Janse van Rensburg v Shire Properties CC (2413/09) [2010] ZAECPEHC 7 (4 March 2010)

Janse van Rensburg v Shire Properties CC (2413/09) [2010] ZAECPEHC 7 (4 March 2010)

The court found that the contract was silent on the liability for value added tax in respect of the re-transfer of the three subdivided erven to the applicant. Applying common law principles, the court held that the party obliged to effect delivery—in this case, the respondent—must bear the costs necessary to fulfil its contractual obligation, including payment of VAT. The respondent undertook to pay the remainder of the purchase price by transferring three immovable properties to the applicant, and must do so irrespective of the cost. Therefore, the respondent is liable for the VAT levied by SARS on the transfer of the erven to the applicant.

Citation
[2010] ZAECPEHC 7
Parties
Applicant: George Janse van Rensburg; Respondent: Shire Properties CC
Court
Eastern Cape High Court, Port Elizabeth
Jurisdiction
South Africa
Judgment Date
4 March 2010
Case Number
2413/09
Procedural Posture
Civil Application / Judgment
Outcome
Application granted in favour of the applicant.
Judges
Eksteen
Legal Topics
Transfer of Immovable Property, Value Added Tax Liability, Contractual Interpretation
Land and Property Civil Procedure Transfer of Immovable Property Value Added Tax Liability Contractual Interpretation

Case Brief

Summary, issues, holding and outcome

More case intelligence is available

Unlock the full research layer for this judgment.

Full judgment text Downloadable case file Legal principles 3 Authorities cited 4 Party arguments 2 Amounts and remedies 4
Sign in to unlock

Parties

George Janse van Rensburg

Applicant

Shire Properties CC

Respondent

Procedural Posture

Civil Application / Judgment

Legal Issues

  1. 1 Who is liable for the payment of value added tax on the transfer of the three subdivided erven to the applicant.
  2. 2 Does the contract expressly or impliedly allocate liability for value added tax in respect of the re-transfer of the erven.
  3. 3 What is the effect of the common law on the allocation of transfer-related expenses when the contract is silent.

Ratio Decidendi

The court found that the contract was silent on the liability for value added tax in respect of the re-transfer of the three subdivided erven to the applicant. Applying common law principles, the court held that the party obliged to effect delivery—in this case, the respondent—must bear the costs necessary to fulfil its contractual obligation, including payment of VAT. The respondent undertook to pay the remainder of the purchase price by transferring three immovable properties to the applicant, and must do so irrespective of the cost. Therefore, the respondent is liable for the VAT levied by SARS on the transfer of the erven to the applicant.

Court Disposition

Application granted in favour of the applicant.

Orders

  • The respondent is ordered to appoint a conveyancer to register transfer of erven 4057, 4028 and 4071, Lorraine in the Nelson Mandela Metropolitan Municipality, Division of Port Elizabeth, Eastern Cape Province, in the name of the applicant within ten days of this order.
  • The respondent is ordered to provide the conveyancer with all required information and to sign all necessary documents within ten days of being called upon to do so.