Storm & Co v Durban Municipality

• Jurisdiction: South Africa
• Judge: Innes CJ, Solomon JA, De Villiers JA, Kotzé JA and Wessels JA
• Judgment Date: 21 October 1924
• Hearing Date: 30 September 1924
• Court: Appellate Division

Kotzé , J.A.:

It will be advisable briefly to state the facts in this case. It appears that in March, 1913, one Webster purchased a lease of Lot 16, Block B, with certain buildings thereon of a value above £500, put up by public auction by the Corporation of Durban under the provisions of sec. 77 of Law 19 of 1872. The annual rental payable under this lease was £200. The lease was for the period of 10 years terminating in March, 1923. Among the various clauses in the lease is one conferring on the lessee the right of renewal in perpetuity in terms of sec. 79 of the said Law, and of sec. 2 of Law 27 of 1884 and sec. 2 of Ordinance 9 of 1912. It was provided in the lease that on the expiration "of each recurring period the rental is to be adjusted by mutual agreement, or failing that, by arbitration in manner contemplated by secs. 79 and 80 of Law 19 of 1872." In 1921 the lease was ceded by Webster to Storm & Co., who then paid the rental, and as the latter have decided to renew the lease in terms of the clause giving them this right, the rental has to be regulated by mutual agreement, and failing such agreement, by arbitration.

The parties being unable to agree as to the amount of the

Kotzé, J.A.

renewed rental, the matter was referred to arbitration. The arbitrators, however, disagreed, and an umpire having been appointed as directed by the Act, the latter made his award, in the alternative, leaving it for the decision of the' court below to determine which alternative should be adopted. The award sets out that the question which the Court is asked to decide is "whether in estimating the annual rental for the current renewal period of the lease, the buildings erected upon Lot 16 B, which became the property of the council, when the lease of the said' Lot lapsed in 1911, are to be taken into account or excluded?". The award adds that if the Court should hold that these buildings are to be taken into account, then the annual rental for the current renewal period of the lease is fixed at. £200; but if the Court should determine that the buildings are to be excluded then the annual rental is to be taken at the sum of £20.

I agree with the learned JUDGE-PRESIDENT that the answer to the above question, submitted to the Natal Provincial Division, turns upon the construction to be placed on sec. 79 of Law 19 of 1872. Before considering this point, it will be convenient to refer to the two immediately preceding sections of this enactment. Sec. 77 of the Act authorises the council of a municipal corporation, with...