Mignoel Properties (Pty) Ltd. v Kneebone (219/88) [1989] ZASCA 110 (22 September 1989)

Mignoel Properties (Pty) Ltd. v Kneebone (219/88) [1989] ZASCA 110 (22 September 1989)

The Supreme Court of Appeal held that the effect of the 'huur gaat voor koop' rule is to substitute the purchaser as lessor in place of the seller, and that this substitution occurs ex lege, without the need for a formal cession or assignment of rights. Consequently, the purchaser acquires all rights which the seller enjoyed as lessor under the lease, including the right to claim against a surety for the lessee's obligations. The Court distinguished the present case from Pizani, noting that while Pizani involved an express cession, the principle applies equally where the substitution arises by operation of law. The Court rejected the respondent's argument that the rule does not extend to...

Citation
[1989] ZASCA 110
Parties
Appellant: Mignoel Properties (Pty) Ltd; Respondent: David Roderick Kneebone
Court
Supreme Court of Appeal
Jurisdiction
South Africa
Judgment Date
22 September 1989
Case Number
219/88
Procedural Posture
Civil Appeal / Appeal From the Witwatersrand Local Division After Leave to Appeal Was Granted by Petition to the Chief Justice.
Outcome
Appeal upheld. The order of the Court a quo is set aside and replaced with an order dismissing the appeal with costs, and waiving the limitation in Rule 69(3) regarding counsel's fees.
Judges
Joubert, Botha, Nestadt, Steyn, Friedman
Legal Topics
Huur Gaat Voor Koop, Suretyship Liability, Cession of Rights, Lease Transfer, Magistrates Court Appeal
Land and Property Civil Procedure Huur Gaat Voor Koop Suretyship Liability Cession of Rights Lease Transfer Magistrates Court Appeal

Case Brief

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Parties

Mignoel Properties (Pty) Ltd

Appellant

David Roderick Kneebone

Respondent

Procedural Posture

Civil Appeal / Appeal From the Witwatersrand Local Division After Leave to Appeal Was Granted by Petition to the Chief Justice.

Legal Issues

  1. 1 Does the purchaser of leased property acquire the right to claim against a surety for the lessee's obligations under the lease without a formal cession?
  2. 2 Is a formal cession of rights necessary for the purchaser to enforce the suretyship?
  3. 3 What is the effect of the 'huur gaat voor koop' rule on the rights and obligations of the purchaser, seller, lessee, and surety?

Ratio Decidendi

The Supreme Court of Appeal held that the effect of the 'huur gaat voor koop' rule is to substitute the purchaser as lessor in place of the seller, and that this substitution occurs ex lege, without the need for a formal cession or assignment of rights. Consequently, the purchaser acquires all rights which the seller enjoyed as lessor under the lease, including the right to claim against a surety for the lessee's obligations. The Court distinguished the present case from Pizani, noting that while Pizani involved an express cession, the principle applies equally where the substitution arises by operation of law. The Court rejected the respondent's argument that the rule does not extend to...

Court Disposition

Appeal upheld. The order of the Court a quo is set aside and replaced with an order dismissing the appeal with costs, and waiving the limitation in Rule 69(3) regarding counsel's fees.

Orders

  • The appeal is upheld with costs.
  • The order of the Court a quo is set aside and substituted with: 'The appeal is dismissed with costs. The limitation in Rule 69(3) regarding counsel's fees shall not apply.'