Chevron South Africa (Proprietary) Limited v Ebisu Dealers CC and Others (8523/2017) [2019] ZAGPJHC 91 (14 March 2019)

REPUBLIC OF SOUTH AFRICA

IN THE HIGH COURT OF SOUTH AFRICA

GAUTENG LOCAL DIVISION, JOHANNESBURG

CASE NO: 8523/2017

In the matter between:

CHEVRON SOUTH AFRICA (PROPRIETARY)

LIMITED APPLICANT

AND

EBISU DEALERS CC FIRST

RESPONDENT

C J & C K (PROPRIETARY)

LIMITED SECOND

RESPONDENT

JONES: CAROLINE THIRD

RESPONDENT

KEYSER: CHRISTELLE FOURTH

RESPONDENT

JUDGMENT

TWALA J

[1] There are four applications before this Court. The first application is by the applicant which seeks an order to interdict the

respondents, the second application is the contempt of the Court order granted on the 29th March 2017, the third application is a counter application by the respondents to the applicant’s application for contempt of court and the last one is an application by the respondents to refer their counter application to trial.

[2] The genesis of these applications stems from a restrictive condition of title embodied in the title deeds of the properties known as Erf 1415 Kenmare Township, Registration Division I. Q., Gauteng, situate at corner Terenure and Carrick Streets, Kenmare; Erf 511 Kenmare Township, Registration Division I.Q., Gauteng and Erf 513 Kenmare Township, Registration Divivsion I.Q., Gauteng, owned by the first and second respondents. Put differently, the issues in this case arise from the servitude registered against the aforementioned properties of the first and second respondents in favour of the applicant.

[3] For the purposes of this judgment, I propose to refer to the parties as the applicant and respondents and to the three erven as the property. I further propose to first deal with the contempt of Court application after a brief history of the matter.

[4] When the applicant sold the property to Domestic and Foreign Trade cc in 2009, it was a condition of the sale agreement that a condition be created and embodied in the title deed of the property in favour of the applicant ‘that for a period of 25 years reckoned from the date of transfer of the property, the property shall not be utilized for any purpose other than the purpose of carrying on the business of a Caltex Branded Service Station’. This condition was registered in the Deeds Office and was carried forward into the title deed of the respondents when they acquired

ownership of the property in 2016.

[5] In 2016 the respondents instituted motion proceedings against the applicant in the Gauteng Division of the High Court under case number35042/2016 seeking an order to remove or expunge the restrictive condition (servitude) of title which is registered in favour of the applicant. The application was heard in February 2017 and judgment was delivered on the 23rd of June 2017. Following certain events whilst awaiting judgment, the applicant brought an urgent application in this Court seeking an order interdicting the respondents from using the property in contravention of the conditions of title, pending the outcome

of the application in the Gauteng Division, which order was granted unopposed on the 28th of March 2017. The order was then served on the respective respondents on the 31st of March 2017 and 7th April 2017. The respondents launched an application for leave to appeal this order which application for leave to appeal was dismissed

on the 1st of June 2017.

[6] On the 13th of July 2017 the respondents together with their counsel launched an application for leave to appeal the judgment and order granted by the Gauteng Division on the 23rd of June 2017 which application for leave to appeal was dismissed on the 12th of September 2017.

[7] It was submitted by counsel for the applicant that the respondents are in contempt of the Court order of the 28th March 2017 since from the 4th of July 2017 they proceeded to trade in violation of the registered rights of the applicant even after they filed their notice to appeal the judgment of the 23rd June 2017. The respondents have breached and continue to breach the principle of legality and have infringed the trade mark of the applicant in a flagrant manner. The respondents, so the argument goes, confirmed at the meeting held on the 13th of July 2017 that they are appealing the judgment of the Gauteng Division and that they are not intent of doing business with the

applicant as they have had problems with the applicant in the past in other businesses or other sites.

[8] It was contended further by counsel for the applicant that the counter application of the respondents is raising issues which were raised and dealt with in the Gauteng Division judgment. Some of the allegations contained in the answering affidavit fall to be strikeout as they were dealt with in the Gauteng Division judgment. Those issues are therefore res judicata and the respondents’ case should fall on this basis. It is further contended that the new issues now raised in the counter application should have been raised in the Gauteng Division application and the respondents should not be given a second chance to bring the same action against the same party in a piece meal fashion. The respondents chose a particular cause, so it is contended, and must stand and fall by it. Further, as the argument goes, the Court does not have inherent jurisdiction to cancel or remove the restrictive condition which is registered by the Registrar of Deeds in the title deed. It is a real right in favour of the applicant which can only be removed by consent of the applicant or by order of the Court.

[9] Counsel for the applicant contended that the applicant is a multinational company and cannot be said to be unable to perform its reciprocal obligations in terms of the restrictive condition of title. It is the respondents who have refused to negotiate with the applicant. The applicant sold the property to Future Trade at a discounted rate for business purposes – hence the restrictive condition and cannot, as proposed by respondents, be expected to compete with other petroleum companies on this property. The applicant offered the respondents the same supplier or franchise agreement as its other franchises but refused to accept it.

[10] Counsel for the respondents contended that it is clear from the restrictive condition that there was a reciprocal obligation to the applicant to supply the products and the applicant failed to do so. There was no operating agreement between the parties since the offer did not come from the applicant but from Future Phambili. The applicant should have made an offer with full details as to what standards have to be met and for the applicant not to charge more than it is supposed to charge. The offer made by Future Phambili is not a standard offer since it involves Regulatory Accounting Systems (RAS) and the respondents did not know if it is standard in the industry. There is therefore, so it is contended, a dispute that the offer was from the applicant and this dispute can only be resolved at the trial.

[11] It was further contended by counsel for the respondents that they did not appeal the Gauteng Division judgment but it was their counsel who appealed the de bonis propiis costs order against him. If the appeal was noted as though it were the respondents who are appealing, then in that event the attorneys for the respondents acted outside their mandate as they had no instruction to do so. As the argument goes, the Gauteng Division judgment was finalised on the 23rd June 2017 and are therefore not in contempt of the order since they started their operation on the 4th of July 2017.

[12] It has been established that for an applicant to succeed with the contempt of Court proceedings, it must prove the existence of a Court order, that it was served or notice thereof was given, that there was non-compliance with the terms of the order and that there was wilfulness and mala fides beyond reasonable doubt on the part of the respondents in disobeying the order. The respondents bear the onus to rebut the inference that its non-compliance was not wilful and mala fide.

[13] Section 165 of the Constitution of the Republic of South Africa, Act 108 of 1996 provides as follows:

“Judicial Authority

1) The judicial authority of the Republic is vested in the courts.

2) ……………………………

5) An order or decision issued by a court binds all persons to whom and organs of state to which it applies.”

[14] In Matjhabeng Local Municipality v Eskom Holdings Limited and Others ZACC [2017] 35 (CCT217/15) (26 SEPTEMBER 2017) the Constitutional Court stated the following:

“At para 47 Section 165 of the Constitution, indeed, vouchsafes judicial authority. This section must be read with the supremacy clause of the Constitution. It provides that courts are vested with judicial authority, and that no person or organ of state may interfere with the functioning of the courts. The Constitution enjoins organs of state to assist and protect the courts to ensure, among other things, their dignity and effectiveness.

[15] The Court continued in paragraph 48 to state the following:

“To ensure that courts’ authority is effective, section 165(5) makes orders of court binding on ‘all person to whom and organs of state to which it applies’. The purpose of a finding of contempt is to protect the fount of justice by preventing unlawful disdain for judicial authority. Discernibly, continual non-compliance with court orders imperils judicial authority.”

[16] It is not in dispute that there is a Court order dated the 28th March 2017 and that the order was served or notice thereof was given to the respondents. It is further not in dispute that there was non-compliance with the order. The case for the respondents is that they began their business operations on the 4th July 2017 after the Gauteng Division’s judgment of the 23rd of June 2017. As far as the respondents are concerned the order lapsed on the 23rd of June 2017 as they argue that they did not appeal the judgment but only their counsel who appealed against a de bonis propiis cost order against him.

[17] I find this argument to be contrived and disingenuous. It is clear from the judgment of the Gauteng Division dated 12th September 2017 that the respondents together with their counsel, Mr Savvas, applied for leave to appeal. Further, it is on record that the respondents confirmed in correspondents that they are appealing the decision of the Gauteng Division and that they are continuing with their business in disregard of the Court order. The respondents confirmed in a meeting with the applicant that they are launching an appeal against the judgment of 23rd June 2017. On paragraph 3 of the judgment of the 12th September 2017, it is clearly stated that “Both Savvas and the applicants have each filed application for leave to appeal the judgment and orders………..”

[18] In my view, what is discernible from the conduct of the respondents is that they deliberately and intentionally disobeyed the Court order. They were malicious in their conduct – hence their stance that they never appealed the judgment and orders of the 23rd June 2017. They continue to be malicious in that now it is suggested that the attorneys acted without a mandate to launch the appeal on their behalf. However, the respondents have not taken any steps against their attorneys in this regard. The inescapable conclusion is that the respondents have failed to rebut the inference that their conduct of disobeying the Court order of the 28th March 2017 was wilful and malicious and therefore fall to face the sanction for contempt of Court. The Courts have been enjoined in a number of decisions to enforce court orders otherwise the dignity of the Courts may be imperilled by the flagrant disregard of court orders with impunity.

[19] It is trite that once a condition or a servitude is registered either notarial or as a condition of title in the title deed by the Registrar of Deeds, it bestows a real right to the person or entity in whose favour it is registered. Further, it is trite that a real right is absolute in the sense that it prevails against the whole world.

[20] Silberberg and Schoeman in the Law of Property, 5th Edition on page 51 state the following:

“The holder of a servitude such as a right of way in relation to a piece of land is entitled to enforce such servitude, being a limited real right, not only against the original grantor but also, for the duration of the right, against all successors in title and creditors, irrespective of whether they had actual knowledge of the existence of the servitude.”

[21] On page 338, the author continued and defined the personal servitude as:

“a servitude established in favour of particular persons over things and may confer a variety of benefits on their holders. They are real rights; however they cannot be transferred. They may be constituted for a fixed term of years or be granted until the happening of a future event or for the lifetime of the beneficiary, but not beyond his or her death. For this reason, mineral rights, which were in many respects similar to personal servitudes but transferable from one person to another, were generally described as either quasi-servitudes or real rights sui generis. If the usufructuary is a legal person, the usufruct is terminated upon dissolution of the legal person or the lapse of 100 years.”

[22] The Deeds Registries Act, 47 of 1937 as amended provides as follows:

Section 3(1)

The registrar shall, subject to the provisions of this Act -

(a) ………………………….

(o) register any servitude, whether personal or preadial, and record the modification or extinction of any registered servitude;

Section 63

Restriction on registration of rights in immovable property –

(1) No deed, or condition in a deed, purporting to create or embodying any personal right, and no condition which does not restrict the exercise of any right of ownership in respect of immovable property, shall be capable of registration:

Provided that a deed containing such a condition as aforesaid may be registered if, in the opinion of the registrar, such condition is complementary or otherwise ancillary to a registrable condition or right contained or conferred in such deed.

Section 102

Definitions

(1) In this Act, unless inconsistent with the context –

“real right” includes any right which becomes a real right upon registration;

[23] In Exparte Saiga Properties (Pty) Ltd 1997 (4) SA at 716 (ECP) in which Exparte Rovian Trust (Pty) Ltd 1983 (3) SA at 209 was quoted with approval the Court stated the following:

“It has long been settled that the High Court has no inherent jurisdiction to remove, vary or suspend a restrictive condition of title to land. The rationale lies in the nature of a restrictive condition which, in its essence, is a form of contractual stipulation in terms of which a transferor of land regulates the exercise of the transferee’s dominium over the property. The condition of transfer of the land to the successor in title is endorsed upon the deeds and, by reason thereof, restricts the use to which the property may be put by succeeding successors in title. Such condition may also confer rights upon the holders of title to other properties by defining the relationship between portions of land or by conferring upon such other lot holders a right to enforce the restrictive condition applicable to the property in question in this respect such condition are in the nature of servitudes. Given the nature of these conditions of title and the rights that are thereby conferred they cannot be removed, varied or suspended except with the consent of all of the parties whose rights and interests are regulated thereby.”

[24] I am unable to agree with the respondents that there was a reciprocal duty on the applicant flowing from the restrictive condition of title. The condition or servitude, as what it becomes when registered in the Deeds Office, is a personal servitude in favour of the applicant against the property and neither requires nor does it impose any duty to the applicant to do anything. It bestows a real right on the applicant which is enforceable and can only be removed with the consent of the applicant or by order of the Court. It restricts an owner of the property and all its successors or assigns in title in the use of the property.

[25] The Gauteng Division’s judgment found that there was a supply agreement between Chevron and Foreign Trade which allowed for a cession or assignment delegation in Clause 6 thereof which gave Chevron the right to assign its rights and cede and delegate its duties without having to procure any consent from Foreign Trade. I am therefore of the view that, although the offer to the respondents came from Future Phambili, the offer was made by the applicant and it confirmed same in correspondents to the respondents that Future Phambili was mandated by it to make the offer. I therefore disagree with counsel for the respondents that there is a dispute as to whether the applicant made an offer to the respondents which dispute requires the whole matter be referred to trial. The inescapable conclusion is that the respondents refused to entertain the applicant’s offer because of its commitment to X- Fuels – hence the suggestion that the applicant should compete with other players in the industry.

[26] I am in agreement with counsel for the applicant that the issue raised by the respondents that the applicant has repudiated or abandoned the restrictive condition since the property was not being used at the time they bought it was dealt with in the Gauteng

Division’s judgment. There is no merit in the argument that the applicant abandoned or repudiated its rights or the condition in the title. However, for the respondents to succeed with their claim for repudiation or abandonment, it must establish that there was an express intention on the part of the applicant and that it was so communicated to repudiate or abandon its right arising from the servitude. Such intention and communication must be on the same level as an offer and acceptance.

[27] In Meintjies V Coetzer & Others (089/09) [2010] ZASCA 32 (29 March 2010) the Supreme Court of Appeal noted the following:

“The first and second defendants bore the onus to establish that a waiver had occurred. For a waiver to be effectual they had to show that the deceased, with the full knowledge of her right to portions 2 and 3, decided to abandon it, ‘whether expressly or by conduct plainly inconsistent with an intention to enforce it.’ (Laws v Rutherfurd 1924 AD at 263). What happened in this case is plainly inconsistent with that intention. When the deceased made her last will she bequeathed her entire estate to the plaintiff and not the ‘remainder’ thereof. If her intention had been to abandon portions 2 and 3 one would have expected her to state unequivocally that she was giving the plaintiff only portion 1 or at the very least the remainder of her estate.

The first and second defendants bore the onus throughout to prove waiver or abandonment. The mere fact that the property is registered in the name of a person does not translate into ownership. Ownership may be acquired by prescription or by abandonment even if the property is not registered in one's name. For abandonment of property there must be an intention by the owner to abandon the property.”

[28] In Union Free State Mining and Finance Corporation Ltd v Union Free State Gold and Diamond Corporation Ltd 1960 (4) SA 547 (W) at 549C-E the court said the following:

“I do not think that a creditor can by the mere exercise of his will terminate the obligation without the concurrence of the debtor

because as both Wessels and Pothier point out a release, waiver or abandonment is tantamount to making a donation to the debtor of the obligation from which he is to be released and until that donation has been accepted it has not been perfected. There may conceivably be circumstances in which a debtor does not wish to be released from his obligation. It may for a variety of reasons not suit him to be released. To allow the release, waiver or abandonment and the consequent making of a donation dependent solely on the will or action of the creditor would be tantamount to creating a contract at the will of one party which is a concept foreign to our jurisprudence.”

[29] In of Traub v Barclays National Bank Ltd; Kalk v Barclays National Bank Ltd 1983 (3) SA 619 (A), the Court stated the following:

“a creditor’s intention not to enforce a right has no legal effect unless and until there is some expression or manifestation of it which is communicated to the person in whose favour the right is waived or in some way brought to his knowledge, and that any mental resolve not communicated to the other party and only discovered later has no effect.”

[30] The theme that goes through the cases I referred above is that the repudiation and/or abandonment must be clearly communicated by the holder of the right which is not the case in this matter. The onus of proof rested on the respondents throughout that the applicant abandoned its rights to the property. However, I am of the respectful view that the respondents have failed to discharge the onus.

[31] It is trite that for a final interdict to succeed, the applicant must prove that it has a clear right, there must be a threat or reasonable apprehension of harm and there must be no other satisfactory remedy available.

[32] It is common cause that the applicant has a right (servitude) over the property of the respondents and that the respondents have been using the property in a manner which is in violation of the applicant’s right. It is further not in dispute that the respondents sought to interdict the applicant and continue to violet its right until the further trial of this matter. The applicant has been harmed by the respondents’ conduct and will suffer more harm if the respondents were to be allowed to continue in this fashion. I therefore hold the view that the applicant has established that it has a right which right is threatened with harm and that there is no satisfactory remedy available to it except to interdict the respondents from their errant and lawless behaviour.

[33] In the premises, I make the following order:

I. with regard to the contempt of Court application:

a) The first and second respondents are in contempt of the Court order granted on the 29th of March 2017 under above case number;

b) The first and second respondents are to pay a fine in the sum of R100 000 each which fine is suspended for a period of 5 years on condition that they are not found guilty of committing the same offence;

c) Third and fourth respondents are sentenced to 45 days imprisonment which is totally suspended for a period of 5 years on condition that they are not found guilty of committing a similar offence;

d) The first to the fourth respondents are jointly and severally, the one paying the other to be absolved, liable to pay the costs of the application on the scale as between attorney and client;

II. with regard to the interdictory relief:

a) The respondents’ counter application and the application to refer the counter application to trial are dismissed;

b) The first and second respondents are interdicted and restrained, until the 2nd of December 2034 being the balance of the twenty five (25) year period contained in Deed of Transfer No:0038285/2009 from using the property described therein as Erf 1415 Kenmare Township, Registratin Division I.Q., Gauteng and situate at corner Terenure and Carrick Streets, Kenmare in contravention of the conditions of title and for any purpose other than the purpose of carrying on the business of a Caltex Branded Service Station consisting of all or any of the usual business of a garage, filling station and service station for motor vehicles, not excluding any specialised services occasionally offered by such a business, and including:

1. The storage and offering for sale of the applicant’s petrol and petroleum products to the exclusion of all other petrol and petroleum products, save as the applicant may otherwise direct;

2. The display and advertisement of the applicant’s products to the exclusion of all other similar products, save as the applicant may otherwise direct;

3. The installation, operation and maintenance of structures, machines, containers and devices relating to the storage, sale, display and advertisement of the applicant’s products to the exclusion of all other structures, machines, containers and devices serving the same or similar purposes, save as the applicant may otherwise direct.

c) The first and second respondents are interdicted and restrained from using the properties described as Erf 511 and Erf 513 respectively,

Kenmare Township, Registration Division I.Q., Gauteng in contravention of the conditions of title and or the purpose of carrying on the business of a garage petrol filling or service station meaning such business as consists of all or any of the usual business of a garage, filling station and service station for motor vehicles, not excluding any specialised services occasionally offered

by such a business and including the storage and offering for sale of petrol and petroleum products, the installation, operation and maintenance of structures, machines, containers and devices relating to the storage, sale, display and advertisement of petrol petroleum products, except as the applicant may direct.

d) The first and second respondents are interdicted and restrained until the 2nd of December 2034 being the balance of the twenty five (25) year period contained in the Deed o Transfer number 0038285/2009 from

establishing and/or conducting the business of an X-Fuels branded service station and/or any other service station which is not a Caltex Branded Service Station at the property.

e) The first to the fourth respondents are liable to pay the costs of these applications jointly and severally the one paying the other to be absolved, on the scale as between attorney and client including costs occasioned by the employment of two counsel.

_________________

TWALA M L

JUDGE OF THE HIGH COURT OF SOUTH AFRICA

GAUTENG LOCAL DIVISION

Date of hearing: 13th February 2019

Date of Judgment: 14th March 2019

For the Applicant: Adv. AG Sawma SC

DL Williams

Instructed by: Wright Rose-Innes Inc.

Tel: 011 646 9910

For the Respondents: Adv. HB Marais SC

AJR Booysen

Instructed by: De Kooker Attorneys

Tel: 011 025 5956