Guba v Odendaal and Another (5155/05) [2006] ZAGPHC 89 (6 September 2006)

SG

IN THE HIGH COURT OF SOUTH AFRICA

(TRANSVAAL PROVINCIAL DIVISION)

DATE: 6 SEPTEMBER 2006

CASE NO: 5155/2005

UNREPORTABLE

In the matter between:

RENIER

JOHANNES GUBA APPLICANT

And

ADRIAAN ISAK ODENDAAL 1ST

RESPONDENT

MARTHA PETRONELLA GUBA 2ND

RESPONDENT

JUDGMENT

PATEL, J

[1] The applicant seeks a declaratory order that the agreement of sale between the applicant and the first respondent relating to a portion of land is void and that the first respondent must vacate from the property as well as costs of the application. The first respondent counter applies for specific performance of the agreement of sale and costs of the counter application.

[2] It is not in dispute that the agreement of sale concluded between the applicant and the first respondent did not comply with the provisions of the Subdivision of Agricultural Land Act 70 of 1970

[3] The issue is, is the agreement of sale void since there was non – compliance with the statutory provisions. If the answer is in the affirmative, then the question is can the agreement be revived by the parties subsequent to the granting of the premission.

[4] The agreement was signed on 21 December 1996, and the requisite statutory permission was granted by the Minister of Agriculture on 26 June 1998.

[5] Mr Wagner for the first respondent contended that the applicant was bound by the terms of the agreement because, after the ministerial permission was granted on 26 June 1998, the parties conducted themselves in a manner that gave rise to the inescapable inference that both of them desired the revival of their former contractual relationship on the same terms as existed before. Hence, it was submitted that the agreement was revived and not void for want of ministerial permission and in the premises the applicant’s application should be dismissed.

[6] In counter application, the first respondent requests this Court to gives effect to the agreement as revived by the parties, concomitantly he seeks specific performance of the agreement.

[7] It is common cause that the deed of sale dated 21 December 1996 was void ab initio since there was non-compliance with section 3(e)(i) of the provisions Subdivision of Agricultural Land Act. For present purposes the pertinent of section 3(e)(i) provides:.

“[N]o portion of agriculture land, whether surveyed or not, and whether there is any building thereon or not, shall be sold ...unless the minister has consented in writing.”

The definition of “sale” in section 1 reads:

“sale” includes a sale subject to a susceptive condition; and “sold” shall have a corresponding meaning.”

[8] In Geue v Van der Lith [2003] ZASCA 118; 2004 3 SA 333 (SCA). Brand JA, at 342G-343H said:

“[12] Significantly, in all the cases referred to the suppressive condition related to the very requirement prescribed by the legislative enactments concerned. In all the cases the eventuality of the contract coming into operation was made subject either to the Minister’s consent becoming unnecessary or the proclamation of the township, as the case may be. Upon reflection, this is not fortuitous. The reason why the suspensive condition could not relate to any other the one required by the statutory provision involved was succinctly formulated as follows by Watermeyer CJ in Corondimas (at 551-2)

“The position which would arise, if the suspensive condition does not relate to the consent of the Minister and no consent is given, is not raised in the present case, but in that event a contract of sale would come into existence if the condition is fulfilled, and, if the conditions is fulfilled, the contract which comes into existence must necessarily be an illegal contract because the Minister has not consented to it. Consequently, It would seem that a sale subject solely to a suspensive condition of any other sort would necessarily be null and void.’

(see also Feetham AJA at 559-60) The same considerations were reformulated somewhat differently by Trollip JA in Soja(Pty) Ltd v Tuckers Land & Development Corporation (Pty) Ltd(Supa) at 322A), when he said:

‘(I should explain here that we are only concerned with this limited particular kind of suspensive condition- the due proclamation or approval of the township. If the suspensive condition was of some kind it would seem that the agreement would be invalidated by the prohibition in section 57 A for that condition may be fulfilled and the agreement perfected before due proclamation…).

[13] The reasoning that emerges from these statements seems to provide the answer to the theory proposed by the Court a quo as to why the Legislature found it necessary to introduce the extended definition of a sale by way of the 1981 amendment. It will be remembered that, according to the theory advanced by the Court a qua, the amendment was necessary to close the loophole of a suspensive condition being used as a mechanism to avoid the requirement of the Minister’s consent. Since, in accordance with Corondimas, as agreement subject to a suspensive condition is not a sale, so the Court a qua reasoned, the parties to an agreement of sale of undivided agricultural land could, but for the amendment, have circumvented the Minister’s consent by making their agreement subject to some other suspensive condition unrelated to the Minister’s consent being obtained. From the dicta of Watermeyer CJ and Trollip JA quoted above, it is plain, however, that any attempt to avoid the Minister’s consent in this manner would be doomed to failure. The moment the suspensive condition is fulfilled, it becomes a ‘sale’ for which the Minister’s consent is required. Consequently, such an agreement can never become enforceable without the Minister’s consent. If the purpose of the legislative amendment was therefore to prevent this type of ‘circumvention’, the amendment would be an exercise in futility.

Furthermore, If I accept, as I do, that the Legislature must also be assumed to have been aware of explanations such as those given in Corondimas and Soja as to why the Minister’s consent cannot be avoided through the imposition of a suspensive condition. On this assumption the Legislature would therefore have been aware that the concern attributed to it by the Court a qua would be unfounded.”

[9] The first respondent further contended that a new written agreement was concluded by the parties through their attorneys. The first respondent relied on certain documents, namely a written offer and a written acceptance of the offer. However, the applicant contended, that no agreement, whether orally or in writing, was reached in or about December 1998. He made it clear at an early stage that he was not interested in continuing with the sale and the guarantee delivered under the invalid agreement was already returned in January 1998 to the respondent. The problem was further compounded since there was a registered usufruct of the applicant’s mother the second respondent. She did not consent to the sale. The first respondent did not want to purchase property subject to the usufruct. Although the applicant signed the transfer documents pertaining to the 1996 agreement but his mother refused permission to cancel the usufruct.

[10] Thereafter, the parties endeavoured to settle the matter when the applicant made an offer of R20 000.00 additional to the contract price. However, the respondent in a letter of 30 March 2006 made a counter offer and wherein it was suggested that the parties were willing to continue with the sale. The applicant rejected the counter offer on 11 April 2000.and also rejected the contimation of the sale.

[11] Then, on 13 April 2000, the applicant threatened to cancel the “agreement”, but the respondent still hoped for a settlement. By this time, the applicant was no longer interested and tendered, as he was obliged to do, payment of the respondent’s damages in the amount of R6 000.00, that is the costs of the subdivision. On 11 September 2000, the first respondent rejected the applicant’s offer with the request that the offer be reconsidered. But this was rejected. Thus, it is indicative that there was no valid, new or revived, agreement between the parties. Consequently, the applicant gave written notice to the respondent to vacate the property on 12 February 2001.

[12] During argument Mr Wagner submitted that this Court should have regard to the conduct of the parties to determine whether, after the approval of the sub division of the property, the parties entered into an agreement relating to the sale of the proper. In support of this submission counsel relied on the following passage by Wessels JA in South African Railways and Harbours v National Bank of South Africa Ltd 1924 AD 704, at 715 to 716;

“The law does not concern itself with the working of the minds of parties to a contract, but with the external manifestation of their minds. Even therefore if from a philosophical standpoint the minds of the parties do not meet, yet, if by their acts their minds seem to have met, the law will, where fraud is not allege, look to their acts and assume that their minds did meet and that they contracted in accordance with what the parties purport to accept as a record of their agreement. This is the only practical way in which courts of law can determine the terms of a contract.”

[13] Further, Mr Wagner also submitted that such an agreement can lawfully be concluded and in support of this submission he relied on the following passage in Golden Fried Chicken (Pty) Ltd v Sirad Fast Foods CC 2002 1 SA 822 (SCA), at 825C/D-E:

“After the termination of the initial agreement ... the parties (in the light of the facts recited) conducted themselves in a manner that gave rise to the inescapable inference that both desired the revival of their former contractual relationship on the same terms as existed before. Taken together, those facts establish a tacit relocation of a franchise agreement (comparable to a tacit relocation of lease) between the appellant and Sirad (Shell South African (Pty) Ltd v Bezuidenhout and Others 1978 (3) SA 981(N) at 984B-E) A tacit relocation of an agreement is a new agreement and not a contimation of the old agreement(Fiat SA v Kolbe Motors 1975(2) SA 129 (o) at 139 D-E; Shell at 985B-C)”

[14] Mr Wagner futher submitted that the first respondent relied upon express relocation. After that the approval of the subdivision on 26 June 1998, there was consensus ad idem which can be sought from the documents and both desired the revival of their former contractual relationship on the same terms as existed before. Counsel submitted that once that is established then the initial sale agreement, together with the documents concerned, would constitute the sale agreement, since an agreement relating to the sale of land may be contained in more than one document. Further, these passages referred by Mr Wagner do not support the first applicant’s case because in those matters the issue was not related to sale of land.

[15] Mr Havenga for the applicant submitted that it is now more than five years later and the first respondent has not insisted on transfer prior the launching of the counter application, and he has not vacated the premises. His right to demand transfer has prescribed.

[16] In the final analysis Geue’s case supra is of importance because even a contract with a suspensive condition, that it is subject to the consent of the minister being obtained, is invalid.

In Kourie v Bean 1949(2)SA 567(T), at 572 Lucas AJ said:

“If the decision is correct the deed which was signed did not in fact comply with the provisions of the law, it was a nullity, as was pointed out by Innes, JA in Wilken v Kohler (1913, AD 135 at page 141). Being a nullity, it could not be rectified so as to become a valid contract. Nor does the fact that defendant was allowed to occupy the property help to identify it for purposes of validating the deed of sale. As was said by Innes, JA in Wilken’s case at page 143: “This agreement being of no force and effect in law, cannot it seems to me be validated by reason of the fact that it had been partly carried through .”

The effect of this is that the invalid agreement does not revive or assume validity after the minister has granted his consent even if the parties wish to give effect to that invalid agreement.

[17] Further, it is not impossible to revive an agreement of sale in respect of immovable property, because section 2(1) of Alienation of Land Act, 68 of 1981

(1) No alienation of land after the commencement of this section shall, subject to the provisions of section 28, be of any force or effect unless it is contained in a deed of alienation signed by the parties thereto or by their agents acting on their written authority.”

Van den Heever J in Day v Charlet Properties (Pty) Ltd 1986 (2) SA 391 (CC) at 394 B/C-D stated:

“ The wording of section of Act 2(1) of Act 68 of 1981 is not precisely the same as that of its predecessor’s 1 of Act 71 of 1969; but their aim is the same and cases decided under the former statute are course still apposite today. The writing is, in general, the exclusive memorial of the transaction relating to the land and no evidence to prove its terms may be given other than the document, “nor may the contents of such document be contradicted, altered, added to or varied by parol evidence”(Union Government v Vianini Ferro-Concrete Pipes(Pty)Ltd 1941 AD 43 at 47.)”

[18] In conclusion, this court finds that the agreement of sale entered into between the parties was invalid and of no force and effect in law since there was non-compliance with section 3(e)(i) of Act 70 of 1970 and the subsequent ministerial consent did not revive the agreement nor a new agreement came into existence between the parties by their conduct.

[19] The remaining issue is costs. The applicant launched this present application in February 2005. The first respondent entered an appearance to defend on 1 March 2005 but failed to file an answering affidavit. The matter was enrolled on the opposed roll but removed when first respondent filed his answering affidavit and counter application on 26 September 2005. The costs for 21 October 2005 was reserved. The applicant is entitled to those wasted costs as well as the costs of these proceedings.

Order

[20] In the result the following order is made:

[20.1] The relief sought by the applicant in prayers 1,2 and 3 of the notice of motion and the first respondent is ordered to pay the reserved costs of 21 October 2005.

[20.2] The first respondent counter application is dismissed with costs.

E M PATEL

JUDGE OF THE HIGH COURT

5155/2005

HEARD ON: 10 AUGUST 2006

FOR THE APPLICANT: ADV HAVENGA

INSTRUCTED BY: MESSRS LOURENS ATTORNEYS

FOR THE RESPONDENTS: ADV KLOPPER

INSTRUCTED BY: MESSRS CORRIE KRAAMWINKEL ATTORNEYS.

DATE OF JUDGMENT: 6 SEPTEMBER 2006

: