Mokone v Tassos Properties CC and Another (CCT113/16, CCT291/16) [2017] ZACC 25; 2017 (10) BCLR 1261 (CC); 2017 (5) SA 456 (CC) (24 July 2017)

Mokone v Tassos Properties CC and Another (CCT113/16, CCT291/16) [2017] ZACC 25; 2017 (10) BCLR 1261 (CC); 2017 (5) SA 456 (CC) (24 July 2017)

The Constitutional Court held that, when parties extend a lease without further stipulation, the extension generally encompasses all terms contained in the lease document, including collateral terms such as a right of pre-emption. The Court rejected the categorical common law rule that only terms incident to the...

Source-derived case information.

Citation
[2017] ZACC 25
Parties
Applicant: Ntswaki Joyce Mokone; Respondent: Tassos Properties CC; Respondent: Blue Canyon Properties 125 CC
Court
Constitutional Court
Jurisdiction
South Africa
Judgment Date
24 July 2017
Case Number
CCT113/16, CCT291/16
Procedural Posture
Leave to Appeal / Appeal From High Court and Supreme Court of Appeal; Constitutional Court Judgment
Outcome
Leave to appeal granted; appeals upheld; High Court orders set aside; extension of lease included right of pre-emption; action remitted to High Court; eviction proceedings stayed pending finalisation of action.
Judges
Nkabinde, Froneman, Jafta, Khampepe, Madlanga, Mhlantla, Mojapelo, Pretorius, Zondo
Legal Topics
Right of Pre Emption, Lease Extension, Alienation of Land Act, Contract Interpretation, Stay of Proceedings, Specific Performance
Land and Property Civil Procedure Commercial and Corporate Right of Pre Emption Lease Extension Alienation of Land Act Contract Interpretation Stay of Proceedings +1 more

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Parties

Ntswaki Joyce Mokone

Applicant

Tassos Properties CC

Respondent

Blue Canyon Properties 125 CC

Respondent

Procedural Posture

Leave to Appeal / Appeal From High Court and Supreme Court of Appeal; Constitutional Court Judgment

Legal Issues

  1. 1 Whether the extension of a lease simpliciter renews only terms incident to the lessor-tenant relationship or also collateral terms such as a right of pre-emption.
  2. 2 Whether a right of pre-emption granted orally or in writing without signature is invalid under section 2(1) of the Alienation of Land Act.
  3. 3 Under what circumstances a court may stay proceedings pending finalisation of other proceedings.

Ratio Decidendi

The Constitutional Court held that, when parties extend a lease without further stipulation, the extension generally encompasses all terms contained in the lease document, including collateral terms such as a right of pre-emption. The Court rejected the categorical common law rule that only terms incident to the lessor-tenant relationship are renewed, finding that such a rule imposes a lawyerly understanding on laypersons and is not justified. The Court further held that a right of pre-emption does not constitute an alienation of land and does not require compliance with section 2(1) of the Alienation of Land Act at the time of grant; the formalities apply only when the right is exercised...

Court Disposition

Leave to appeal granted; appeals upheld; High Court orders set aside; extension of lease included right of pre-emption; action remitted to High Court; eviction proceedings stayed pending finalisation of action.

Orders

  • Leave to appeal is granted in both applications.
  • Both appeals are upheld.