THE SUPREME COURT OF APPEAL OF SOUTH AFRICA
JUDGMENT
Not Reportable
Case No: 543/2018
In the matter between:
GOLDEX 16 (PTY) LTD                                                               APPELLANT
and
DENE CAPPER NO                                                       FIRST RESPONDENT
DENE CAPPER                                                         SECOND RESPONDENT
IPROTECT TRUSTEES (PTY) LTD                         THIRD RESPONDENT

Neutral citation:  Goldex 16 (Pty) Ltd v Capper NO & others (543/2018) [2019]
ZASCA 105 (4 September 2019)

Coram:
Leach, Saldulker JJA and Tsoka AJA
Heard:
29 August 2019

Delivered: 4 September 2019

Summary: Invalid written agreement of sale of immovable property –
respondent signing agreement on behalf of a trust without necessary authority –
seller abandoning claim for specific performance against the trust but seeking to
hold respondent liable for payment of the purchase price, tendering to transfer the
immovable property to him – claim dismissed.

________________________________________________________________
ORDER
________________________________________________________________

On appeal from: Gauteng Local Division of the High Court, Johannesburg
(Van der Nest AJ sitting as court of first instance):

The appeal is dismissed with costs.
________________________________________________________________
JUDGMENT
________________________________________________________________

Leach JA (Saldulker JA and Tsoka AJA concurring)

[1] On 24 January 2013, the appellant and an entity described as the Des
Property Trust, represented at the time by the Mr Dene Capper, cited as the second
respondent in this appeal, signed a written agreement of sale in which the trust
purported to purchase a real right of extension reserved in terms of s 25(1) of the
Sectional Titles Act 95 of 1986 (the Act) in respect of a sectional title scheme,
against payment of a purchase price of R1.45 million. It is common cause that the
agreement was obliged to comply with the provisions of the Alienation of Land
Act 68 of 1981, that it did not do so, and that it was therefore void ab initio.

[2] The appellant subsequently instituted action against the trust represented
by both its trustees, Mr Capper and his co-trustee, iProtect Trustees (Pty) Ltd,
seeking, inter alia, payment of the purchase price. It also sued Mr Capper in his
personal capacity. At the commencement of the proceedings in the court a quo,
the appellant abandoned its claim against the trustees, conceding that the alleged

sale had not complied with the Act and was therefore unenforceable. However
the proceedings continued against Mr Dene Capper in his personal capacity. At
the conclusion of the hearing the claims against both the trust and Mr Capper
were dismissed but, with leave of the court a quo, the appellant appeals to this
court.

[3] The appellant never sought to appeal against the dismissal of its claim
against the trust and restricted itself to appealing against the dismissal of its claim
against Mr Capper in his personal capacity. Thus despite the papers indicating
that the parties to the appeal are those a quo, in truth the trust plays no part in
these proceedings. Accordingly I shall from now on refer to Mr Capper simply as
‘the respondent’.

[4] As mentioned at the outset, the written agreement upon which the appellant
founded its claim was purportedly concluded on 24 January 2013, the respondent
having signed the agreement on behalf of the trust. Of material relevance are the
provisions of clause 12.1 of the agreement which read as follows:
‘12. CAPACITY OF PURCHASER
12.1
Should the purchaser be a company, a close corporation, or an existing trust, the
signatory hereto warrants and binds himself in his personal capacity by virtue of his
signature hereto –
12.1.1 that he is duly authorised to enter into this agreement on behalf of the company, close
corporation or trust;
12.1.2 that the company, close corporation or trust is lawfully entitled to acquire and take
transfer of the property;
12.1.3 that all conditions have been complied with in order to make this agreement binding on
the company, close corporation or trust; and
12.1.4 that the company, close corporation or trust will duly and punctually comply with all
its obligations in terms of this agreement.’

[5] The fact of the matter is that the respondent was not duly authorised to
enter into the agreement on behalf of the trust as set out in 12.1.1. Nor for that
matter had all conditions been complied with in order to make the agreement
binding upon the trust as set out in 12.1.3, nor did the trust duly and punctually
comply with its obligations in terms of clause 12.1.4. This was because there was
another trustee who had not authorised the sale and refused to do so. For this
reason the agreement was void.

[6] Despite the invalidity of the sale, the appellant contended that the
respondent, as the person who signed the agreement on behalf of the trust, should
be compelled to pay the purchase price, and tendered to transfer the property to
him if he did so. This, counsel for the appellant argued, was due to the respondent
having breached the warranty he had given, that such warranty was severable
from the sale itself, and that as it had been breached, the appellant should be put
into the same position it would have been in had the warranty not been breached.
To do this, so it was contended, required the respondent as guilty party to pay the
R1.45 million the trust would have paid against transfer of the property. The
argument is, then, that the claim is not one for specific performance of the invalid
sale, but flows from the breach of the warranty when that sale could not be
enforced.

[7] The ingenuity of this argument is surpassed only by its lack of substance.
Despite appellant’s counsel’s contrary protestations, what the appellant is
essentially seeking is specific performance of a void and invalid contract against
the person who signed that contract but was not a party to it – this on the basis
that if he’d had the authority to sign, which he had not, the property would have
been sold to another. This merely had to be stated to be rejected.

[8] In an attempt to overcome this problem, the appellant argued that it was a
tacit or implied condition of the warranties I have set out above that ‘if the
purchaser was not bound by the agreement as a consequence of the non-fulfilment
of one or more of such warranties, then the [respondent] would be liable to fulfil
or to ensure the fulfilment of all and any obligations that would have rested on
the purchaser had it been bound by the agreement’.1

[9] Appellant’s counsel was unable to point to any authority from which such
a term was to be implied as a matter of law. He fell back on an argument that the
officious bystander, if asked, would have immediately replied that such a clause
must have been within the contemplation of the parties when they contracted. No
circumstances from which this so-called tacit condition could be implied appear
from the evidence. I understood counsel to base his argument in this regard solely
upon the terms of clause 12.3 of the sale agreement.

[10] That clause provided that in the event of clause 12.2 not being fulfilled, the
signatory ‘shall be deemed to have acted in his personal capacity and shall be
deemed to be the purchaser in terms of this agreement’. Clause 12.2, however,
provided that in the event of the signatory acting as trustee for a company or close
corporation to be formed (not a trust such as is here the case) he or she undertook
to procure that the company or close corporation would be duly incorporated
within three months and would adopt and ratify the agreement, and would be
bound as surety and co-principal debtor with such company or close corporation
for the due and punctual performance of all its obligations under the agreement.

[11] Those provisions related solely to the event of the signatory, at the time the
agreement, purporting to act on behalf of a company or close corporation still to

1 I quote the clause alleged in the appellant’s amended particulars of claim.

be formed. That is not the case here. As the court a quo correctly observed in this
regard, the argument:
‘. . . confuses and conflates the rights against a signatory of the sale agreement under 12.1 with
the rights against such signatory under clauses 12.2 and 12.3. Had the [respondent] signed as
trustee for a company or close corporation to be formed then, in accordance with 12.3, [he]
could have been “deemed to be the purchaser in terms of this agreement”. No equivalent right
exists where the signatory represents an existing trust and there is no basis upon which the
[respondent] can be deemed to be the purchaser or . . . regarded “as if [he] was the purchaser
of the real right”.’

[12] There is therefore no room to import the tacit term contended for by the
appellant. At one stage during his address, counsel for the appellant conceded that
should we find against the appellant on this issue, the claim had to fail and
abandoned any reliance upon a claim for damages. In reply, however, he changed
his stance, resurrected an argument that the claim as pleaded was susceptible to
be understood as a claim for damages, and argued that the measure of those
damages would be the amount of the purchase price; but that, to avoid injustice,
his client would then tender transfer of the immovable property. This, once more,
would have been no more than an order for specific performance of the invalid
sale under the ruse of such an order being one for damages.

[13] I am satisfied that theoretically the respondent could be held liable to the
appellant for damages flowing from his breach of warranty – see Claude Neon
Lights (SA) Ltd v Daniel 1976 (4) SA 403 (A) at 408E-409F and the authority
there cited. However, no claim for damages is formulated in the appellant’s claim
and, most importantly, no evidence relevant to the quantum of damages was led.
In the light of the offer to transfer, one must presume that the property is still in
the possession of the appellant; but one has no idea as to whether its value is more
or less than the agreed purchase price.

[14] As this court observed in Katzenellenbogen Ltd v Mullin 1977 (4) SA 855
(A) where a contract of purchase and sale of a marketable commodity is breached
by non-performance, the extent of the innocent party’s loss is generally
established by measuring the difference between the price sold and the market
value – and that if a claimant seeks to avail itself of a different measure it is
necessary to satisfy the court that the measure it contends for is appropriate in all
the circumstances. None of this was done in the present case. Consequently, even
if one was to be extremely charitable by regarding the pleadings as containing a
claim for damages, such damages have not been proved.

[15] For all these reasons the court a quo correctly dismissed the appellant’s
claim. The only mistake it made was to conclude that there was a reasonable
prospect of success when it granted leave to appeal. This appeal was inevitably
doomed to failure.

[16] The appeal is dismissed with costs.

_____________
L E Leach
Judge of Appeal

Appearances

For the Appellant:
G F Porteous

Instructed by:
Jordaan & Wolberg Attorneys, Johannesburg

A P Pretorius & Vennote, Bloemfontein

For the Respondent:
N P G Redman SC
Instructed by:

Le Roux Vivier Attorneys, Johannesburg

Lovius Block, Bloemfontein