SAFLII Note: Certain personal/private details of parties or witnesses have been redacted from this document
in compliance with the law and SAFLII Policy
IN THE HIGH COURT OF SOUTH AFRICA
(EASTERN CAPE DIVISION, MTHATHA)
CASE NO.: 1167/2024
In the matter between:
MADODA PHUMELELE MADIKIZA Applicant
And
EASTERN CAPE DEVELIPMENT CORPORATION Respondent
JUDGMENT
ZONO AJ:
Introduction
[1] The applicant approached this court on urgent basis and an interim relief
was obtained by consent on the 14th March 2024 on the following terms:
“1. Any non-compliance with the rules relating to time frames, forms and services
provided for in the Uniform Rules of Court is condoned in terms of Rule 6(12).
2. A rule nisi is hereby issued calling upon the respondent to show cause, if any,
before this court on Tuesday 2 April 2024 at 09H30 , or so soon thereafter as
the matter may be heard, why the following order should not be made.
2.1 That the respondent is interdicted and restrained from selling
and/ or alienating and/ or disposing of Erf 2[...], situated at No
[...] W[...] Drive, Fortgale, Mthatha (the property) without
affording the applicant a right of first refusal to purchase the
property.
2.2 The respondent shall pay the costs of the application.
3. Paragraph 2.1 above shall operate as in interim interdict with immediate
effect pending the return day and the final determina tion as to whether the
applicant has a clear valid and enforceable right of first refusal to purchase
the property” (sic).
[2] The respondent, the Eastern Cape Development Corporation (ECDC)
opposed this matter and in so doing it filed not only a notice of
opposition, but also answering, and supplementary affidavit together with
annexures. The applicant duly replied to ECDC’s answering papers. On
the 12th of March 2025 this matter came to this court apparently as a fully
opposed matter and was postponed to the 19th of August 2025 for hearing
of oral evidence in terms of the court order dated 05 th of December 2024.
I was not fortunate to find the court order dated 05 th December 2024,
where issues referred for hearing of oral evidence were outlined. The
issues referred for hearing of oral evidence were not outlined in the court
order dated 12th March 2025.
[3] However, the parties in terms of their joint practice note dated 19 th
August 2025, delineated the issues for hearing of oral evidence. It appears
in paragraph 6 of the practice note that the contents of the court order
dated 05th December 2024 are recorded as follows:
“6.1 Whether in March 2021, there was a meeting between the applicant
and Mr Dlulane, the then CEO of the respondent; and
6.2 Whether i n this meeting Mr Dlulane gave the applicant the right of
first refusal to purchase Erf 2[...], No [...] W[...] Drive, Mthatha, and
6.3 Whether this agreement was reduced to writing” (sic).
[4] In paragraph 5 of their practice note it is recorded thus:
“5. The applicant in his replying affidavit dated 09 th July 2024, requested
that the matter be referred to oral evidence as there was a material
dispute of fact relating to:
5.1 Whether in March 2021, there was a meeting between the
applicant and Mr Dlulane, the CEO of the respondent and;
5.2 Whether in this meeting Mr Dlulane gave the applicant the
right of first refusal to purchase Erf 2[...], No [...] W[...] Drive,
Mthatha” (sic)
[5] The court order dated 05 th December 2024 and the practice note dated
19th August 2025 narrowed down issues for determination as are
delineated therein. However, both the court order and the practice note
flow from the pleadings. The relevant part of the founding affidavit is
paragraph 7-8 thereof which read thus:
“7. I was unable to raise the purchase price within 90 days. Around March
2022 I held a meeting with Mr Ndzondelelo Dlulane, who was at the
time the Chief Executive Officer of the respondent. The aim of this
meeting was to negotiate with the respondent to give me more time to
raise the purchase price. Mr Ndzondelelo Dlulane said he would not
give me more time. He instead stated that the respondent was giving
me a right of first refusal, in the event that the respondent d ecides to
sell the property in question. The terms of the right of refusal were the
same terms set out in paragraph 4.1 of the deed of settlement, namely
that the respondent would conclude a deed of sale with me in terms of
which the respondent would sell to me Erf 2[...], Umtata for purchase
price of R 1151 755.90 and afford me 90 days to raise and pay the
purchase price.
8. I left the meeting with a copy of the document containing the terms of
purchase price.
8. I left the meeting with a copy of the document containing the terms of
the right of refusal. Ndzondelelo Dlulane also kept a copy of this
agreement. The respondent’s therefore have a copy of the agreement.
Due to the extreme urgency in which this application has been brought
I am unable to attach this document as I am still looking for it. I
implore the respondent to make its copy avai lable for this court ”
(sic).
[6] In its answering affidavit ECDC denies that the applicant was given a
right of first refusal as alleged by the applicant. It contends that if such
right were to be given (which is denied) it would never be given on the
same terms and conditions as the settlement agreement, i.e that the
applicant would have a further 90 days to raise and pay the purchase price
for the property. Mr Dlulane is no longer employed by the ECDC and
there is no record whatsoever of any agreement b eing entered into with
ECDC as suggested by the applicant. The ECDC states that it is not aware
of the meeting the applicant had with Mr Dlulane. The ECDC denies that
there is any document containing the terms of the right of first refusal that
the applicant alleges. It concludes by saying, the fact that the applicant
cannot locate what is an extremely important document to him serves to
evidence that it does not in fact exist.
[7] The applicant undoubtedly relies on an alleged agreement entered into
between him and the ECDC. In motion proceedings affidavits constitute
both pleadings and evidence in support of the relief sought and/ or the
defence raised. In application proceedings the affidavits take the place not
only of the pleadings in an action, but also of the essential evidence
which would be led at a trial 1. Rule 18 of the Uniform Rules of Court
(URC) is applicable in this matter especially that it ended up in the trial
court. Rule 18(6) of URC provides that:
“(6) A party who in his or her pleading relies upon a contract shall state whether the
contract is written or oral and when, where and by whom it was concluded, and if the
1 Transnet Ltd v Rubenstein 2006 (1) SA 591 (SCA) at 600G. In M c Williams v First Consolidated Holdings
(Pty) Ltd 1982 SA 1 (A) at 10E it was held that: it is clear that affidavits really constitute both pleadings and
the evidence in support of the allegations made, and the rules as to pleadings should, to that extent , be applied
to affidavits. ------
contract is written a true copy thereof or of the part relied on in the pleading shall be
annexed to the pleading”.
The provisions of Rule 18(6) of URC are obligatory.
[8] The applicant bases his cause of action against the ECDC upon a written
agreement. The written agreement is a vital link in the chain of the
applicant’s cause of action against the ECDC. In order for the applicant’s
cause of action to be properly pleaded, it is necessary for the written
agreement relied upon to be annexed to the particulars of claim. An
allegation that a party is not in possession of the written agreement relied
upon, constitutes a n acknowledgement that the basis for the cause of
action advanced is lacking, or that a link in the chain of the cause of
action advanced is missing. It is therefore clear that a party who bases its
cause of action upon written agreement should obtain a tr ue copy of the
agreement before advancing its claim.
[9] However, there are exceptions. If the document is destroyed or lost, Rule
18(6) is not intended to compel compliance with impossibility. A
document need not be attached if it is impossible to do so . Such non -
compliance may be condoned in terms of Rule 27(3) of URC which
provides thus:
“(3) The court may, on good cause shown, condone any non -compliance with these
Rules”.
The subrule requires good cause to be shown 2. This approach applies to
all ap plications which may be brought under the subrule 3. A defaulter
should file an affidavit wherein he must furnish an explanation of his
2 Du Plooy v Anwes Motors (Edms) BPK 1983 (4) SA 212 (O) at 216H- 217D.
3 Superior Court Practice- D1-322 Service issue 17, 2021.
default sufficiently full to enable the court to understand how it really
came about, and to assess his conduct and motives4.
[10] An applicant should, whenever he realizes that he has not complied with
the Rule of court, apply for condonation without delay 5. To start with
there is no application before me that was made, either orally or in
writing. This behoves me to deal with what appears in paragraph 8 of the
founding affidavit contents of which are the following:
“8. I left the meeting with a copy of the document containing the terms of
the right of refusal. Mr Ndzondelelo Dlulane also kept a copy of t his
agreement. The respondents therefore have a copy of the agreement.
Due to the extreme urgency in which this application has been brought
I am unable to attach this document as I am still looking for it. I
implore the respondent to make its copy available for this court” (sic).
The affidavit was deposed to on the13th March 2025 with the proceedings
having been instituted on the same date. In paragraph 9 of the founding
affidavit the applicant appears to have been advised of the import of the
document, embodying his right of first refusal on the 12th March 2024.
[11] The respondent flatly denied in its answer the existence of the document
relied upon by the applicant in their answer. In reply the applicant
accepted that the respondent was unable to locate the document when the
respondent was also denying its existence . The applicant made the
following allegations in his reply:
“25. I maintain that there exists a document containing the terms of the right of first
refusal as alleged in the founding affidavit. The inability to locate the document does
not mean that it does not exists” (sic).
4 Sibber v Ozen Wholesalers (Pty) Ltd 1954 (2) SA 345 (A) at 353 (A).
5 Commissioner for Inland Revenue v Burger 1956 (4) SA 446 (A) at 449G-H.
The replying affidavit appears to have been served upon the respondent’s
attorneys on the 19 th July 2024; which period exceeds four months after
the filing of founding affidavit. I reiterate that the applicant promised in
the founding affidavit to look for document embodying his right of first
refusal. Four months later no application for condonation for the non -
filing of the document embodying applicant’s right of first refusal. On the
12th March 2025, more than a year or twelve mo nths later, this matter
came before court for its hearing as an opposed matter. The applicant still
did not apply for condonation of non -filing of the document embodying
his right of first refusal, instead the applicant declared a dispute of fact on
the very issue of the existence of a right of first refusal, hence the referral
for hearing of oral evidence.
[12] If I may revert to the replying affidavit the applicant alleges as follows:
“45. I am not able to find a copy of the written right of refusal eve n after a
diligent search. During April 2023 there was a burglary at my home
and most of my documents were stolen. The burglary was reported at
Central Police Station under case no: 123/04/2023. I reiterate that I
have a right of first refusal entered int o between myself and Mr
Ndzondelelo Dlulane, the later acting on behalf of the respondent.
A case about the burglary and lost document only surfaced in the reply
when no further pleading was expected from the respondent. It may be
mentioned that the list o f the items that were allegedly stolen during
burglary is not placed before this court for this court to have an idea that
applicant’s documentary material was reported to have been stolen during
the burglary that took place in applicant’s home during Apri l 2023.
However, during his oral testimony the applicant testified that in 2022
some of the documents were taken away by the people as some were
spewed all over his premises. This now presents a shift and variation
spewed all over his premises. This now presents a shift and variation
from the version in the replying affidavit. The explanation therefore is not
satisfactory and reasonable. It is now not clear if the burglary aforesaid
was in 2022 or 2023. That being said, no application for condonation has
been made. I express no view about the prospects of that application ha d
it been made.
[13] On the conspectus of the above, it is now plain that the applicant has
egregiously violated the provisions of Rule 18(6) of URC, thereby
rendering applicant’s cause of action incomplete, which cause of action is
not sustainable. A mat ter without a complete cause of action cannot be
sustained and that invariably leads to the dismissal thereof. This
application cannot succeed.
[14] Even if I am wrong in this regard, applicant’s case would still not
succeed on a different ground. I deal with the ground hereinafter.
[15] In paragraph 5 hereof I have quoted verbatim the contents of paragraph 7
and 8 of the founding affidavit. It will be apposite to read those
paragraphs together. In those paragraphs the applicant alleges that there
was a meeting which resulted in an agreement to grant applicant a right of
first refusal.
[16] It is important to understand and keep in mind the purpose of the alleged
meeting. The CEO, Mr Dlulane and the applicant set out to talk and
negotiate the extention of 90 days’ period, which period the applicant was
unable to meet to raise the purchase price agreed upon in the settlement
agreement. When the parties were inviting each other, they had only that
item on the agenda. When applicant’s request was turned d own by Mr
Dlulane, the CEO, an unexpected item 6 pitched up and formed an
unexpected agenda item. A number of difficulties arise from this as I will
demonstrate.
[17] Nowhere in the whole tenor of the founding affidavit does it appear that
Mr Dlulane, the CEO was authorised to enter into an agreement with the
applicant in relation to ECDC’s property. No authority or whatsoever is
pleaded by the applicant in his founding papers. In Mistry7 Diemont JA
makes this point aptly as follows:
“When, as in this case, the proceedings are launched by way of notice of motion, it is to the
founding affidavit which a judge will look to determine what the complaint is. As was pointed
out by Krause J in Pountas’ Trustee v Lahanas 1924 WLD 67 at 68 and has been said in many
other cases…. An applicant must stand or fall by his petition and the facts alleged therein and
that, although sometimes it is permissible to supplement the allegations contained in the
petition, still the main foundation of the application is the allegation of facts stated therein,
because those are the facts which the respondent is called upon either to affirm or deny.”
The purpose of pleadings is to bring to the notice of the court and the
parties the issues upon which reliance is to be placed for the rivalling
contentions. It has been repeatedly said that the object of the pleadings is
to define and ascertain definitely what the question at issue between the
parties is and this object can only be attained when each party states his
case with precision8.
[18] The applicant adduced his oral testimony on the 19 th August 2025. No
evidence or whatsoever was tender on the subject. During argument Mr
Msindo, applicant’s Counsel was requested to make submission on the
6 Especially on the part of the applicant.
7 Director of Hospital Services v Mistry 1979 (1) SA 626 (A) at 635-636A.
8 Imprefed ( Pty) Ltd v National Transport Commission 1993 (3) SA 19 (A) at 107 C -H; ABSA Ltd v
Blumberg and Wilkinson 1995 (4) SA 403 (WLD) at 409 C-F.
issue of the au thority of Mr Dlulane and he requested to be given an
opportunity to collect his thoughts and file his supplementary heads on
the subject. He indeed filed applicant’s supplementary heads of argument
prepared by Adv A. Msindo. He strongly based his argument and relied
on the authority of the Constitutional Court Judgment of Makate9
“65 ……… The concept of apparent authority as it appears from the
statement by Lord Denning, was introduced into law for purposes of
achieving justice in circumstances where a pr incipal had created an
impression that its agent has authority to act on its behalf. If this
appears to be the position to others and an agreement that accords
with that appearance is concluded with the agent, then justice demands
that the principal must be held liable in terms of the agreement.”
[19] The above Constitutional Court judgment is binding on me. The doctrine
of precedent, which requires court to follow the decision of coordinate
and higher court is an intrinsic feature of the rule of law, wh ich is in turn
foundational to our Constitution 10 . In True Motives11 Cameron JA had
this to say:
“100 …… Without precedent there would be no certainty, no predictability
and no coherence. The courts would operate in a tangle of unknowable
considerations, which all too soon would become vulnerable to whim
and fancy. Law would not rule. The operation of precedent, and its
proper implementation, are therefore vital constitutional questions.
101. However, it is well established that precedent is limited to the binding
basis (or ratio decidendi ) of previous decisions. The doctrine obliges
courts of equivalent status and those subordinate in the hierarchy to
follow only the binding basis of a previous decision. Anything in a
judgment that is subsidi ary is considered to be ‘said along the
wayside’, or ‘stated as part of the journey’ ( obiter dictum), and is not
binding on subsequent courts
binding on subsequent courts
9 Makate v Vodacom (Pty) Ltd [2016] ZACC 13 2016 (6) BCLR 709 (CC); 2016 (4) SA 121 (CC) Para 65.
10 Makhanya v University of Zululand 2010 (1) SA 62 (SCA); 2009 (8) BLLR 721 (SCA); 2009 (4) ALL SA
146 (SCA); 2009 30 ILJ 1539 (SCA) Para 6.
11 True Motives 84 (Pty) Ltd v Madhi and others 2009 (4) SA 153 (SCA); 2009 (7) BCLR 712 (SCA); 2009
(2) ALL SA 548 (SCA) Pra 100-101.
[20] However, the dictum in Makate does not apply to the facts of this case.
It is fundamental principle of our law that each case must be decided
according to its own merits. It is clear from the dictum that the principal,
ECDC in this case, must have created an impression that its agent, Mr
Dlulane in this case, has the authority to act on its behalf. If this
impression appears to be the position to others and an agreement that
accords with that appearance is concluded with the agent, then justice
demands that the principal must be held liable in terms of the agreement.
[21] There is nothing pleaded by the appli cant that would suggest that the
ECDC created an impression that Mr Dlulane has the authority to enter
into agreement to grant a right of first refusal to the applicant. During the
oral testimony, the applicant also did not adduce any evidence that would
demonstrate that ECDC created such an impression. The applicant, as the
onus bearing party, has failed dismally to stablish facts that would support
a conclusion that ECDC created an impression that Mr Dlulane was its
agent in so far as it relates to the gr anting of right of first refusal. He who
alleges must prove it.
[22] In line with Rule 18(4), which requires that “every pleading shall contain
clear and concise statement of the material facts upon which the pleader
relies for his or her claim, defence or answer to any pleading, as the case
may be, with sufficient particularity to enable the opposite party to reply
thereto”, Makate12Judgment supports the proposition that authority must
be pleaded. A party who wishes to rely on an Agency must allege and
12 Makate v Vodacom (Pty) Ltd (Supra) Para 45 and 59.
prove the existence and scope of the authority of the alleged agent
whether express or implied13.
[23] The basic rules governing the incidence of the onus of proof have been
set out in the case of Pillay14 The three rules are the following:
“(a) if one person claims something from another in court of law, then he
has to satisfy the court that he is entitled to it.
(b) Where the person against whom the claim is made is not content with a
mere denial of that claim, but sets up a special defence, then he is
regarded quo ad that defence, as being the claimant: for his defence to
be upheld he must satisfy the court that he is entitled to succeed on it.
And
(c) He who asserts, proves and not he who denies, since a denial of a fact
cannot naturally be proved provided that it is a fact that is denied and
that the denial is absolute.”
[24] Having stated above that the authority of Mr Dlulane was never pleaded
and equally no evidence was adduced or led on behalf of or at the
instance of the applicant to support or to establish that Mr Dlulane had
authority to represent and bind ECDC in the agreement; I therefore come
to a conclusion that applicant’s submissions in supplementary heads on
the issue of authority are an afterthought and a total thumbsuck.
[25] It is vital to note the following significant facts: The applicant could not
tell the exact date when the alleged right of refusal was granted, contrary
to what Rule 18(6) of URC requires. He was content with giving this
court only the estimates. It i s not expressly stated in the founding
affidavit, at whose instance was the meeting called or convened. The
13 Harms Amler’s Precedents of Pleadings, Seventh Edition, Page 23 and Case referred to therein.
14 Pillay v Krishna and Another 1946 AD 946 at 951-2.
place of the meeting was not pleaded, contrary to what Rule 18(6) of
URC requires. Much later in the oral evidence the applicant testified that
the meeting was held at ECDC Boardroom at his instance. Looking at the
purpose of the meeting, which was to negotiate the extention of the time
within which to raise the purchase price, it is accepted that the meeting
was called at the instance of the applican t. The manner in which that
meeting was arranged is not clear both in the oral testimony and in the
affidavits. That is important to give an idea as to the prior knowledge of
the parties of the subject of the discussion thereat. It is vital to give an
idea as to the possible arrangements and preparations that may have
ensued to make a counter -offer to applicant’s proposal. Time or date
when this meeting was agreed to. An impromptu meeting between the
two individuals would not have afforded Mr Dlulane enough opportunity
to secure and obtain the necessary authority and instructions from the
ECDC. That points only to one direction that the applicant has failed to
prove its case, especially that the ECDC disputes any knowledge of the
agreement that gave rise to the alleged right of first refusal. It is not clear
what could have veered the parties away from the original and basic
agenda before the parties, and decide to talk about a matter that did not
form part of the agenda. The meeting was about the extension o f time
within which to raise the purchase price, but the parties inexplicably
agreed on a different issue about a right of first refusal. All the questions
discussed in this paragraph and elsewhere in this judgment raise an issue
of lack of probabilities on the applicant’s case.
[26] To bury the point about the issue of Mr Dlulane’s authority, Ms Sephton,
Counsel for the ECDC referred to section 14 of Act 2 of 1997 15 which
provides thus16:
“14. Chief Executive Officer
(1) The board shall after consultation with the responsible member appoint a person as chief
executive officer of the corporation who shall exercise such powers and perform such duties
as may be authorised or prescribed by the board.”
[27] Both the ECDC 17 and the CEO 18 are creatures of statute. They have no
inherent powers and their powers must be deduced from four corners of
the statute. The powers the CEO would have had, would be the powers
given to it by the Board of Directors appointed in terms of Section 7(3) of
the Act. In terms of section 7(1) of the Act, the operations of the ECDC
are managed and controlled by a Board of Directors, which may exercise
all such powers of the corporation as are not required to be exercised by
the shareholders of the ECDC. The ope rations include general
functioning and working of ECDC excluding shareholder’s powers and
duties. Section 7(2) refers to the affairs of the operations of ECDC. It is
plain that the power to manage and control the affairs of the ECDC is
reposed to the Boar d of Directors. The South African Concise Oxford
Dictionary meaning of the word manage is “ 1 be in charge of; run; 2
Supervise.” The affairs of the ECDC are statutorily run and supervised by
the Board of Directors. It is the Board of Directors that is in c harge of
ECDC affairs. This put paid to Mr Msindo’s sigh of despair that the
15 Eastern Cape Development Corporation Act 2 of 1997
16 Section 49 of Articles of Eastern Cape Development Corporation
17 Section 2 of the Eastern Cape Development Corporation Act 2 of 1997
18 Section 14 (Supra)
CEO is an accounting officer imbued with all powers to decide the affairs
of the ECDC. There is no merit to such submission19.
[28] Section 10 of the Interpretation Act20 provides thus:
“…..
(2) Where a law confers a power, jurisdiction or right, or imposes a duty
on the holder of an office as such, then, unless the contrary intention
appears, the power, jurisdiction or right may be exercised and the duty
shall be performed from time to time by the holder for the time being of
the office or by the person lawfully acting in the capacity of such
holder”.
It therefore cannot be fathomed how a functionary can exercise a power
without such power having been conferred u pon him. The power to take
charge of the operations and the affairs of the ECDC is statutorily
conferred on the Board of Directors. There is no case made out for the
delegation of that power to the CEO. There is no case made out to
establish that the ECDC granted applicant a right of first refusal.
[29] The ECDC and the CEO comply with the definition of an organ of
state21. Section 239(b) of the Constitution defines the organ of state to
inter alia, mean:
“……..
(b) any other functionary or institution-
(i) exercising a power or performing a function in terms of the
Constitution or
(ii) exercising a public power or performing a public function in terms
of any a provincial constitution; or legislation.”
19 Section 4(1) (r) of the Act provide inter alia, that the ECDC has the power itself to appoint or
representatives in connection with any of its objects.
20 Interpretation Act 1No 33 of 1957
21 Section 239(b) of the Constitution.
ECDC exercises power in terms of the legi slation. That makes it an
organ of state. It therefore exercises public power.
[30] In Chirwa22 Ngcobo J remarked thus:
“138 …. In my view, what makes the power in question a public power is the
fact that it has been vested in a public functionary, who is required to
exercise the power in the public interest. When a public official
performs a function in relation to his or her du ties, the public official
exercises public power. I agree with Cameron JA that Transnet is a
creature of statute. It is a public entity created by the statute and it
operates under statutory authority. As a public authority, its decision
to dismiss nece ssarily involves the exercise of public power and,
“[t]hat power is always sourced in statutory provision, whether
general or specific, and, behind it, in the Constitution.” Indeed,
in Hoffmann v South African Airways, this Court held that “Transnet is
a s tatutory body, under the control of the State, which has public
powers and performs public functions in the public interest.”
[31] The object of ECDC 23 shall be to plan finance, co -ordinate, market,
promote and implement the development of the province and all its
people in the field of industry, commerce, agriculture, transport and
finance. For the attainment of its objects, ECDC shall have power to “
transfer” any kind of movable or immovable property held by the
corporation or any interest in such property 24. It is therefore plain from
these two provisions that the ECDC exercises its power in the public
interest.
[32] The Doctrine of legality which requires that power should have a source
in law is applicable whenever public power is exercised. Public power
22 Chirwa v Transnet Limited and Others 2008 (4) SA 37 (CC); 2008 (3) BCLR 251 (CC) Para 138.
23 Section 3 of Eastern Cape Developmnet Corporation Act 2 of 1997.
24 Section 4(1) (5) of the Act.
can be validly exercised only if it is clearly sourced in law 25. Khampepe J26
had this to say:
“[1] State functionaries, no matter how w ell-intentioned, may only do what
the law empowers them to do. That is the essence of the principle of
legality, the bedrock of our constitutional dispensation, and has long
been enshrined in our law”.
[33] It is inapposite to contend that Mr Dulane, as t he CEO, whose power in
terms of the statute depended on what the Board of Directors would have
given to him, would have had a power to enter into an agreement with a
view to dispose of an asset of the ECDC. He does not have that power in
terms of the law. His actions would have militated against the principle of
legality which requires that all the exercise of public power must have a
source in law. If Mr Dlulane did not have the power to enter into
agreement encroaching to the management and control of the affairs of
the ECDC 27, that exercise would have been unlawful and against the
doctrine of legality. Applicant’s case in this regard cannot succeed.
[34] Even if it can be said that there is a point in applicant’s submission about
authority, which is not the position, the applicant would still have a
mountain to climb. Applicant vacillates between the fact that Mr Dlulane
gave him a right of first refusal on the one hand, and the fact that there is
an agreement of first refusal entered into on the other. Either way, the
applicant seeks to enforce a contractual right as it is clearly argued in his
heads of argument.
25 AAA Investments (Pty) Ltd v Micro Finance Regulatory Council and another 2007 (1) SA 343 (CC) Para
68.
26 Head of Department, Department of Education, Free State Province v Welkom High School and another;
Head of Department, Department of Education Free State Province and Another r v harmony High School
and another 2013 (9) BCLR 989 (CC); 2014 (2) SA 228 (CC) Para 1.
27 Which power is reposed to the Board of Directors.
[35] What is stricking about applicant’s case is the fact that, regarding the
alleged giving of the right of first refusal, his affidavits and the oral
testimony are completely silent about his reaction to all of this. Firstly, it
is alleged that Mr Dlulane stated that he would not extend the time for the
applicant to raise the purchase price, and further stated that he was giving
him a right of first refusal in the event that ECDC decides to sell the
property in question. However, no response appears to have been made to
such an important statement. A proper response would have been to
accept or reject such an offer. There is, importantly, no re cord of him
accepting the offer, which reaction would have resulted in an agreement.
Secondly, a document was given to him. Again, no reactionary attitude is
exhibited both in the papers and oral evidence except to take the
document and subsequently lose it. It is not clear if the document required
both parties to sign. There is completely no record of the parties signing
the document, as it would necessarily be the case if a written agreement
was intended to be entered into. In a nutshell, how was the alle ged offer
accepted? There was no corresponding response to the alleged offer of the
right of first refusal. One aspect of the rule that acceptance must be clear
and unequivocal or unambiguous is that the acceptance must exactly
correspond with the offer 28. In the absence of clear and unambiguous
acceptance which corresponded with the offer, there is no agreement at
all. The right of pre -emption must comply with all the formalities and
requirements of the agreement if the land is the subject of right of pre -
emption29.
Conclusion
28 RH Christie: The Law of Contract in South Africa; 5th Edition, Page 62.
29 AJ Kerr: The Law of Sale and Lease, 3rd Edition, Page 463.
[36] The probable facts of this case militate against the version of the
applicant. An extract from the minutes of the meeting of the board of
directors of 25th February 2021 demonstrates clearly that a resolution was
taken by the board authorising the managem ent to proceed with the
property disposal as per the deed of settlement. Not only section 7 of the
Act demonstrates that the management and control of the assets of the
ECDC vests with the Board of Directors, also the practice as
demonstrated by the resolu tion shows that. The CEO can only be
authorised by the board to do anything. Only the implementation of the
deed of settlement dated 16th March 2010 was authorised.
[37] Sequel to that, on 31 st March 2021 the applicant was furnished with two
deeds of sale, one in respect of Erf 2675 and the other in respect of Erf
2[...], for signatures. The applicant only signed the one relating Erf
2[…]2 and left the one relating to Erf 2[...] not signed. Reminde rs were
made by ECDC to the applicant for him to append his signature, but to no
avail. A letter dated 21st August 2021 was penned as a reminder following
many reminders, but to no avail. On 30 th September 2021, the settlement
agreement dated 16 th March 2010, which required that a deed of sale in
respect of Erf 2[...], Umtata, between the applicant and the ECDC to be
concluded, was cancelled. Even if it can be said that there was a right of
first refusal in existence, it would have been discharged, extinguish ed or
satisfied by the effort the ECDC embarked on to afford the applicant an
opportunity to sign the deed of sale which substantially or exactly
complied with the settlement agreement dated 16 th March 2010. The
applicant was directly offered to purchase t he property on 31 st March
2021 but failed to take up that offer as he deliberately chose not to sign a
deed of sale relating to Erf 2[...], but preferred to sign one in respect of
Erf 2[…]2. No explanation for such choice has been made to this court,
either i n the papers or during oral evidence. This application clearly
cannot succeed. As it fails it must do so with costs.
Order
[38] In the result I would make the following order:
1. The rule nisi granted on 14th March 2024 is hereby discharged.
2. The application is hereby dismissed with costs.
________________________________
A.S ZONO
JUDGE OF THE HIGH COURT (ACTING)
APPEARANCES:
For the Applicant : MR MSINDO
Instructed by :V .V MSINDO & ASSOCIATES
48 Wesley Street
Mthatha
Tel: 047 532 2231
Email: vvmsindo@vodamail.co.za
Ref: Mr Msindo
For the Respondent : ADV S.S SEPHTON
Instructed by :BAX KAPLAN RUSSEL INC
34 Pearce Street
Berea
East London
Tel: 043 706 8400
Email: jason@bkr-inc.co.za
Ref:Mr J de Klerk/sd/MAT65432
c/o POTELW A ATTORNEYS
43 Wesley Street
Mthatha
Tel:047 531 0237
Ref: Mr Potelwa
Matter heard on :19 August 2025
Delivered on : 11 September 2025