond approval
As
a final alternative defence, the seller relied on the alleged
non-fulfilment of the suspensive condition pro­viding for the
approval of a bond for the full purchase price from a bank, building
society or financial institution. This point can be disposed
of
briefly.
Clause
7.1 of the agreement contains the usual ‘bond clause’, making
provision for the agreement to be ‘subject to the suspensive
condition that the purchaser obtains approval to the granting of a
loan against security of the property for an amount of not less
than
R485 000 from a bank, building society or financial institution
within 21 days of acceptance of this offer’. If the
loan was not
approved within the stipulated period, ‘the period of approval
shall automatically be extended for a period of 14
(fourteen) days’
(in terms of clause 7.3).
It
is common cause that the buyer’s bank only approved finance in
respect of 75% of the purchase price and not the full purchase
price, as provided for in clause 7.1. It is settled law, however,
that a bond clause like the one in question is for the exclusive
benefit of the purchaser and is capable of unilateral waiver by him,
provided that such waiver takes place before the date for
fulfilment
of the condition.
28
On
a proper construction of the agreement in this case, the due date
for fulfil­ment of the relevant suspensive condition was
35 days
after the con­clusion of the agreement; in other words, it was
open to the buyer to waive the benefit of clause 7.1
at any time up
to 17 December 2003.
The
conduct of the buyer after being informed of his bank’s decision
leaves no doubt that he did indeed unequivocally and timeously
waive
the benefit of the suspensive condition. The decision of the bank as
well as his election to proceed with the transaction
was
communicated by the buyer to the conveyancer on 27 November
2003.This decision was subsequently re­affirmed on numerous
occasions by the buyer’s conduct,
inter alia
by payment to
the conveyancer on 4 December 2003 of the transfer costs in an
amount of R34 335,65, as well as signature of
the transfer
docu­ments on 12 December 2003.
Against
this background, the seller argued, albeit somewhat tenta­tively,
that any alleged waiver by the buyer had not been
communicated to
her. This argument is without substance, as it loses sight of the
fact that the conveyan­cer appointed to attend
to transfer of
the property was in fact the seller’s agent. The conveyancer –
and hence the seller – was at all relevant
times kept fully
informed by the buyer of his election to waive the benefit of the
suspensive condition.
Conclusion
For
the reasons stated above, I am satisfied that the agreement between
the parties is valid and enforceable. No other grounds having
been
advanced to deny the buyer’s claim for specific performance of the
agreement, the buyer is entitled to an order as claimed.
Costs
Three
aspects relating to costs require brief mention. First, I was urged
on behalf of
the buyer to order the seller
to pay costs on the attorney and client scale. In my considered
opinion, there are not sufficient
grounds on the facts of this case
to justify a punitive costs order against the unsuccessful seller.
Secondly,
this application was previously enrolled for hearing on 16 May 2006.
The matter could not be heard on that day, so I am
informed, as the
court file was not in order. The case was accordingly postponed,
with the wasted costs being ordered to stand
over for later
determination. In terms of Uniform
Rule 62(4)
, it was incum­bent
on the buyer, as applicant, to ensure that the court file was in
order in all respects not later than five
days prior to the hearing.
In the circumstances, it appears to me that the postponement of the
matter on the previous occasion
was necessitated by the buyer’s
failure to comply with his duties. In these circumstances, it would
be fair to order the buyer
to pay the wasted costs occasioned by the
postponement.
Thirdly,
the buyer has asked for an order that the transferring attorneys be
authorised to retain an amount of R50 000 in trust
from the
proceeds of the sale of the property against which he (the buyer)
may set off his taxed costs herein. In the light of
the fact that
the seller is a
peregrinus
of the Republic and that it is
unknown whether she has any other assets in this country from which
the costs order could be satisfied,
I am prepared to accede to this
request, bearing in mind the doctrine of effectiveness referred to
above.
29
In
the circumstances, the following order is issued:
1. The
respondent is ordered to sign all documents and take all steps
necessary to effect the registration of transfer of the property
known as Erf 3649 Sedgefield, Western Cape into the name of the
applicant against payment by the applicant of the purchase price
and
transfer costs.
2. Failing
compliance by the respondent with the foregoing obligations within 10
(ten) days from the date of this order, the Sheriff
of this court is
authorised and directed to take such steps in her stead.
3. The
respondent is ordered to pay the costs of this application, provided
that the wasted costs occasioned by the postponement of
the
application on 16 May 2006 shall be paid by the applicant.
4. The
transferring attorneys are authorised to retain an amount of R50 000
in trust from the proceeds of the sale of the property
against which
the applicant may set off his taxed costs.
B
M Griesel
Judge
1
1958
(1) SA 555
(A) at 563C.
2
See
also
Thermo
Radiant Oven Sales (Pty) Ltd v Nelspruit Bakeries (Pty) Ltd
1969 (2) SA 295
(A) at 307A;
Veneta
Mineraria Spa v Carolina Collieries (Pty) Ltd (in liquidation)
1987 (4) SA 883
(A) at 888E–F.
3
Cf
Sonia (Pty) Ltd v
Wheeler supra
at 563F–564C;
Thermo
Radiant Oven Sales (Pty) Ltd v Nelspruit Bakeries (Pty) Ltd supra
at 306F–H.
4
Supra
at
300C–D and 311D–E.
5
[1990] ZASCA 115
;
1991
(1) SA 252
(A) at 258D–F and 260E–F.
6
(1848)
3 M 565. See also Herbstein & Van Winsen
The
Civil Practice of the Supreme Court of SA
(4ed
1997) at 70–1;
Pollak
on Jurisdiction
(2ed 1993 by Pistorius) at 90–1.
7
1953
(3) SA 31
(T) at 34G.
8
At
34H.
9
Supra
at
562A.
10
Harms
Civil Procedure in the Supreme Court
(1990, with loose-leaf updates, service issue 19) at D11.
11
The
order was issued by me on 16 November 2004 under case no 9707/04.
12
Kerr
The
Principles of the Law of Contract
(6ed 2002) at 74 and authorities referred to therein. To the same
effect is De Wet & Van Wyk
Kontraktereg
& Handelsreg
(5ed 1992) at 34 (with reference to options); Joubert
General
Principles of the Law of Contract
(1987) at 43; and Van der Merwe
et
al Contract – General Principles
(2ed 2003) at 54.
13
Viz
Laws
v Rutherfurd
1924 AD 261
at 262;
Bezuidenhout
v Ferreira
1967 (4) SA 417
(A);
Mutter­meier
v Skema Engineering (Pty) Limited
1984 (1) SA 121 (A).
14
Cf
Dietrichsen v
Dietrichsen
1911
TPD 486
at 496.
15
‘
Some
mysteries of offer and acceptance’
(1955) 72
SALJ
247
at 268.
16
Loc
cit.
17
Id.
18
Id.
19
Op cit
at 269.
20
Law
of Contract in SA
(5ed 2006) at 48 (footnotes omitted).
21
Loc
cit
footnote 143. See also Joubert
loc
cit.
22
Ellison
Kahn, Carole Lewis & Coenraad Visser
Contract
& Mercantile Law – A Source Book
(2ed
1988) Vol 1 at 158–9.
23
Cf
Bloom
v The American Swiss Watch Company
1915 AD 100
at 105.
24
Compare
in this regard
Ariefdien
v Soeker
1982
(2) SA 570
(C) at 577D–G.
25
As
to which, see the discussion in the following section of this
judgment (para below).
26
Compare
Ariefdien v
Soeker supra
at
576H.
27
Joubert
(n
supra
)
loc cit.
28
Van
Jaarsveld v Coetzee
1973 (3) SA 241
(A) at 244G;
Phillips
v Townsend
1983
(3) SA 403
(C) at 409A–E;
Trans-Natal
Steenkoolkorporasie Bpk v Lombaard & ’n Ander
1988
(3) SA 625
(A) at 640B–C;
Westmore
v Crestanello & Others
1995 (2) SA 733
(W) at 735H–737J.
29
See
paras Dealing with the last aspect first, the procedure of an attachment to confirm jurisdiction has its origin in the doctrine
of effectiveness, which is described in Sonia (Pty) Ltd v Wheeler1 as ‘the basic principle of jurisdiction’.2 In other words,
it is necessary in appropriate cases to attach property to confirm jurisdiction in order to render effective any judgment or order
that the court may eventually make. It follows that, if the court can give an effective judgment without an attachment having taken
place, such attachment would be unnecessary.3
and above.