Sanbonani Holiday Spar Shareblock Limited v Visser NO and Another (34205/2006) [2008] ZAGPHC 299 (1 February 2008)

IN THE HIGH COURT OF SOUTH AFRICA

(TRANSVAAL PROVINCIAL DIVISION)

Case No: 34205/2006

Date: 01/02/2008

UNREPORTABLE

In the matter between:

SANBONANI HOLIDAY SPAR

SHARE BLOCK LIMITED Plaintiff/Applicant

And

MR ANDRE STEPHANUS VISSER N.O. 1st Defendant/1st Excipient

MRS MARNENE SUNE VISSER N.O. 2nd Defendant/2nd Excipient

JUDGMENT

LEDWABA, J

[1] The defendants filed an exception to part of the plaintiff's particulars of claim. They allege that the particulars of claim lack sufficient averments to sustain the action or that the particulars of claim do not disclose a cause of action.

[2] The exception is directed at self-contained portions of the particulars of claim, namely, paragraphs 12, 13, 14 and 15.

[3] When the matter was argued, the defendants' (excipients), legal representative argued that the exception be upheld with costs. On the other hand, the plaintiff's legal representative opposed the exception application.

[4] The following are material averments in the plaintiff's particulars of claim:­ -

(i) The plaintiff is a registered share block company with limited liability. The first and second defendants are cited in their capacities as duly appointed trustees of EBC Trust (the trust). [For convenience sake I hereinafter refer to the defendants as the trust].

(ii) The trust is a shareholder in the plaintiff's company. (see: annexure A page 15 of the paginated record. As a shareholder the trust is bound by the terms of the Articles of Association of the plaintiff.

(iii) Ownership of the shares in the plaintiff's company entitled the trust to the use of Chalet number 41B, in the Sanbonani Holiday Spar complex, and the use thereof was governed, inter alia, by sub-article 3.5.

(iv) Since December 1997 but certainly during the period to which the plaintiff's claim relates, the trust has permitted the chalet to be used for time-sharing residential purposes as contemplated in sub-article 31.1

(v) The trust is therefore obliged in terms of sub-article 31.1.2 to contribute to both the time-sharing and common levies in terms of article 28 (both of which are referred to, inter alia, in paragraphs 28.3.1 and 28.3.2 of article 28).

(vi) The first special levy in accordance with paragraph 16.3.1 (of the particulars of claim) amounts to R25 500.

(vii) The second special levy in accordance with 16.4.1 (of the particulars of claim) amounts to R102 000.

(viii) Time-share levies for the year 2006 amounts to R118 678, 53; and;

(ix) Time-share levies 2007 amounts to R 128 520.

[5] Sub-article 31.1 of the articles provides that a holder of a share-block which confers a time-sharing interest shall inter alia, be obliged to contribute to both the time sharing and common levies. According to sub-article 28.3.1, time-sharing levies are borne

exclusively by the holders of the share­ blocks conferring a time-sharing interest, whereas according to sub-article 28.3.2, the common levies are borne by all holders of all share-blocks.

[6] The grounds on which the trust excepts to plaintiff's particulars of claim are that:­

(i) There is no indication in the particulars of claim whether or not the share-block owned by the trust gave the trust a time-sharing interest or some other interest;

(ii) There is no provision in the articles which states that the fact that the party allows the chalet to be used for time-sharing purposes will make it liable to pay the time-sharing levies; and

(iii) The shares owned by a party vest in that party a particular right of use either a time-sharing interest or some other interest. The amount of levies payable by the owner of the shares is dependent on the nature of the right acquired, not the purpose for which the owner uses the chalet.

[7] The main contention advanced by the trust is that the particulars of claim are silent on the question whether the time-sharing interest has or had not been conferred on the share-block owned by the trust. This particular contention is the common thread that runs through the three grounds of the exception set out herein above.

[8] It was further contended in argument on behalf of the trust that where the claim is based on a contract, the plaintiff must allege the terms of the contract on which that claim is based. In this regard the trust's legal representative referred to sub­ article 3.5 and argued that there was no indication whether the Share Block Developer had exercised its discretion by way of conferring the time-share interest to the shares held by the trust. I shall deal with the provisions of sub-article 3.5 later hereunder.

[9] It is trite that the excipient has a duty to persuade the court that upon every interpretation which the particulars of claim can

reasonably bear, no cause of action is disclosed, see Theunissen v Transvaalse lewendehawe koop Bpk, 1988 (2) SA 493 A at 500D, which was also cited in Francis v Sharp and Others 2004 (3) SA 230 at 237 G].

[10] Plaintiff's legal representative submitted that the particulars of claim do make out a case against the trust, further argued that it did not need a stretch of imagination to come up with a possible construction to the effect that the developer had conferred a time-sharing interest on the trust.

[11] Sub-article 3.5 is central to the issue to be decided. Paragraph 5 of the particulars of claim avers that the use of chalet no 41 B in Sanbonani Holiday Spa Complex by the trust was governed, inter alia, by sub article 3.5. Importantly, paragraph 5 of the particulars of claim should be read together with paragraphs 6 and 7 of the particulars of claim, if it is to bear a clear meaning. Sub-article 3.5 read as follows:

'The shares comprising the share blocks 09 (naught nine) SBSP ...41 (forty one) ... SBSP inclusive..., ..., ...,confer on the Share Block Developer such interest as the Share Block Developer may from time to time, decide, including without limitation a timesharing interest in such form as the Share Block Developer in its discretion may decide or any other interest, including a permanent continuous right of use for permanent residential or commercial purposes, of such portion of the land upon which the sites are situated and marked. .. S 41...

In this regard the Share Block Developer has the discretion to consolidate the sites and to deal with individual sites or consolidate sites in the manner aforesaid, including the right to sub-divide a particular share block into as many shares as the Share Block Developer so decides in order to confer upon the holders of such sub divided shares a time sharing interest in the relevant site or sites...'

[12] It appears from the provisions of sub-article 3.5 that a Share Block Developer may sub-divide a particular share block in order to confer upon the holders of such sub-divided shares time-sharing interest on the relevant site or sites.

[13] The trust's legal representative raised the question as to whether or not the Share Block developer had exercised its discretion in the same manner. In my view, this question is a matter for evidence and therefore a matter beyond the scope of this exercise. I refer in this regard to Mckenzie v Farmers Co-operative Meat Industries Ltd 1922 AD 16 at 23, where the Appellate Division per Maasdorp JA, in adopting the definition of 'cause of action' said the following:

'LORD ESHER, M. R said: 'What is the real meaning of the phrase 'cause of action vesting in a city'? It has been defined in Cook v Gill, (L.R., 8 C.P. 107), to be this: 'every fact which it would be necessary for the plaintiff to prove, if traversed, in order to support his right to

the judgment of the Court'. It does not comprise every piece of evidence which is necessary to prove each fact but every fact which is necessary to be proved. It has been suggested to-day in argument that this definition is too broad, but I cannot assent to this, and I think the definition is right.'

[10] In my respectful view, the particulars of claim do disclose a cause of action. One possible construction that the particulars of claim can reasonably bear is, as was correctly contended by counsel for the plaintiff, that the Share Block Developer had conferred a time-sharing interest on the trust's shares. The question whether or not indeed the developer had conferred a time-sharing interest on the trust's shares is a matter for evidence and therefore only fit for trial.

[11] It is therefore my finding that the excipients failed to make out a case for exception. Regarding costs I do not think that the matter warranted the employment of two counsel.

[12] On the foregoing, I dismiss the exception with costs.

A P LEDWABA

JUDGE OF THE HIGH COURT