Burger and Another v Edenglo Holdings (Pty) Ltd and Others (6534/18) [2018] ZAWCHC 141 (4 October 2018)

Burger and Another v Edenglo Holdings (Pty) Ltd and Others (6534/18) [2018] ZAWCHC 141 (4 October 2018)

The court found that while the applicants did not establish fraud or misrepresentation in the sale and leaseback scheme, the agreements were unconscionable and contrary to public policy due to the exploitation of the applicants' financial vulnerability, lack of transparency in the disbursement of sale proceeds, and oppressive terms. The applicants' intention was not to permanently alienate their property but to save it from foreclosure and retain occupation. The court held that the scheme and subsequent agreements were void ab initio, and the subsequent transfers and registrations must be set aside. The Registrar of Deeds was directed to restore the property to the applicants. Each party...

Citation
[2018] ZAWCHC 141
Parties
Applicant: Dirk Burger; Applicant: Nadia Burger; Respondent: Edenglo Holdings (Pty) Ltd; Respondent: Leonie Dempers; Respondent: Minerva Merissa Baugaard; Respondent: Ian William John Baugaard; Respondent: First National Bank Limited; Respondent: Registrar of Deeds, Cape Town; Respondent: Wonderful Choice Investments; Respondent: Gert de Wet N.O.; Respondent: Gladys Nkateko Ngobeni N.O.
Court
Western Cape High Court, Cape Town
Jurisdiction
South Africa
Judgment Date
4 October 2018
Case Number
6534/18
Procedural Posture
Review Application / Judgment
Outcome
Application granted. The sale and subsequent transfers of the property are declared void ab initio and set aside. Registrar of Deeds directed to restore property to applicants. Each party to pay its own costs.
Judges
Ndita
Legal Topics
Public Policy in Contract, Deeds Registries Act, Fraudulent Transfer, Sale and Leaseback, Eviction Proceedings
Land and Property Civil Procedure Public Policy in Contract Deeds Registries Act Fraudulent Transfer Sale and Leaseback Eviction Proceedings

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Parties

Dirk Burger

Applicant

Nadia Burger

Applicant

Edenglo Holdings (Pty) Ltd

Respondent

Leonie Dempers

Respondent

Minerva Merissa Baugaard

Respondent

Ian William John Baugaard

Respondent

First National Bank Limited

Respondent

Registrar of Deeds, Cape Town

Respondent

Wonderful Choice Investments

Respondent

Gert de Wet N.O.

Respondent

Gladys Nkateko Ngobeni N.O.

Respondent

Procedural Posture

Review Application / Judgment

Legal Issues

  1. 1 Whether the sale and subsequent transfer of the applicants' immovable property was fraudulent and/or invalid and contrary to public policy.
  2. 2 Whether the agreements between the applicants and the respondents are void ab initio due to unconscionable terms and exploitation of financial vulnerability.
  3. 3 Whether the subsequent transfers and registrations should be set aside and the property restored to the applicants.

Ratio Decidendi

The court found that while the applicants did not establish fraud or misrepresentation in the sale and leaseback scheme, the agreements were unconscionable and contrary to public policy due to the exploitation of the applicants' financial vulnerability, lack of transparency in the disbursement of sale proceeds, and oppressive terms. The applicants' intention was not to permanently alienate their property but to save it from foreclosure and retain occupation. The court held that the scheme and subsequent agreements were void ab initio, and the subsequent transfers and registrations must be set aside. The Registrar of Deeds was directed to restore the property to the applicants. Each party...

Court Disposition

Application granted. The sale and subsequent transfers of the property are declared void ab initio and set aside. Registrar of Deeds directed to restore property to applicants. Each party to pay its own costs.

Orders

  • It is declared that the transaction constituted by the deed of sale and lease executed by the applicants and the second and/or seventh respondents is contrary to public policy.
  • The sale and transfer of the immovable property from the applicants to Wonderful Choice Investments (Pty) Ltd, and the subsequent transfer to Minerva Merissa Baugaard and Ian William John Baugaard, is cancelled.