Bester NO and Others v Schmidt Bou Ontwikkelings CC

• Jurisdiction: South Africa
• Citation: 2013 (1) SA 125 (SCA)

Bester NO and Others v Schmidt Bou Ontwikkelings CC
2013 (1) SA 125 (SCA)

2013 (1) SA p125

Citation	2013 (1) SA 125 (SCA)
Case No	696/2011; [2012] ZASCA 125
Court	Supreme Court of Appeal
Judge	Brand JA, Snyders JA, Leach JA, Theron JA and Wallis JA
Heard	August 28, 2012
Judgment	September 21, 2012
Counsel	A le Grange SC for the first to fourth appellants.; F Sievers for the fifth appellant.; JA Newdigate SC for the respondent.

Flynote : Sleutelwoorde B

Prescription — Extinctive prescription — Debt — What constitutes — Not including claim for rectification of deed of transfer — Accordingly, such claim cannot be extinguished by prescription — Prescription Act 68 of 1969, s 10.

Vindication — Land — What constitutes — Rectification of deed of transfer — Not C altering rights and obligations of parties — Claim for rectification not amounting to claim for delivery of property in form of rei vindicatio.

Headnote : Kopnota

Where a deed of transfer of immovable property (registered in a deeds registry) D does not reflect the real agreement between the seller and the purchaser of the property, there is no difference between rectification of a contract, on the one hand, and rectification of the deed of transfer, on the other. Rectification of the deed of transfer does not alter the rights and obligations of the parties to the deed of transfer: it merely serves to correct the deed of transfer and is a declaration of what the parties to the deed of transfer to be E rectified had agreed to in the real agreement giving rise to the deed of transfer. Therefore, a claim for rectification of a deed of transfer does not constitute a claim for delivery of property in the form of a rei vindicatio nor does it rely on any obligation by the transferee to do, or to refrain from doing, anything. As in the case of rectification of a contract, it therefore has no correlative 'debt', as contemplated by s 10 of the Prescription Act 68 of 1969, which could be extinguished by prescription. (Paragraphs [10] and F [12] at 130B – C and 130I – J, summarised.)

Cases Considered

Annotations:

Case law

Barnett and Others v Minister of Land Affairs and Others 2007 (6) SA 313 (SCA) (2007 (11) BCLR 1214): G doubted

Boundary Financing Ltd v Protea Property Holdings (Pty) Ltd 2009 (3) SA 447 (SCA): dictum in para [13] applied

Desai NO v Desai and Others 1996 (1) SA 141 (A): dictum at 146H – J applied

Duet and Magnum Financial Services CC (In Liquidation) v Koster 2010 (4) SA 499 (SCA): H dictum in para [24] discussed and distinguished

Fourway Haulage SA (Pty) Ltd v SA National Roads Agency Ltd 2009 (2) SA 150 (SCA): referred to

Gaffoor and Another NNO v Vangates Investments (Pty) Ltd and Others 2012 (4) SA 281 (SCA): dictum in paras [35] – [36] compared

Grobler v Oosthuizen 2009 (5) SA 500 (SCA): dictum in para [18] doubted I

International Shipping Co (Pty) Ltd v Bentley 1990 (1) SA 680 (A): dictum at 700F – G applied

Legator McKenna Inc and Another v Shea and Others 2010 (1) SA 35 (SCA): dictum in para [22] applied

Leketi v Tladi NO [2010] 3 All SA 519 (SCA): dicta in paras [8] and [21] doubted J

2013 (1) SA p126

Oertel en Andere NNO v Direkteur van Plaaslike Bestuur en Andere 1983 (1) SA 354 (A): dictum at 370B applied A

Oriental Products (Pty) Ltd v Pegma 178 Investments Trading CC and Others 2011 (2) SA 508 (SCA): dictum in para [19] applied

Smit v Abrahams 1994 (4) SA 1 (A): referred to

Staegemann v Langenhoven and Others 2011 (5) SA 648 (WCC): considered B

Standard Chartered Bank of Canada v Nedperm Bank Ltd 1994 (4) SA 747 (A): referred to

Stellenbosch Farmers' Winery Ltd v Vlachos t/a The Liquor Den 2001 (3) SA 597 (SCA): considered

Union Government v Vianini Ferro-Concrete Pipes (Pty) Ltd 1941 AD 43: dictum at 49 applied

Weinerlein v Goch Buildings Ltd 1925 AD 282: dictum at 293 applied. C

Statutes Considered

Statutes

The Prescription Act 68 of 1969, s 10: see Juta's Statutes of South Africa 2011/12 vol 1 at 2-914.

Case Information

D Appeal from a decision in the Western Cape High Court, Cape Town (Louw J).

A le Grange SC for the first to fourth appellants.

F Sievers for the fifth appellant.

JA Newdigate SC for the respondent.

Cur adv vult. E

Postea (September 21).

Order

F Both appeals are dismissed. The first, second, third and fourth appellants, in their capacity as liquidators, and the fifth appellant, are ordered, jointly and severally, to pay the respondent's costs of appeal.

Judgment

Brand JA (Snyders JA, Leach JA, Theron JA and Wallis JA G concurring):

[1] The first four appellants are cited in their capacities as the liquidators (the liquidators) of a company, Innova Holdings (Pty) Ltd t/a Procon (in liquidation) (Innova). The fifth appellant is Absa Bank Ltd (Absa). The H respondent is Schmidt Bou Onwikkelings CC (Schmidt Bou). Proceedings commenced with an application by Schmidt Bou against the appellants in the Western Cape High Court, Cape Town. In broad outline it sought an order consisting of four distinct elements, namely: (a) a declarator that it is the owner of an immovable property situated in Sedgefield, which is at present registered in the deeds registry, Cape Town, I in the name of Innova; (b) rectification of the deed of transfer pertaining to that property so as to reflect the true owner of the property as Schmidt Bou instead of Innova; (c) cancellation of a bond registered over the property in favour of Absa as security for its claims against Innova; (d) authorising and directing the Registrar of Deeds, Cape Town, to give effect to the orders in the previous paragraphs. The J registrar, who was cited as the sixth respondent in the court a quo, abided

2013 (1) SA p127

Brand JA (Snyders JA, Leach JA, Theron JA and Wallis JA concurring)

the decision of the court, but the application was opposed by the A liquidators and Absa. When the matter came before Louw J, he granted the application, in the exact terms sought, with costs. The appeals against that judgment by both Innova and Absa, are with the leave of the court a quo.

[2] The background facts are for the most part not in dispute. Historically, B Schmidt Bou was the registered owner of a property known as erf 3117, Sedgefield, being 1,9795 hectares in extent, which was referred to on the papers as 'the mother erf'. On 2 October 2003 Schmidt Bou sold a portion of the mother erf, approximately 1,4 hectares in extent, to Innova for R1,1 million. The deed of sale contained a suspensive C condition requiring subdivision and registration of a separate title for that portion.

[3] In due course the subdivision was granted and, in accordance with the diagrams approved by the Surveyor-General on 31 January 2005, the D mother erf was divided into two portions. The one was named 'erf 4675, a portion of erf 3117, Sedgefield, being 1,3965 hectares in extent' (the portion), while the other was described as 'the remainder of erf 3117 Sedgefield, being 0,583 hectares in extent' (the remainder). The portion, in turn, was further subdivided into a number of smaller erven, in accordance with the development plans of Innova. The representatives E of both Schmidt Bou and Innova always intended that only the portion would be transferred to the latter while the former would retain ownership of the remainder. This was the evidence of Mr CJ Schmidt, on behalf of Schmidt Bou, which remained uncontested, because there was no evidence by the erstwhile directors of Innova, and the liquidators F were not themselves in a position to dispute these facts. In any event, this evidence was, of course, consistent with the clear terms of the deed of sale. What is more, that the representatives of Innova appreciated that it was to become the owner of only the portion and not the whole of the mother erf, is also borne out by a letter to Schmidt Bou prior to transfer being effected under the deed of sale, in which they offered, on behalf of G Innova, to purchase the remainder for an additional R500 000. Although such agreement was never concluded, it indicated that Innova was aware that it had not purchased the whole mother erf.

[4] After the conclusion of the agreement of sale, an attorney, Mr André Kleynhans, H was instructed to attend to the transfer of the property sold. But, despite the fact that Kleynhans was in possession of the deed of sale, he proceeded to transfer, not only the portion, but the entire mother erf, to Innova. How this happened is not clear. Apparently Kleynhans did so on the strength of a power of attorney which was filed with the Registrar of Deeds. This power of attorney which was, on the face of it, signed by I Schmidt in November 2003 on behalf of...