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(The matter was heard in open court and judgment was reserved. The judgment
was uploaded onto the electronic file of the matter on CaseLines and the date of
uploading the judgment onto the electronic file of the matter and Caselines is
deemed to be the date of the judgment).
BEFORE: HOLLAND-MUTER J:
[1] The dispute before the court has its origin from what purports to be
agreement of Sale of Shares, but is in fact a disguised sale of portion of a farm
as described in the “principal agreement” which was entered into by the parties
during January 2013.
[2] The agreement was entered into by the plaintiff and his wife (the purchasers)
and the defendant and his wife, and the private company called Jordaan Business
Enterprises (the sellers). The plaintiffs acted in their personal capacity wit h
Jordaan and his wife also acting in person. Jordaan (second defendant) acted on
behalf of the third defendant, Jordaan Business Enterprises Pty Ltd (referred to
as JBE), JBE being a private company. The agreement was for the purchasing of
60 (sixty) shares in the JBE by the purchasers. The Seller (first and second
defendants) holds the entire share capital of the third defendant, JBE. The merx
(object) of the sale agreement at first glance at the written agreement seems to
be 60 shares in JBE at a price of R 250 000-00 per share. The total value of the
merx is R 15 000 000-00 of the entire issued sh are capital and all shareholders
loan accounts and claims against JBE.
[3] The written agreement is the cause of uncertainty because of contradicting
terms, vague description of the merx(s) and apparent lack of consensus between
the parties on specific issues or terms of the agreement. It is trite that the
requirements for a valid contract of sale to come about between parties, there
must be consensus that the agreement is a contract of sale of a specific item ,
that the merx ( item/object being sold/ property being sold) is certain and that
the purchase price is fixed.
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[4] In this matter the requirement regarding the merx is the cause of concern. It
hovers between the sale of 60 shares (the total number of shares in the company
not indicated in the agreement or discussed by the parties prior to signing the
agreement) and the sale and transport of immovable property (a portion of the
farm). The most likely agreement between the partiers is that the agreement
was for the sale of a portion of the farm described as the Remainder of the farm
Buffelshoek 954, Registration Division JG, held under Title Deed T 156250/2005
by the seller (clause 1.18 in the written agreement). Clause 3.1.6 o f the
agreement states that the purchaser will be purchasing this property over a
period of 5 years. Property in the agreement (clause 1.18) means the remainder
of the farm Buffelshoek. This is a further indication as to what was the object of
the sale.
[5] The heading of the agreement clearly states to be a Share Sale Agreement.
The merx of agreement at first glance is the 60 shares in JBE. Although t he
agreement is for the sale of 60 shares, it contains other terms regarding the
transfer of the property (a portion of the farm) and provides for a subdivision of
the property along an identified line across the property. There is no indication
of the total number of shares held by the defendants in JBE or how future
shareholders meetings will take place with the purchasers as new shareholders.
No Shareholders Agreement was in place at any time.
[6] Parties are bound to a written agreement and cannot in general rely on other
evidence or terms around the agreement to prove the real consensus between
them. The parol evidence rule does not allow parties to prove terms not pleaded
unless rectification of the agreement was sought. See Tesven CC v SA Bank of
Athens [1999] 4 All SA 396 (A), 2000 (1) SA 268 ( SCA). Rectification was not
sought in this matter. It came to light during evidence that the object to be sold
sought in this matter. It came to light during evidence that the object to be sold
was not the sale of shares but the sale of a portion of land (the existing farm to
be sub -divided into 2 portions ) as part of the obligations placed on the
purchasers. This is the most likely interpretation of the intention between the
parties if the further obligation on the purchaser to sub -divide the property is
taken into account. Parties are allowed to testify and explain the terms of an
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agreement where the terms are vague or in contradiction with other terms in
the same agreement.
[7] Contrary to what was argued on behalf of the defendants that the issue of
the sub -division was to be dealt with in future (par 5.3 of the heads of
arguments), clause 3.1.5 of the agreement stipulates that the Purchasers shall
be purchasing this Property over a five year period. The Property is defined as
The Farm known as the Remainder of the farm Buffelshoek 954, Registration
Division JQ. This can only be interpreted to mean a portion of the land. The
alleged Sale of Shares is therefore an attempt to disguise the true nature of the
agreement.
[8] A further confirmation of the real intention of the parties is found in Exhibit
“K”. This is the letter dated 26 September 2017 on behalf of the defendants to
the plaintiffs where the plaintiffs are reminded that no indication of the
proposed sub-division of the property was being initiated by the plaintiffs and
that the term of the contract ends on 31 January 2018 and that no extension of
time will be provided by the defendants. The only inference from the letter is
that the sub -division had to be comp leted before the agreement r an out and
that the sub -division was not as argued on behalf of the defendants a future
aspect (see above reference to the written heads of arguments obo the
defendants in par 5.3 thereof). This further proves that the agreement was for
the sale of land and that the sale of shares was a disguise.
[9] The parol evidence rule consists of two branches independent rules or sets of
rules. These are (i) the integration rule which defines the limits of the contract
and (ii) the interpretation rule which determines when and to what extent
extrinsic evidence may be adduced to explain of affect the meaning of the words
contained in a written contract. University of Johannesburg v Auckland Park
Theological Seminary and Others 2021 (6) SA 1 CC at [90]. The court allowed
Theological Seminary and Others 2021 (6) SA 1 CC at [90]. The court allowed
evidence by the parties to clarify certain murky issues regarding the terms of the
agreement but this did not alter or brought about “terms” not contained in the
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agreement. It was to explain the existing agreement with regard to sale of shares
or property (clause 1.18) and the sub-division envisaged.
[10] The plaintiffs pleaded the contract to be illegal for reason of the
contravention of Section 3 and 4 (2)(b) of the Subdivision of Agricultural Land
Act, no 70 of 1970 (the Act). The defendants’ argument that the sub-division
was for the future cannot succeed. This is contrary the letter of demand (Exhibit
“K” supra) on behalf of JBE dd 28 September 2017 to the plaintiff demanding
completion of the sub -division of the property before the time span of the
agreement to be completed . In view of the weight of the evidence , the actual
agreement was the sale of a portion of the farm after sub-division, then the non-
compliance to obtain prior consent by the Minister before the agreement was
completed, renders the agreement ab initio void.
CONTRACTUAL PRINCIPLES:
[11] The parties must have reached consensus of what was t he subject of the
agreement i e the sale of land (portion of the farm) or sale of shares and the
price must be fixed. The closest the parties ventured to consensus was the price,
but the price in the written agreement was for the sale of 60 shares. There is
further no clear description of the land but for clause 1.18 what was to be sold
to the purchaser. The imaginary line drawn in clause 4.1.2 of the written
agreement where the sub-division should be does not justify the agreement to
be the sale of shares. As a matter of interest the argument on behalf of the
defendants in par 32 and further in the written heads of arguments seems to be
a mistake as there is no clause 4.2.1 I the agreement. Most likely reference is
made to clause 4.1.2 and 4.1.3 of the agreement.
[12] In any event the second defendant testified that the plaintiffs were in breach
as early as in 2014 but that the breach was corrected. The letter of 26 September
2017 (Exhibit ‘K”) according to the second defendant, should not be seen as a
2017 (Exhibit ‘K”) according to the second defendant, should not be seen as a
demand to correct a breach but a mere reminder that time was running out to
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complete the sub-division. This letter clearly contradicts any suggestion that the
sub-division was for future after the agreement was finalised. This letter is a
further indication that the sub-division was part of the agreement and can only
strengthen the inference that the agreement was for sale of land.
[13] The parties are identified in the written agreement, the price is fixed but the
merx remains uncertain. The written agreement starts off with the number of
shares to be transferred, the value thereof etc. It is only towards the latter terms
of the agreement in clause 11.3 that the agreement stipulate that “It be known
that the purchaser is purchasing the remaining farm 954 Buffelshoek, and not
the Silver Creek Gorge Estate…” This description of the land does not meet the
requirements of identifying land in a contract of sale. The property refers to the
farm known as the Remainder of the farm Buffelshoek 954, Registration
Division JQ, held under title deed T1562 50/2005 by the Seller (Clause 1.18 of
the written agreement). There can be no doubt from the above that the real
merx was the remainder of the farm and not the shares.
[14] There is no indication of the size of land purportedly to be purchased from
the seller, but this may be an indication that the real intention between the
parties is the sale of the remaining portion of the farm after the envisaged sub-
division of the farm along the line along the runway south east of the hangers
and not the shares. This deepens the plot of what the true intention of the
parties was.
[15] The provisions in clause 4.1.2 places the obligation on the purchaser to have
the property sub-divided on the imaginary line which runs behind the hangers
to the south-east of the hangers before the agreement is finalised. This line was
indicated during evidence on an aerial photograph of the farm. The only
reasonable inference from this clause is nothing else but the purchaser had the
reasonable inference from this clause is nothing else but the purchaser had the
obligation to have the farm sub -divided as part of the agreement . Sub-division
of the farm can hardly be part of an ordinary contract for the sale of shares. The
only reasonable inference is that the parties wanted to enter into a sale of land
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agreement but became strangled in an agreement drafted by a legal professional
who lost the basic plot along the line trying to provide for almost everything that
possibly from the law of contract.
[16] If the true intention of the parties was that the merx was the remaining
portion of the farm Buffelshoek, the failure to comply with the provisions of the
Sub-Division of Agricultural Land (supra) renders the agreement ab initio void.
To determine the true meaning of a written agreement the court may he ar
evidence as to the context of the language used by the parties and the context
in which the provisions appear. In this matter the court allowed evidence by the
witnesses regarding what transpired when the parties met and how they
approached the agreement. See Natal Joint Municipal Pension Fund v Edumeni
Municipality 2012 (4) SA 593 (SCA) par [18]. A similar dictum is found in Capitec
Bank Holdings Ltd v Coral Lagoon In vestments 194 (Pty) Ltd 2022 (1) SA 100
(SCA) at par [38].
[17] The appointment of a conveyancing attorney (clause 1.5) for the transfer
and registration of the concerning the property of the company can only be to
complete the transfer of the property after the sub-division is completed. There
is no need to appoint a conveyancer when shares are transferred, more likely a
notary to complete such transfer.
[18] If the agreement was for the sale of shares, one would have expected that
there would have been minutes of shareholders meetings as required in the
Company Act and some indication of what the position of the purchasers as new
shareholders were. The updating of the share register must place when shares
are sold. In this matter nothing of kind is mentioned or has taken place. For five
years nothing transpired to support any submission that the true intention of the
parties was the sale of shares.
[19] There is no indication of any annual reports etc on behalf of JBE. There is no
[19] There is no indication of any annual reports etc on behalf of JBE. There is no
indication of profit sharing between the shareholders which further supports the
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inference that the true intention of the parties was the sale of a portion of the
farm. There is no indication how JBE would be managed after the sale of shares,
how the shareholders meetings will take place and the aggregate of
shareholding. It was only during the second defendant’s evidence that it came
to light that the total shareholding was 100 shares, resulting in the plaintiffs
becoming the majority shareholders. The reasonable inference from this is that
the defendants never intended relinquishing a ny shareholding in JBE and that
the plaintiffs were purchasing the remainder of the farm as set out in clause 1.18
of the agreement.
[20] A further indication that the agreement was indeed the sale of a portion of
the farm is the institution of a counterclaim by the defendants. If the agreement
was the sale of shares there can be no basis for such claim relying on the plaintiff
taking occu pation of the farm. Occupation is only possible if the underlying
intention was the sale of the farm. If the purchasers were shareholders, the
defendants had equal rights as shareholders of JBE; retaining the rights they
enjoyed previously as shareholde rs. This included the right of occupation as
before. The whole basis of the counterclaim based on occupation by the
purchasers evanishes because there is no indication what the various
shareholders’ obligations and rights were. The defendants have no claim of kind
against co -shareholders for damages as formulated in the counterclaim. JBE
might have a claim against all shareholders for failure to comply with basic
company law.
[21] The underlying intention of the parties favour s the sale of land to the
purchasers. If all the evidence and pleadings are considered, the reasonable
inference can only be that the parties intended the agreement to be an
agreement of sale of land (as described in clause 1.18 of the written agreement).
To that extent the evidence by both pa rties as to the intention of the parties,
To that extent the evidence by both pa rties as to the intention of the parties,
including the underlying sub -division obligation on the purchasers can only be
that of sale of land. This accepted, the non -compliance with the statutory
requirement of the provisions of section 3 and 4(2)(b) of the Subdivision of
Agricultural Land Act 70 0f 1970 renders the agreement invalid (null and void).
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[22] The defendants had no intention to deliver any share certificates to the
purchasers and the second defendant could not give any explanation during
evidence of this breach from their side if the agreement was the sale of shares.
This “breach” further explains the true intention of sale of land.
[23] The second defendant did not impress as a witness. He had no explanation
why the share certificates were not delivered as stipulated in the agreement. He
could not account for who received the continued income from the occupiers of
certain of dwellings on the farm as from date of the agreement until termination
of the agreement. There is no evidence by the defendants of any crops under
the second pivot repaired by the plaintiff. There was no evidence by the
defendants of any crops managed by the defendants before, during and after the
agreement. The listing of game on the farm was randomly done without any
counting thereof and to further illustrate the unreliability thereof is the listing of
30 jackal as part of the exchange. To include jackal at a fixed price in the list is
illustrative of the absurdity thereof.
[24] The evidence by the expert Mr van Zyl is a mere grasp in the air based on
no substantive evidence that the defendants in fact utilized the farm to any
extent but for the lawn business under the one pivot. There is no evidence that
the defendants or JBE ever intended cattle farming to support any claim for loss
of grazing income. The lodge (farm homestead) was fenced off together with the
unit occupied by the parents of the first defendant. The plaintiffs had no access
thereto. Van Zyl made no contact with any farmers or landowners in the area to
have any idea what the going rate for grazing, letting of living units or cultivation
of crops were to make any calculation regarding alleged damages. This negates
any claim for loss of income as stated in the counterclaim. The second
defendant’s evidence was that he was only interested in enjoying the game farm
defendant’s evidence was that he was only interested in enjoying the game farm
and he had no intention in cattle farming at any stage.
[25] The counterclaim was with respect a mere attempt to scare the plaintiffs
and lacks context. It cannot succeed.
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[26] The plaintiffs instituted four different claims namely (i) repayment of the
amount of R 4 380 050-00 paid to the defendants to date of summons; (ii)
payment of the amount of R 305 789-33, the value of the game agreed and listed
in Exhibit “G” in exchange for the work done at the runway; (iii) payment of the
amount of R 443 061-02 for improvements brought about on the farm during
possession thereof; and (iv) the return of certain moveable items brought onto
the farm by the 1st plaintiff with the rei vindicatio.
[27] The plaintiff during evidence abandoned claim 3 regarding the
improvements brought about on the farm. Although certain improvements and
maintenance were done by the plaintiff, the plaintiff abandoned it for evidential
reasons. It remains unclear whether the runway (claim 2) was completed and
tarred as agreed. Although certain work was done on the runway, there was no
clear evidence about the exact work done and whether the runway was tarred
at all and at what cost this was done . In view of lack of convincing evidence
regarding the work done on the runway, an order of absolution of the instance
on claim 2 is granted. It remains a fact that the plaintiff did improve the farm
regarding updating of dilapidated fences, inserting new droppers in the fences
and re-wiring the one out-of-order pivot and coupling a new pump machine to
the pivot. The difficulty of the plaintiff was to quantify the improvements.
[28] The 2 nd defendant confirmed during evidence that certain movable items
brought onto the farm by the 1 st plaintiff was there and tendered the return
thereof. He invited the plaintiff to collect these items. These items are the
Cruiser, two firefighters, three water tanks, three drinking bowls and feeding
bowls. The motor pump was apparently stolen and the defendants replaced such
with another pump. There can be no dispute that the defendants must return
these items.
[29] The 2nd defendant testified that the two giraffes brought to the farm by the
[29] The 2nd defendant testified that the two giraffes brought to the farm by the
plaintiff died and the carcasses were still on the farm and could be removed. No
time frame of death of the giraffes was given and it is strange that the carcasses
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would still be on the farm after all the years despite carnivores like jackal and
other to pray on the carcasses . The defendant argued that the plaintiff only
proved that he brought one Nyala bull to the farm. If so, the Nyala should also
be returned. The defendant further stated that the ten waterbucks are no longer
on the farm, but no reasonable explanation was given to prove this. There is no
convincing evidence by the defendant regarding the remainder of the game and
the defendant must return the items tendered and at least one Nyala bull.
[30] The critical consideration is that of 1st claim for repayment of the amounts
paid by and on behalf of the plaintiffs in terms of the now unlawful agreement.
The plaintiffs’ claim is for R 4 380 050-00 while the defendants calculated the
amounts received to be R 4 395 000-00 (annexure “E”).
[31] The question whether the defendants should be ordered to repay the
amounts paid over to them by the plaintiffs (or on their behalf) is whether the
defendants were enriched at the expense of the plaintiffs. Were the plaintiffs
impoverished and if so, are they prevented to claim repayment by the par
delictum rule.
[32] An illegal contract has to be distinguished from an invalid contract because
of non -compliance with statutory formalities and an unenforceable contract.
The agreement before court is pleaded to be contrary a law.
[33] The plaintiffs pleaded that the contract was contrary the law the provisions
of Section 3 and 4 of the Sub-Division of Agricultural Land Act 70 0f 1970 because
no prior consent was obtained from the Minister authorising the envisaged sub-
division of the farm into two portions. There is no dispute between the parties
that this consent was never obtained. The defendant avers the consent was not
necessary because the agreement was not sale of land but sale of shares. It was
already held supra that the agreement was for the sale of the remainder portion
of the farm (clause 1.18 of the agreement).
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[34] The plaintiff pleaded that it was relying on the illegality of the agreement.
See F & I Advisors (Edms) Bpk v Eerste Nasionale Bank van Suidelike Afrika Bpk
1999 (1) SA 515 (SCA); Bekker v Oos-Vrystaat Kaap Koorperasie Bpk [2000] All
SA 301 (A).
[35] The party who has performed in terms of an illegal contract (fully or partly)
may reclaim such performance with the condictio ob turpem vel iniustam causa.
See First National Bank of South Africa Ltd v Perry NO 2001 (3) SA 960 SCA.
With the contract being illegal, the defendants cannot rely on the clause 3.1.1
and 3.1.2 to withhold any non-refundable deposit.
[36] To succeed with the condictio as an enrichment claim, the plaintiff must
prove: (i) that a transfer of money (or goods) to the defendant has taken place.
(ii) that the transaction was illegal; and (iii) that the defendant was unjustly
enriched. See Albertyn v Kumalo 1946 WLD 529 at 535. If the contract is invalid,
(but not illegal), the cause of action is the condiction indebiti.
[37] The defendant can raise the par delictum rule as defence i e that the plaintiff
was a party to the illegality. Bhyat’s Departmental Store (Pty) Ltd v Dorklerk
Invetments (Pty ) Ltd 1975 (4) SA 881 (A). It is then for the plaintiff to allege and
prove facts that will enable the court to his assistance because of justice and
public policy so required. Jajbhay v Cassim 1939 AD 537, Visser v Rousseau NO
1990 (1) SA 139 (A).
[38] The plaintiffs in pr 4 of the replication to the defendants’ replying to par 5
of the defendants’ plea, stated that none of the parties were aware of the illegal
nature of the agreement. The evidence of the first plaintiff was that after the
letter of demand dated 26 September 2017 on behalf of the defendant
demanding completing of the sub-division, that he obtained legal advice that the
agreement was invalid due to non -compliance of the required consent of the
Minister for sub -division. The defendants admitted such in their plea. Both
Minister for sub -division. The defendants admitted such in their plea. Both
parties at the stage when the agreement was entered into had no knowledge of
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the illegality of the agreement. This knowledge was only obtained after the letter
of 26 September 2017. Both parties admitted this in the pleadings. The court is
satisfied that in view of the admission by both parties that there are grounds to
relax the par delictum rule.
[39] The court may relax the par delictum rule in the interests of justice where
the turpitude of the transaction does not outweigh the injustice of the resulting
situation. It is a question of fact in each instance to determine the turpitude and
the injustice that will be caused if the rule is strictly applied. See Jajbhay supra
at 542.
[40] The plaintiff must prove impoverishment and that the defendant is
enriched. In the present case the plaintiff paid an amount of R 4 380 050-00
(although the defendants aver that the amount of R 4 395 000-00 – in plea) was
received). It is further trite that the plaintiffs’ daughter and a private company
linked to the plaintiffs made certain payments towards the defendants. The
defendants received these payments without complaining about the payee
thereof. The first plaintiff gave evidence why this was done and although
somewhat shaky it was not denied that these payments were in terms of the
agreement. There is no rule that only payments made by a plaintiff may be
considered to determine whether there were enrichment of the defendants and
the impoverishment of the plaintiffs.
[41] The defendants gladly accepted these payments and the reasonable
inference is that the defendants benefitted from the payments and the
improvements made by the plaintiff and it can safely be held that the defendants
were enriched by receiving these payments. The defendants cannot benefit form
payments or improvements made in terms of an illegal agreement and it would
be in the interest of justice for the defendants to repay what was received in
terms of the illegal agreement. T he defendants cannot hide behind a strict
terms of the illegal agreement. T he defendants cannot hide behind a strict
compliance of the par delictum rule only because the evidence on behalf of the
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plaintiff why these payments were made by third parties was somewhat shaky.
The court may relax the rule in the interest of justice as set out in Jajbhay supra.
[42] The defendants, via their shareholding in JBE (third defendant) never lost
their dominium over the property as shareholders and may claim at most some
compensation for occupation by the plaintiffs. The expert witness’s evidence did
not assist the defenda nts at all in this regard and at most the defendants are
entitled to absolution of the instance on the counterclaim. See Jajbhay supra at
557. As indicated supra the court is satisfied that the counterclaim be dismissed.
The dictum of Jajbhay was followed in Blacher v Josephson 2023 (3) SA 555
(WCC) par [33] to [36].
[43] The agreement being illegal disqualifies the defendants from retaining any
non-refundable deposits or any other amount. See [35] supra.
ORDER:
1. Claim 1: The defendant is to repay the amount of R 4 380 050-00 received
from the plaintiffs and their nominees during the time while the
agreement was operative within 60 days from date of this order.
2. Claim 2: Absolution of the Instance is ordered.
3. Claim 3: The claim was abandoned.
4. Claim 4: The defendants are to return to the plaintiffs the items admitted
to be in its possession namely the Land Cruiser ; two fire-fighters (one a
mobile and the other a bakkie firefighter); three (3) water tanks; three (3)
drinking bowls; three (3) feeding bowls ; and one Nyala Bull, and if not
15
possible to deliver the Nyala Bull, the 2018 money equivalent of such bull
when summons was issued.
5. The defendants to pay the costs of the plaintiffs on a party-and-party scale
inclusive of counsels’ fees on scale B.
___________________________________
HOLLAND-MUTER J
Judge of the Pretoria High Court
Appearances:
Plaintiffs: Adv E van Rensburg
Defendants: Adv P Van Der Berg SC
Days in Court: 21/10; 22/10; 23/10; 30/19/2025.
Judgment reserved on 30/10/2025.
Judgment delivered by uploading the judgment onto CaseLines on 02/01/2026