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[2014] ZAWCHC 25
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Vanilla Street Home Owners Association v Ismail and Another (A345/2013) [2014] ZAWCHC 25 (5 March 2014)
THE REPUBLIC OF
SOUTH AFRICA
IN THE HIGH COURT
OF SOUTH AFRICA
WESTERN CAPE
DIVISION, CAPE TOWN
Case
No: A345/2013
DATE:
05 MARCH 2014
In the matter
between:
VANILLA STREET
HOME OWNERS ASSOCIATION
.......................
Appellant
And
BASHEERA
ISMAIL
..................................................................
First
Respondent
NADINE GLORIA
LEWIS
.....................................................
Second
Respondent
5 MARCH 2014
JUDGMENT
BOZALEK J:
[1] The appellant, a
homeowners’ association established in terms of section 29 of
the Western Cape’s Land Use Planning
Ordinance 15 of 1985
(‘LUPO’), instituted motion proceedings against the
respondents, the joint owners of a registered
property in the
development known as Bardale Village in Kuilsriver, in which it
sought an order that they be interdicted and restrained
from
conducting a business from such property. The application was opposed
by the first respondent and was ultimately dismissed
per Savage AJ
with no order as to costs.
[2] The appellant
now appeals against the judgment and order.
[3] The appellant’s
case is that in terms of the original written sale agreement relating
to the property, and a condition
of the title deed, the respondents,
as its registered owners, were members of the appellant and were
bound by its constitution
and conduct rules. Clause 11.1 of the
constitution determined that any property in the development (Bardale
Village) should, save
in limited circumstances, be used solely for
residential purposes. In breach of this provision first respondent
had been conducting
a hair salon from her property since June 2008.
Despite repeated demands by the appellant to refrain from doing so
and notwithstanding
her undertaking in writing that she would cease
to do so, the first respondent (whom I shall refer to henceforth as
‘the
respondent’, except when there is a need to
distinguish her from the second respondent) continued to conduct the
business
and as such the appellant had no alternative but to bring
the interdict proceedings.
[4] The respondent’s
case is a little difficult to discern because the papers which she
filed in opposing the application
appeared to have been drawn up
without legal representation. Her main defence appears to have been
that the zoning scheme established
for the development in terms of
LUPO permitted the conduct of an ‘occupational practice’
from the premises and, as
such, her running of the hair salon. As a
conjoined defence the respondent contended that her operation of the
business caused
no trouble or discomfort to any neighbour and that
the community in Bardale Village was in favour of its retention.
Coupled to
this defence it was the respondent’s case that
economic circumstances had forced her to trade from home as opposed
to leased
commercial premises. The respondent appeared also to
contend that by prohibiting the use of the property for anything
other than
residential purposes, the appellant had effected a
non-procedural amendment to its constitution by purporting to
override the zoning
scheme’s provisions.
[5] In addition the
respondent appeared to place some reliance upon her allegation that
at the time of purchasing the property she
had not been informed of
the existence of the appellant or the provisions of its constitution.
In argument on behalf of the respondent,
Ms e Câmara sought to
expand these grounds of defence to include the contention that the
respondent had concluded the underlying
agreement under a
misapprehension and was not bound by its terms. Finally, the
respondent sought to rely on the fact that the appellant
had not
utilised the arbitration provisions in its constitution before
launching the interdict proceedings.
[6] In dismissing
the application the Court a quo found that the appellant had failed
to prove a clear right in that LUPO did not
grant to the appellant
the right to limit or restrict the use rights determined by the
zoning scheme by way of a provision of its
constitution or its
conduct rules. It found further that, on the evidence before it, it
was unable to determine whether the appellant
had alerted the
respondent, prior to her purchase of the property, of the existence
of those provisions of the constitution which
prohibited the use of
the premises for purposes other than residential. The Court a quo
found in any event that by virtue of the
discreet manner in which the
respondent had conducted her business the appellant had failed to
prove the existence of an injury
or the reasonable apprehension of an
injury. Finally, the Court a quo noted that it was not persuaded that
there was no alternative
remedy available to the appellant other than
the interdict proceedings.
[7] On appeal it was
contended on behalf of the appellant that the Court a quo had erred
in not finding that it had succeeded in
proving the requirements for
a permanent interdict namely, a clear right, an injury suffered or
reasonably apprehended and the
absence of any alternative remedy.
[8] The first and
main issue in relation to the question of whether a clear right was
established by the appellant is whether the
provisions of the zoning
scheme, which allows for a property owner to conduct a ‘home
occupation’ from such property,
prevail over the provisions of
the appellant’s constitution and conduct rules which purport to
prohibit such a use.
[9] The precise
provisions of the zoning scheme applicable to the property are
somewhat complicated by the fact that only after
judgment was
delivered by the Court a quo was it realised that the original zoning
scheme regulations had been replaced by new
scheme regulations which
came into effect on 1 March 2013
1
. Be that as it may, it was common cause that it was reasonable to
assume that the current zoning of the property was ‘single
residential’ and that clause 5.1.1(b) of the scheme regulations
provides that one of the additional use rights that may be
exercised
by the occupant of a property so zoned is a ‘home occupation’
2
which must be conducted subject to the conditions stipulated in such
clause and 5.1.3. The concept of a ‘home occupation’
appears to be the equivalent of what was known as an ‘occupational
practice’ in terms of clause 4.9.1 and 4.9.2 of
the
pre-existing scheme regulations.
[10] Given the view
which I take of this matter it is, strictly speaking, unnecessary to
determine whether the respondent’s
business constitutes a ‘home
occupation’ within the meaning of and in compliance with the
new scheme regulations. The
appellant was prepared to concede that
the respondent’s use of the premises satisfied that definition.
Certainly, that was
the view which was taken by the relevant official
of the City of Cape Town which, although not a party to the action,
responded
to the respondent’s query about her rights under the
zoning scheme regulations in the following terms:
‘The subject
property, namely Erf 20703, Blue Downs (Bardale Village) is situated
at 43 Ginger Road and is zoned “Special
Zone (Subzone 3)”
in terms of the Land Use Planning Ordinance, 1985 (Ordinance 15 of
1985), Section 8 Zoning Scheme Regulations
and may mainly be used for
single residential purposes as per the aforementioned Scheme.
However, in terms of Section 4.9.1(c),
a portion of a dwelling unit
may be utilised as an occupational practice meaning the practicing of
an occupation, or a trade, or
the conducting of an enterprise from a
dwelling unit by one or more occupants of the dwelling unit concerned
and his or their assistants,
without disturbances such as noise,
traffic congestion, air pollution, the congregation of people,
excessive traffic generation
or a lowering of aesthetics being
caused; provided that a general medical practitioner shall be exempt
with regard to occupancy.
Further it is
imperative to note that the proposed land use activity (namely a
small scale hair salon) to be conducted from the
subject property
conforms to the aforementioned definition of an occupational
practice.’
[11] I approach the
question of whether the respondent’s use of the property fell
within the zoning scheme regulations with
some caution not least
because the above-cited opinion of the director in the Department of
Planning and Building Development Management
within the City of Cape
Town is not necessarily definitive of this question, notwithstanding
its emphatic tone. For one thing,
the pre-existing zoning regulations
provided that where a portion of the dwelling unit was utilised for
purposes of an occupational
practice, such premises ‘shall not
be used for purposes of a shop, business premises, an industry or an
noxious trade;’.
Assuming that the new scheme regulations
contain similar provisions this raises the question of whether that
portion of the respondent’s
premises which she used as a hair
salon did not constitute ‘business premises’ and as such
breached the scheme regulations
concerning what is now termed a ‘home
occupation’.
[12] For these and
other considerations I consider that it is not necessary to determine
whether the respondent’s use of her
property fell within the
exclusion relating to ‘home occupation’ since the prior
and real issue between the parties
is whether, where the provisions
of the homeowners association’s constitution and conduct rules
are more restrictive than
the zoning scheme regulations, which
prevail.
[13] The appellant
is a body corporate with perpetual succession and its own rights and
liabilities duly established in terms of
section 29 of LUPO. That
section, falling within the chapter of LUPO dealing with the
sub-division of land, provides that either
the Administrator or the
council concerned … ‘may impose conditions under s42 as
(sic) the granting of an application
for sub-division in terms of
s25(1) in relation to the compulsory establishment by the applicant
for sub-division of a homeowners’
association’.
[14] Section 29(2),
a key subsection, reads as follows:
‘A home
owners’ association coming into being by virtue of the
provisions of subsection(1)
a) shall be a body
corporate;
b) shall have a
constitution which –
i) has as its
object the control over and maintenance of buildings, services and
amenities arising from the sub-division concerned;
ii) provides for the
implementation of the provisions of (c), and
iii) has been
approved by the council concerned in order to ensure that the
provisions of sub-paragraphs (i) and (ii) are being
complied with,
and
c) shall have as it
members the owners of land units arising from the sub-division
concerned, who shall be jointly liable for expenditure
incurred in
connection with the association.’
[15] In its founding
papers the appellant stated that in terms of the sale agreement under
which the respondents became the owners,
and also in terms of a
condition of the property’s title deed, they became members of
the appellant for so long as they remained
the registered owner of
the property. The objects of the appellant are defined in clause 3 of
its constitution and include ‘the
promotion, advancement and
protection of the communal and group interests of the members
generally in regard to the development’
and ‘to generally
do all such things as may be necessary or requisite to give effect to
and implement the objects of the
Association and to do all such
things ancillary or incidental to the objects’.
[16] Further the
clauses of the appellant’s constitution relevant to the present
matter include the provisions that:
‘10.5 Each
member undertakes to the association to comply with the provisions of
this Constitution and any rules or other
regulations made in terms of
this clause 10.’
’10.7 Any erf
and dwelling shall be used solely for residential purposes, save as
otherwise expressly stipulated by a special
resolution and, during
the development period, approved in writing by the developer,
provided that any use of the dwelling shall
always comply with the
local zoning scheme regulations.’
Also relevant is
clause 11.1 of the appellant’s conduct rules which state inter
alia as follows:
‘11.1 No owner
of occupier of a home shall be entitled to use his or her home for
any purposes other than residential purposes.’
[17] The respondent
did not dispute the existence or relevance of these provisions
explicitly, stating only, without elaboration,
that ‘within the
time of purchasing the house …, were we, First and Second
Respondents never informed of a Constitution
or a Body Corporate’.
I regard this as a bald denial, one which does not make it clear
whether the respondent disputed that
both the deed of sale and the
title deed made it clear that property owners became members of the
appellant and thus bound by the
terms of its constitution and conduct
rules. The respondent’s denial, such as it was, was not in my
view one such as to raise
a real, genuine or bona fide dispute of
fact in relation to this aspect of the appellant’s case as was
envisaged in Plascon
Evans Paint v Van Riebeek Paint
3
.
[18] Nor, in my
view, did the respondent’s denial or assertions regarding her
alleged lack of knowledge of the appellant’s
constitution
create any basis for her to escape being bound by its relevant
provisions. She did not assert that there was any bi-lateral
mistake.
Any suggestion that she might be entitled to rely on a unilateral
mistake was not well-founded since no case was made
out by the
respondent that her error was justus i.e. that she was the subject of
an innocent or fraudulent misrepresentation and
that she had not led
the appellant, acting reasonably, to believe that she was nonetheless
binding herself to the agreement of
sale
4
.
[19] The Court a quo
reasoned that LUPO did not grant to the appellant, or other
associations like it, the right to limit or restrict
the use rights
determined by a zoning scheme by way of a provision in its
constitution or conduct rules. In reaching this conclusion
it relied
on what it regarded as the clear and unambiguous wording of section
29(2) of LUPO which, it held, did not expressly state
that a
homeowners’ association enjoyed the right to ‘determine
or restrict the usage of property in circumstances in
which a zoning
scheme has determined use rights’. It held further that in
order to exercise such a right the relevant stipulation
would have to
have expressly granted that power, clearly and unambiguously.
[20] I find myself
in respectful disagreement with this conclusion. The scheme
surrounding, and the wording employed in, section
29 contemplates, in
my view, the homeowners’ association having reasonably wide
powers, certainly wide enough to provide
that ownership or occupation
of the properties forming part of the development might involve a
derogation from the land use rights
otherwise accruing to those
properties in terms of the zoning or zoning scheme regulations. Such
a step falls well within the ambit
of a constitution which, to quote
from section 29(2)(b), ‘has as its object the control over and
maintenance of buildings,
services and amenities arising from the
sub-division concerned;’. In this regard it is important to
note that the Administrator
or the council concerned enjoys the
ultimate power to approve the provisions of a homeowners’
association’s constitution
in order to ensure that it gives
effect to the objects aforementioned. Had the City of Cape Town been
of the view that the relevant
provisions of the constitution, namely,
that the properties in Bardale Village could only be used for
residential purposes were
unlawful or ultra vires, nothing prevented
it from withholding its approval of the constitution until it
mirrored the provisions
of the zoning scheme as far as land use
rights were concerned. That it evidently did not do.
[21] Furthermore, it
is a premise of the respondent’s argument (and the Court a
quo’s reasoning) that the appellant
was assuming powers which
it did not have, namely the power to alter the zoning of the property
from the terms of use permissible
by virtue of the applicable zoning
scheme. This is to confuse two different concepts. The appellant did
not purport to change the
zoning scheme as it applied to the
properties within the development. That remained intact. What the
appellant sought to do was
to create a dispensation where, by
agreement, every property owner forfeited whatever right it might
otherwise enjoy, in terms
of the zoning scheme or otherwise, to
utilise the land in certain limited respects i.e. for anything other
than residential purposes.
This understanding of the limit of its
power is reflected in Clause 11.1 of the appellant’s
constitution where, under the
heading Use of the Dwelling, provision
is made for the passing of a special resolution allowing a property
owner to use his/her
property for non-residential purposes subject to
the proviso that ‘any use of the dwelling shall always comply
with the local
zoning Scheme Regulations’. To further
illustrate this point, the appellant could hardly have purported,
acting in terms
of its constitution and/or conduct rules, to
stipulate that one or more property owners within the development
could use their
property for uses not permitted by the zoning scheme
regulations, for example, for industrial purposes.
[22] In my view,
therefore, upon a proper analysis of the provisions of LUPO, it falls
within the powers of a homeowners’
association to establish a
constitution which provides that, upon purchase, every property owner
becomes a member of the association
and forfeits, by agreement,
certain land use rights. In the present instance, when the respondent
purchased the property she became
aware, or is deemed to have become
aware, that she forfeited her right to conduct a ‘home
occupation’ from her property
except in specified
circumstances, namely, where the homeowners’ association was
persuaded to pass a special resolution allowing
a property to be used
for purposes other than residential.
[23] In reaching
this conclusion I place some reliance on dicta from New Garden Cities
Inc Association Not for Gain v Adhikarie
1998 (3) SA 626 (CPD)
notwithstanding that it is not all fours with the present matter. In
that case the property developer sold
an erf in one of its
developments to the respondent, the contract of sale containing terms
restricting the use of the property
for residential purposes only.
These terms coincided with the zoning scheme regulations. The
respondent, however, utilised the
property for the purposes of
conducting a general dealer’s business and was in the process
of seeking a temporary departure
from the scheme regulations from the
municipality so as to enable him to operate a shop on the property.
When the developer brought
proceedings to interdict his use of the
property for such purposes, the respondent/owner did not dispute that
he was in breach
of the relevant clause in the contract of sale but
sought on various grounds to escape these provisions. Thus a material
difference
between that case and the present is that the zoning
scheme regulations did not permit the use which the applicant sought
to interdict.
Referring to the term of the contract of sale that the
property should be used only for residential purposes, Rose-Innes J
stated
as follows at 629 H – I:
‘Similar terms
were included in the other contracts of sale of erven in the
township. This was for the mutual benefit of all
the property owners
in what was intended to be a residential township, described by the
applicant as having the character of a
garden village. It is also
common cause that the property has at all material times been subject
to the provisions of a town planning
scheme and that it is
specifically zoned for single residential purposes.’ I
and at page 633 E –
J
‘Clause 13 of
the contract of sale restricts the use of the property to residential
purposes in accordance with the relevant
town planning scheme. The
applicant and the various purchasers of property in the township,
including the respondent were entitled
to agree to such a term. …
A third argument which Mr Möller sought to advance was that the
contract of sale or at least
clause 13 thereof was illegal or
unenforceable, on an application of the principle that a contract
which deprives the owner of
the property of the free right of dealing
with his property is of no effect unless the stipulation serves some
useful purpose to
the owner (Paiges v Van Ryn Gold Mines Estate Ltd
1920 AD 600 at 615). This argument too cannot succeed. A term in a
contract
of sale which restricts the use of properties in a township
to residential purposes is in the interests of all property owners in
the township. It ensures that the residential nature of the area is
preserved, without interference by industry or businesses.
The
applicant, who developed the township, as well as the purchasers of
property have a real interest in the terms of clause 13.’
[24] In the result I
consider that there is nothing in LUPO which prevents an association,
such as the appellant, from limiting
or restricting the usage of the
properties of its members in the manner adopted in the present
matter. Secondly, there is nothing
contained in our law which
prevents a property owner from agreeing to a limitation of its rights
as happened in the present matter.
Accordingly, I consider that the
Court a quo erred in finding that the prohibition on anything other
than residential use contained
in the appellant’s constitution
or conduct rules was unlawful or unconstitutional. It follows in my
view that the Court a
quo erred when it found that the appellant had
failed to establish a clear right.
[25] As mentioned
earlier, the Court a quo found in any event that the appellant had
failed to establish that it had suffered or
reasonably apprehended an
injury. In this regard the Court placed reliance on indications and
assertions in the respondent’s
papers that she conducted the
business discreetly in that she operated by appointment only, without
signage, that her clientele
included residents within the village and
the lack of any evidence that the business was noisy or disruptive.
[26] This approach
confuses a breach of rights with the manner of the breach or its
consequences. It was common cause that the respondent
was in breach
of her obligations in terms of the appellant’s constitution and
the conduct rules in operating the business,
that this had been
carrying on for a substantial period of time and, for good measure,
that she had reneged on an undertaking to
the appellant that she
would cease conducting the business. These facts alone constitute
proof that the appellant had suffered
an injury, namely, the
respondent was using her property for purposes other than residential
and which departure the appellant,
as representative of all other
property owners, was not prepared to condone. Whether the respondent
did so discreetly or otherwise
and the extent to which her clientele
was drawn from the development itself is, in this context,
irrelevant. The appellant was
well within its rights to seek to
preserve the residential character of the development. Were it to
overlook the respondent’s
breach it could hardly be heard to
object at some later stage were other property owners within the
development to use their properties
for commercial purposes, whether
in a discreet fashion or not.
[27] A further
finding challenged on appeal was that the appellant had failed to
establish the absence of similar protection by
any other ordinary
remedy; more particularly in that the Court a quo found that the
appellant was entitled seek an amendment to
the zoning scheme,
presumably to the effect that no property owner within the
development could utilise his or her property for
the purposes of a
‘home occupation’.
[28] This approach
misconstrues the nature of the inquiry at this stage of interdict
proceedings. The third requisite for a final
interdict is the absence
of another adequate remedy which must, inter alia, be adequate in the
circumstances, be ordinary and reasonable,
be a legal remedy and
grant similar protection
5
.
In the context of the present matter any right on the part of the
appellant to seek an amendment to the zoning scheme meets none
of
these requirements. In the first place it presupposes, incorrectly,
that the derogation from the zoning scheme regulations provided
by
the constitution and conduct rules was unlawful and of no force and
effect. Secondly, the remedy falls short of being ordinary
and
reasonable or granting similar protection in that it rendered the
appellant a supplicant for a special dispensation through
an
administrative process rather than allowing it to stand on its
pre-existing rights.
ARBITRATION
[29] Respondent’s
counsel did not press in argument the contention made by in her
papers that the dispute should have been
referred to arbitration
before the interdict proceedings were launched. For the sake of
completeness I note that the appellant’s
constitution does
indeed contain an arbitration clause which covers any ‘dispute,
question or difference relating inter alia
to matters arising out of
the Constitution’ or its interpretation. It was open to the
respondent to refer the matter to arbitration
but she chose not to.
In fact it is also questionable whether there initially was any such
dispute between the parties given that
the respondent appeared,
initially at least, to acknowledge that she was in breach of the
constitution and/or the conduct rules
and undertook to cease
conducting her hair salon business. In any event clause 32.7 of the
appellant’s constitution provides
that, notwithstanding
anything to the contrary contained in the balance of the clause, the
trustees shall be entitled to institute
legal proceedings on behalf
of the appellant ‘by way of application, action or otherwise in
any Court having jurisdiction
for the purposes of restraining or
interdicting breaches of any of these provisions’. In the
circumstances the appellant
was entitled to proceed directly to this
Court, as it did.
[30] In the result,
and for these reasons I consider that the Court a quo erred in not
granting an interdict. There remains the
question of costs and
whether any relief should be afforded against the second respondent.
SECOND RESPONDENT
[31] The second
respondent, in her capacity as co-owner of the property, filed a
‘Notice of Defence’ supported by an
affidavit in which
she advised that she did not reside at the premises in question, that
she had provided only financial support
to her sister to purchase the
property and that she had no interest in the hair salon business
which was solely owned by the first
respondent. In these
circumstances and notwithstanding that the Notice of Defence gave
notice of intention by the respondents to
seek an order allowing the
property to be used also for the purposes of working from and at
home, it seems reasonably clear that
the second respondent was not
opposing the interdict. In the circumstances Mr Van Der Merwe for the
appellant fairly conceded that
his client would not be entitled to a
costs order against the second respondent who took no further part in
the proceedings after
filing the Notice of Defence.
COSTS
[32] The appellant
sought both the costs of the application as well as the costs of the
appeal on the scale as between attorney
and client, in so doing
relying on clause 13.2 of its constitution. That clause provides that
should the trustees of the appellant
institute any legal proceedings
against any member pursuant to a breach by that member of the
constitution, the said trustees shall
be entitled to recover all
legal costs incurred by them or the association, including attorney
and client charges.
[33] A court is,
generally, bound to give effect to an agreement to pay attorney and
client costs and such a provision is not prohibited
by the common
law. The court undoubtedly retains a residual discretion to refuse to
enforce such an agreement in certain circumstances
since costs are in
the discretion of the Court, a discretion which must be judicially
exercised whenever the need arises
6
.
In the present case, however, I can see no compelling reasons why any
costs order should not be made on the attorney and client
scale as
provided by the appellant’s constitution. It must be borne in
mind that to the extent that an ordinary costs order
will not meet
the costs incurred by the appellant, the shortfall will have to made
up from contributions or levies paid by all
the members of the
association. I can see no reason why they should be out of pocket or
why they should have to fund litigation
in the case such as this. It
is also relevant that the respondent gave an undertaking in an early
stage of the dispute that she
would cease conducting the business but
then failed to give effect thereto.
[34] As mentioned
earlier the respondent was represented in this appeal by Adv e Câmara
on a pro bono basis, thanks to the
intervention of the pro bono
committee of the Cape Bar. We are indebted to counsel for her
contribution to the cause of access
to justice in representing the
respondent.
[35] In the result
the following order is made:
1. The appeal is
upheld;
2. The judgment and
order of the Court a quo of 22 March 2013 is set aside and replaced
with the following order;
2.1 The first
respondent is interdicted and restrained from conducting the business
known as Fehmi’s Hair Salon and Barbershop
from erf 20703, Blue
Downs, more commonly known as 43 Ginger Road, Bardale Village,
Kuilsriver, Western Cape (‘the property’)
or to use the
property for any other purpose other than strictly residential
purposes;
2.2 The first
respondent must pay the costs of the application on the scale as
between attorney and client
3. The first
respondent must pay the costs of the appeal including the costs of
the application for leave to appeal on the scale
as between attorney
and client.
BOZALEK, J
I agree
GAMBLE, J
I agree
CLOETE, J
1
Published
in Provincial Notice 337 of 2012 appearing in the Provincial Gazette
70578 of 26 November 2012
2
A
home occupation is defined as the practising of an occupation or the
conducting of an enterprise from; a dwelling house …
by one
or more occupants who reside on the property; provided that the
dominant use of the property concerned shall remain for
the living
accommodation of the occupants, the property complies with the
requirements contained in this zoning scheme for a
home occupation
and home occupation does not include a house shop.
3
1984
(3) 623 (AD)
4
See
George
v Fairmead (Pty) Ltd
1958 (2) SA 465 (A) at 471 B – D
5
Chapman’s
Peak Hotel (Pty) Ltd v Jab and Annelene Restaurants cc t/a O’
Hagan’s [2001] 4 All SA 415, 420
6
See
Sapirstein
v Anglo African Shipping Co (SA) Ltd
1978 (4) SA 1 (A) at page 14.