SAFLII Note: Certain personal/private details of parties or witnesses have been redacted from this document in
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THE SUPREME COURT OF APPEAL OF SOUTH AFRICA
JUDGMENT
Not Reportable
Case no: 1038 /2023
In the matter between:
THE RO CK FOUNDATION PROPERTIES FIRST APPLICANT
ESTHER NYARWI NDEGWA SECOND APP LICANT
and
DOSVELT PROPERTIES (PTY) LTD FIRST RESPONDENT
ELI NATHAN CHAITOWITZ SECOND RESPONDENT
Neutral citation: The Rock Foundation Properties & Another v Chaitowitz
(1038 /2023 ) ZASCA 82 (9 June 2025 )
Coram: MOCUMIE, KEIGHTLEY and UNTERHALTER JJA
Heard : 7 May 2025
Delivered : This judgment was handed down electronically by circulation to the
parties’ representatives by email, publication on the Supreme Court of Appeal
website, and released to SAFLII. The date and time for hand down is deemed to be
9 June 2025 at 11h00 .
Summary: Section 17(2) (f) of the Superior Courts Act 10 of 2013 – reconsideration
of refusal of petition by Supreme Court of Appeal – whether exceptional
2
circumstances established – alleged simulated transaction – no exceptional
circumstances justifying reconsideration of rejection by high court and Supreme
Court o f Appeal that agreements were simulated .
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ORDER
On appeal from: Gauteng Division of the High Court, Johannesburg (Opperman J
sitting as court of first instance ):
1 The matter is struck from the roll.
2 The applicants are directed to pay, jointly and severally, the one paying the
other to be absolved, the costs incurred by the respondent in opposing the application
for reconsideration.
JUDGMENT
Keightley JA ( Mocumie and Unterhalter JJA concurring):
Introduction
[1] This is an applica tion for the reconsideration of a refusal , by two judges of
this Court, to grant leave to appeal , on petition , against a judgment of the Gauteng
Division of the High Court, Johannesburg (the high court) . The application comes
before this Court by way of a referral by the President of the Supreme Court of
Appeal under s 17(2)( f) of the Superior Court s Act 10 of 2013 (the SC Act) .
[2] The second applicant, Esther Nyarwai Ndegwa (Ms Ndegwa) is the sole
member of the first applicant, The Rock Foundation Properties ( the Rock
Found ation) . The subject matter of the application is a suite of agreements entered
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into by Ms Ndegwa, through the Rock Foundation, with the first respondent, Dosvelt
Properties (Pty) Ltd (Dosvelt). The second respondent, Eli Nathan Chaitowitz (Mr
Chaitowitz) , is the sole director of Dosvelt. The agreements concerned an
immovable property , Erf 2[...] S[...] Extension 24 Township (the property) , which
was previously owned by Ms Ndegwa.
[3] When Ms Ndegwa purchased the property, it was in a derelict state. She
effected some improvements with the assistance of a home loan of R1,2 million from
Absa Bank (the bank) . Ms Ndegwa believed that the property also had development
potential in that it was situated in an affluent area . She considered that with the
requisite planning and subdivision approvals, she could develop a small , gated
cluster complex on the property and maximise its value.
[4] In 2007 , Ms Ndegwa fell into arrears with her bond repayments . Judgment
was entered against her , and she faced the prospect that the property would be sold
in execution . Her application for subdivision, which was necessary for the envisaged
development , had stalled due to her lack of finances. Ms Ndegwa cast around for
potential investors to realise her development plans for the property and to stave off
a threatened sale in execution by the bank . As a judgment debtor, Ms Ndegwa could
not approach a financial institution for investment finance. It was against this
background that Ms Ndegwa met Mr Chaitowitz and concluded the suite of
agreements . The agreements were concluded simultaneously on 28 June 2018.
[5] The first agreement in the suite was a deed of sale (the sale agreement)
between Ms Ndegwa and Dosvelt, in terms of which she sold the property to Dosvelt
for a purchase price of R3 million. The sale agreement recorded that Ms Ndegwa
would be entitled to r emain in occupation of the property in terms of a lease
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agreement to be entered into between the parties. The latter agreement (the lease
agreement) was between Dosvelt, being the intended new owner, and lessor, of the
property, and the Rock Foundation, as lessee.
[6] The lease agreement was to take effect on the date of transf er of the property
to Dosvelt. It gave the Rock Foundation the right, at the latter’s own expense, to
procure the subdivision of the property; to demolish existing buildings; to erect new
residential buildings on the property in terms of an approved site development plan;
and to market for sale any residential units so erected. It was expressly recorded that
the purpo se of these provisions was to enable the Rock Foundation to secure
sufficient funds, through the sale of residential dwelling units, to enable it to exercise
the separate option agreement between the parties.
[7] The final agreement in the suite was the option agreement referred to in the
lease agreement (the option). It gave the Rock Foundation an option , exercisable
within three years of date of transfer of the property to Dosvelt, to purchase the
property (or whatever portions of which it may have been comprised following
subdivision) from Dosvelt on the terms agreed in Annexure A thereto . The agreed
purchase price for the exercise of the option was R 3,3 million . The lease agreement
and the option were further linked in that it was expressly recorded that the option
would be cancelled in the event of the cancellation o f the lease agreement.
[8] Transfer of the property to Dosvelt was duly registered on 30 October 2018
and the lease agreement took effect. It is common cause that the Rock Foundation
defaulted on its rental payments. The parties entered into an addendum to the lease
agreement on 24 May 2019, which granted certain indulgences to the Rock
Foundation , including a payment holiday and a payment plan. Despite this , the Rock
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Foundation fell into arre ars once more, triggering a letter of cancellation from
Dosvelt in respect of both the lease agreement and the option on 23 December 202 0.
[9] The response to this development by Ms Ndegwa and the Rock Foundation
was to institute an application in the high court seeking, as their primary relief, a
declaration that the agreements were unlawful credit agreements under s 8(4)( f),
alternatively s 40 of the National Credit Act 34 of 2005 (the NCA) and were void ab
initio . They sought a further order directing that the property be transferred back to
Ms Ndegwa at Dosvelt’s cost without, incidentally, any concomitant tender by Ms
Ndegwa to repay to Dosvelt the purchase price she had received .
[10] Dosvelt and Mr Chaitowitz were both cited as respondents in the high court
application. They opposed the relief sought and instituted a counterapplication for
an order declaring that the lease agreement was in force on 23 December 2020 ; that
it had been validly cancelled on that date ; and that the Rock Foundation be ordered
to vacate the property . In addition, they sought a n order confirming that the option,
having not been exercised by 23 December 2020, had lapsed.
[11] The essence of the applicants’ case in the high court, was that the suite of
agreements con stitute d a simulated transaction: while they may have appear ed to be
a sale agreement, with a linked lease and option, the real intention of the parties was
to effect a loan to Ms Ndegwa, with Ms Ndegwa’s property as security . According
to the applicants, this loan b ore all the hallmarks of a credit agreement under the
NCA and, because neither Dosvelt nor Mr Chaitowitz was a registered credit
provider, the agreement fell to be declared void ab initio .
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[12] The high court dismissed the applicant’s application and granted the relief
sought by the respondents in their counterapplication. It refused the application for
leave to appeal . This Court simil arly refused an application for leave on petition
under s 17(2)( b) of the SC Act (the petition refusal) on the grounds that there was
no reasonable prospect of success in an appeal and no other compelling reason why
an appeal should be heard . This triggered the applicants ’ reconsideration application
to the President of this Court under s 17(2)( f) of the SC Act in October 2018 (the
reconsideration application) .
[13] At th e time of the reconsideration application, and the President’s
determination thereof , s 17(2)( f) read , in relevant part :
‘The decision of the majority of the judg es considering an application referred to in paragraph ( b)
… to … refuse the application shall be final: Provided that the President of the Supreme Court of
Appeal may in exceptional circumstances , whether of his or her own accord or on application filed
within one month of the decision, refer the decision to the court for reconsideration and, if
necessary, variation.’1 (Emphasis added .)
[14] On 5 January 2024, t he President referred the petition refusal to the Court for
reconsideration under s 17(2)( f). The binding jurisprudence of this Court establishes
that it is for the Court to which the President’s referral is made to decide , as a
jurisdictional requirement , whether exceptional circumstances exist .2
1 Section 17(2) (f) was amended with effect from 3 April 2024 by the deletion of the phrase ‘in exceptional
circumstances’ and the substitution there for with the phrase ‘ in circumstanc es where a grave failure of justice would
otherwise result or the administration of justice may be brought into disrepute ’.
2 Motsoeneng v South African Broadcasting Corporation Soc Ltd and Others [2024] ZASCA 80, confirmed in
Bidvest Protea Coin Security (Pty) Ltd v Mandla Wellem Mabena [2025 ] ZASCA 23. Compare the dissenting
judgment of Coppin JA in Lorenzi v The State (1171/2023) [2025] ZASCA 58 (13 May 2025) paras 25 to 33.
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[15] In their application to the President, the applicants relied almost entirely on
the far -reaching contention that exceptional circumstances exist because the alleged
simulated transaction in this case was akin to the ‘ Brusson -type’ schemes that have
been set aside by, among other courts, the Constitutional Court . Those schemes
involve a fraud perpetrated on financially distressed property owners who, believing
that they are agreeing to offer their propert y as security for a loan, are duped into
passing transfer of the property to a third party who is in on the scam.3
[16] Wisely, counsel for the applicants disavowed reliance on the Brusson -type
argument at the hearing of the application. It was an argument that was correctly
rejected by the high court. Ms Ndegwa did not claim to have been defrauded in her
dealings with Mr Chaitowitz and Dosvelt , or to have been misled as to the nature
and effect of the agreements. Instead, her case was that the parties agreed that w hat
was presented to the world as a sale agreement was intended by them to be a secured
loan. This raises different considerations to those that prevail in true Brusson -type
cases.
[17] The question is whether there are any other considerations that establish the
existence of exceptional circumstances in this case. Ms Ndegwa must show more
than that she would have prospects of success were she be permitted to proceed to
an appeal. It will not assist her to rely on a mere repetition of arguments that have
been rejected by the high court and by two judges of this Court on petition. Section
17(2)( f) is intended to be restricted to matters that are truly exceptional , involving
3 See, for example, Absa Bank Limited v Moore and Another [2016] ZACC 34 ; 2017 (1) SA 255 (CC); 2017 (2)
BCLR 131 (CC) .
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substantive points of law, an issue of great public importance, or a strongly arguable
prospect of a denial of grave justice should reconsideration be refused .4
[18] The cornerstone of the applicants’ case is that exceptional circumstances exist
in that , unless they are given the opportunity to pursue an appeal , a grave injustice
will befall the public in general . This is so , they argue, because the suite of
agreements was, by common intent , really a loan by Mr Chaitowitz to Ms Ndegwa,
masquerading as an interlinked sale, lease and option . The loan agreement fell foul
of the NCA . The applicants say that if permitted to stand, the high court judgment
will strike a blow to the heart of what the NCA intends to achieve, namely, to protect
debtors like Ms Ndegwa.
[19] A c loser examination reveals insurmountable difficulties with these
contentions. The fundamental difficulty is that the applicants’ case stands or falls on
their succe ss in proving that the suite of agreements constituted simulated
transaction s: that the parties’ common intent was that the agreements were not what
they purported to be . The quandary for the applicants is that this involves a factual
inquiry , coupled with an interpretation of the agreements . This Court in Uys NNO
and others v The National Credit Regulator (Uys)5 stated with reference to
Zanderberg v Van Zyl ,6 that ‘ [t]he inquiry, therefore, is in each case one of fact, for
the right solution of which no general rule can be laid down.’
[20] In this case , the applicants raised n o substantive issue of law . In fact, it was
conceded by the applicants that they have no quarrel with the well -established
4 Avnit v First Rand Bank Ltd (20233/14) [2014] ZASCA 132 (23 September 201 4) paras 6 -7.
5 Uys NNO and others v The National Credit Regulator [2025] ZASCA 34 (1 April 2025).
6 Zandberg v Van Zyl 1910 AD 302.
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principles governing simulated transactions in our law as restated most recently by
this Court in Uys. They raised no new arguments on the facts and no new insights
on the interpretational question. Their submissions were no more than a rehearsal of
those that had been dismissed by the high court and by two judges of this Court on
petition.
[20] It follows that there are no exceptional circumstances to justify a re -
examination of the high court’s rejection of the applicants’ simulated transaction
argument. Once this is so, the central tenet of the ir case fails .
[21] For completeness ’ sake, I should add that there are neither prospects of
success , nor the risk of grave injustice for the applicants. Ms Ndegwa’s averments ,
that the parties’ common intention was to conclude a personal loan to her by way of
a simulated sale, lease and option arrangement , were emphatically disputed by Mr
Chaitowitz , with good reason. An interpretation of the agreements demonstrates no
more than an intent by the parties to agree to a common commercial arrangement :
Mr Chaitowitz purchased the property through Dosvelt , while at the same time, and
for a price, giving Ms Ndegwa the opportunity to proc eed with her intended
development and, if she had t he means within three years to do so – presumably if
her development plans reached fruition – to exercise an option , through the Rock
Foundation, to purchase it. There is nothing unusual or suspicious in that
arrangement.
[22] The applicants having failed to establish the requisite jurisdictional fact that
exceptional circumstances exist, a reconsideration of the petition decision is
impermissible. Consequently, the matter falls to be struck from the roll. There is no
reason why costs should not follow this result.
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[23] I make the following order :
1 The matter is struck from the roll.
2 The applicants are directed to pay, jointly and severally, the one paying the
other to be absolved, the costs incurred by the respondent in opposing the application
for reconsideration.
______________ _____________
R M K EIGHTLEY
JUDGE OF APPEAL
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Appearances
For the app licants : M Meyerowitz
Instructed by: Pandor Davids Attorneys Inc, Roodepoort
c/o Symington de Kok Attorneys , Bloemfontein
For the respondent: W Strobl
Instructed by: Clifford Levin Inc, Johannesburg
c/o McIntyre van der Post , Bloemfontein.