Delpech v Holloway and Others

• Jurisdiction: South Africa
• Judge: Spilg J
• Judgment Date: 01 December 2010
• Citation: 2011 (2) SA 194 (GSJ)
• Docket Number: 18282/2010
• Hearing Date: 20 August 2010
• Counsel: GF Porteous for the applicant. N Riley for the respondents.
• Court: South Gauteng High Court, Johannesburg

Spilg J:

[1] The applicant purchased from the second respondent, a developer, C share block No 2 in the third respondent. The third respondent is the share block company. In terms of this transaction, and linked to share block No 2, the applicant took cession of the second respondent's right, title and interest in and to a use and occupation agreement. The effect of the transaction was to give the applicant exclusive title to a piece of land, or unit, on which a chalet was built, and non-exclusive use of the D common areas within the entire development.

[2] The first respondent is a director of the share block company and, together with her husband, holds the members' interests in the developer. The first respondent is also the managing agent of the share block scheme operated by the third respondent. E

[3] In terms of the sale agreement the second respondent undertook to construct a chalet on a specified area of land allocated for this purpose in terms of the use agreement. During October 2007 the applicant was able to take occupation of the chalet. There are in total six units, of which (at the time relevant to these proceedings) only two were developed and F acquired from the developer, one by the applicant and the other by the first respondent. The balance of the development, and the four remaining share blocks it represents, remains held by developer.

The applicant paid the full purchase price for the acquisition of the share block and use agreement. In a share block scheme the developer initially G holds all the 'shares' in the development, and divests itself of those blocks of shares allocated to a unit in the development, as and when the relevant unit (in this case a chalet) is sold. In this way the person acquiring the share block obtains effectively full rights of occupation and disposal of the chalet, as if that person were the owner, together with the common area use rights. H

[4] A dispute arose between the applicant and the first respondent with regard to how the levies were to be split. Part of the difficulty is that amounts that may have been owed in respect of the entire share block were sought to be appropriated to the applicant and first respondent in I equal shares. This did not necessarily prejudice the first respondent, because she and her husband, through the second respondent, effectively were the developers. A second bone of contention was the attempt by the second respondent to claim, through charges raised by the third respondent, and which it split between the applicant and the first respondent, legal expenses incurred in engaging attorneys to deal with the dispute it J

Spilg J

A had with the applicant, regarding the proper split of expenses between her, and the first and second respondents. The applicant contended that these amounts were not for her account.

[5] The issue of the basic levies, and what amounts ought to be raised, B appears to have been resolved in terms of a meeting held and which was recorded by the first respondent in a document...