THE SUPREME COURT OF APPEAL
REPUBLIC OF SOUTH AFRICA
JUDGMENT

Case no:  617/07

J R 209 INVESTMENTS (PTY) LTD

First Appellant
M & T DEVELOPMENT (PTY) LTD

Second Appellant

and

PINE VILLA COUNTRY ESTATE (PTY) LTD                Respondent
___________________________________________________________

Case no:  2/08

PINE VILLA COUNTRY ESTATE (PTY) LTD

Appellant

and

J R 209 INVESTMENTS (PTY) LTD

Respondent
___________________________________________________________
Neutral citation: J R 209 Investments v Pine Villa Estates (617/07); Pine
Villa Estates v J R 209 Investments (2/08) [2009] ZASCA 3 (26 February
2009)

CORAM:
Harms ADP, Ponnan, Cachalia JJA, Leach and

Mhlantla AJJA

HEARD:

18 November 2008
ORDER:

28 November 2008
REASONS:
26 February 2009
CORRECTED:

SUMMARY:
Validity of a deed of sale of land – whether the
description of property alienated was sufficiently clear in terms of s 2(1)
of the Alienation of Land Act 68 of 1981 – interdict preventing the
establishment of a township development set aside – application for leave
to amend pleadings dismissed.
___________________________________________________________
ORDERS
___________________________________________________________

In J R 209 Investments (Pty) Ltd and M & T Development (Pty)
Ltd v Pine Villa Estates (Pty) Ltd (case 617/07):
(i)
the appeal is upheld with costs, including  the costs of two counsel;
(ii)   the order of the court below is set aside and replaced with an order
in the following terms:-
‘The application is dismissed with costs, inclusive of the costs of two
counsel.’

In Pine Villa Estates (Pty) Ltd v J R 209 Investments (Pty) Ltd
(case 2/08):
The appeal is dismissed with costs, including the costs of two counsel.

___________________________________________________________

REASONS FOR JUDGMENT
___________________________________________________________

HARMS ADP et MHLANTLA AJA (PONNAN, CACHALIA JJA
and LEACH AJA concurring):

Introduction
[1] These reasons for judgment deal with two related appeals: the first
was an appeal against the judgment of Rabie J in J R 209 Investments
(Pty) Ltd and M & T Development (Pty) Ltd v Pine Villa Estates (Pty) Ltd
(case no 617/07) (the first case); and the second was against a judgment
of Botha J in Pine Villa Estates (Pty) Ltd v  J R 209 Investments (Pty) Ltd
(case no 2/08) (the second case).  As the citations suggest, the parties in
the second appeal were also adversaries in the first.

[2] Both appeals arose from an agreement to sell land and the seller’s
allegation that the agreement was either void or had been cancelled. They
were heard together. Due to the urgency of the matter the orders issued on
28 November 2008, it having been intimated then that reasons were to
follow. The first case concerned the grant of an interdict by Rabie J,
effectively preventing the purchaser from dealing with the property sold
pending the conclusion of action proceedings. In that matter the order of
this Court was to uphold the appeal with costs, including the costs of two
counsel; to set aside the order of the court below and replace it with an
order in the following terms:

‘The application is dismissed with costs, inclusive of  the costs of two counsel.’

The second case concerned the refusal by Botha J to permit the seller of
the property to amend its particulars of claim to reflect certain additional
causes of action on which the interdict was based. The order on appeal
was as follows:

‘In case 2/08, the appeal is dismissed with costs, including the costs of two counsel.’

It will be immediately apparent that the two learned judges had
diametrically opposed views about the matter.

[3] Although the appeals depend on essentially the same legal
questions, different considerations may arise in deciding the two cases
because amendments and interdicts are not decided on the same
principles.

The contract
[4] Pine Villa Estates (Pty) Ltd was the seller of a property which for
the sake of convenience will be referred to as Portion 7. Its sole
shareholder and director was Mr Patrick Ian Oberem. He was not a party
to the litigation although he was the main deponent to the affidavits in the
interdict proceedings. The purchaser was JR 209 Investments (Pty) Ltd
while M&T Development (Pty) Ltd was the developer of the property,
which had been bought for the purpose of township development. The
proposed township in the course of events came to be known as
Monavoni Extension 18, which consisted of a number of properties
including Portion 7. The parties will be referred to by their aforesaid
contractual capacities.

[5]  On 12 May 2004, the seller (represented by Mr Oberem) and the
purchaser entered into an agreement of sale in terms of which the seller
sold to the purchaser the immovable property described as ‘portion 7 of
the farm Swartkop 383, JR, Gauteng – in extent 8,5653 hectares’.  The
purchase price of R3,5m was payable in two tranches: a non-refundable
deposit of R500 000 was payable upon acceptance of the offer to the
seller and the balance on registration (guarantees had to be issued within
90 days of the date of signing).

[6] A few further terms have to be noted. In terms of clause 5.1 the
property was to be transferred to the purchaser as soon as the purchaser
had complied with ‘all obligations in terms of this agreement’.
Possession of the property was to pass on registration subject to the right
of ‘the seller’ to occupy the portion of the property mentioned in clause
11.2 (to which we shall revert soon). The agreement also recorded that
the purchaser would, already upon acceptance of the offer, immediately
initiate the process of township development.

[7] Much of the case turns on clause 11.2 which was in these terms:

‘Both parties take note that a portion of this property between 5000 m2 and 5653 m2 in
extent and including the residential house on this property is to be transferred into the
name of Ian Patrick Oberem I.D. 6504135149081 as soon as sub-divisional diagrams
are available to effect this transfer. The Purchaser shall be liable for all costs relating
to this subdivision and hereby guarantees that these diagrams will be available not
later than 7 (seven) months after date of this agreement. The Seller shall be liable for
all costs regarding the transfer of this property into the name of I.P. Oberem.’

[8] On 1 October 2004, Portion 7 was transferred to the purchaser. The
purchaser was, however, unable to make the diagrams referred to in

clause 11.2 ‘available’ within the agreed period or for that matter when
the action was instituted during February 2007 or even later when the
interdict proceedings were launched during May 2007. The effect thereof
is that the property described in clause 11.2 (the clause 11.2 property)
was not transferred into the name of Mr Oberem. The reasons for the
purchaser’s failure to perform in terms of this ‘guarantee’ or to transfer
the portion are of no consequence and need not be related.

The seller’s claim
[9]  The seller then issued summons against the purchaser claiming
retransfer of Portion 7 and, in the alternative, payment of damages being
the difference between the present market value of the property and the
purchase price. The cause of action was an alleged breach of the sale
agreement, arising, so it was contended, from the purchaser’s failure to
obtain the sub-divisional diagrams within the stated period. The
particulars further alleged that due notice had been given in terms of the
cancellation clause; that the purchaser had failed to rectify the breach
within the stated period; and that the contract had been cancelled.

[10]  When the seller decided to launch the interdict proceedings it
received advice to amend its cause of action and to base the interdict
proceedings on the new causes. The application to amend the particulars
of claim (which was opposed) and the interdict proceedings followed
different routes and the interdict proceedings terminated before the
amendment proceedings. In order to assess the validity of the seller’s
causes of action, both for purposes of the amendment and the interdict, it
is convenient to begin with a consideration of the amendment application.

[11]   It is not neccessary to quote the terms of the proposed amendment
but it boils down to this. First, the seller alleged that the agreement of sale
was invalid because it did not comply with the provisions of s 2(1) of the
Alienation of Land Act 68 of 1981, which reads as follows:

‘No alienation of land after the commencement of this section shall, subject to the
provisions of section 28, be of any force or effect unless it is contained in a deed of
alienation signed by the parties thereto or by their agents acting on their written
authority.’

Its case was that although Portion 7 had been adequately identified, the
area to be excluded and re-transferred to Mr Oberem in terms of clause
11.2 was not; the contract was accordingly invalid and unenforceable ab
initio for non-compliance with s 2 of the Act inasmuch as that piece of
land could not be identified with reference to the provisions of the
contract alone.

[12]   The alternative cause of action was based on a failure to comply
with the ‘guarantee’ contained in clause 11.2 within the time limit. The
seller sought to make it clear that it was relying on the fact that a
guarantee imposes an absolute obligation to comply and that it is not
necessary to first place a party who has failed to honour the guarantee in
mora in order to cancel.

[13] Before dealing with these two causes of action it is necessary to
deal with another amendment which has no bearing on the relief sought
but which was ostensibly introduced to forestall a defence. The seller
wished to allege that the property sold was not Portion 7 as set out above
but Portion 7 minus the clause 11.2 portion and that Mr Oberem was the
person authorized to receive transfer of the latter portion as the solutionis

causa adjectus of the seller. The seller presumably anticipated that the
purchaser would allege that clause 11.2 was intended to create a contract
for the benefit of a third person and that Mr Oberem was accordingly the
person to enforce its provisions after having accepted the benefit. (It
transpired during the interdict proceedings and from the notice of
objection to the amendment that this was indeed the purchaser’s case.)
The other unexpressed reason for these allegations may well have been to
anticipate reliance on the Wilken v Kohler1 principle, which was
incorporated into the Act - namely that an alienation which does not
comply with the provisions of s 2(1) ‘shall in all respects be valid ab
initio if the alienee had performed in full in terms of the deed of
alienation or contract and the land in question has been transferred to the
alienee.’2

[14] Although the seller initially sought to rely on either the express
alternatively tacit terms of the contract, it soon became clear that sole
reliance was placed on tacit terms. These tacit terms are, however, in
conflict with the express terms of the contract. The merx was clearly
identified as Portion 7. Although ultimately Portion 7 less the clause 11.2
portion would have come to be in the hands of the purchaser, the parties
decided to structure their agreement differently. The clause 11.2 portion
was not to be retransferred to the seller, but rather to its sole shareholder
and director, Mr Oberem. It is consequently artificial to redefine the merx
as suggested in the amendment. In our view the facts of the present case
are similar to those in Olifants Trust Co v Pattison3 and the ratio of that
judgment at 891C-G is applicable.  The contract further stated that
transfer was to be effected after the purchaser had complied with ‘all’

1 Wilken v Kohler 1913 AD 135.
2 Section 28(2).
3 1971 (3) SA 888 (W) at 891.

obligations in terms of the agreement. That provision clearly did not
relate to clause 11.2. And, it will be recalled that transfer did take place
after payment of the purchase price. Nor it is it alleged to have taken
place in error (except in relation to the validity of the contract). Transfer
duty had to be paid by the purchaser on the full price and the seller
undertook to pay the transfer costs (which would include transfer duty)
on the clause 11.2 portion - facts that are destructive of the seller’s
argument.4 Mr Oberem could also not have been an adjectus simply
because the clause 11.2 portion had to be registered in his name and not
in the name of the seller. One person cannot without more receive
transfer of an immovable property on behalf of another. The expressed
intention was that Mr Oberem would become owner of that portion on
registration. It is conceivable that the agreement was thus structured for
tax or transfer duty reasons or to make the seller company a shell
company. There is no reason why the parties should not be held to their
chosen structure irrespective of their motives.

[15] We are satisfied that the clear intention of the parties was to create
a contract for the benefit of a third party. Since Mr Oberem negotiated
and signed the agreement one would have assumed that he had then
already accepted the benefit of clause 11.2. If he did, it follows that he
was the only person who was entitled to enforce its provisions.
Cancellation of the main agreement was not an option available to him.
All he could claim was specific performance under clause 11.2 or
damages for non-compliance with its provisions. If he failed to accept the
benefit, there was nothing the seller could claim vis-à-vis the purchaser.
This conclusion disposes at the same time of the alternative based on the
guarantee argument.

4 Olifants Trust Co v Pattison at 890F-H.

[16] It follows from this that Botha J correctly dismissed these
particular aspects of the application to amend and that Rabie J had erred
in holding that the seller had locus standi to reclaim Portion 7.

Validity of the Deed of Sale
[17]  We now turn to deal with the validity of the deed of sale. Rabie J
held that the description of the portion of land mentioned in clause 11.2
was not sufficiently clear to comply with the requirements of s 2 and
would result in an insufficient description of the res vendita if it could not
be severed from the remaining part of the contract. He held that Mr
Oberem at all relevant times intended to remain in his house and the
adjacent area and that he would become the registered owner thereof.
The learned judge accordingly held that the deed of sale was prima facie
void for want of compliance with s 2(1).  Botha J, on the other hand, held
that the deed of sale was valid because the property was adequately
described and the fact that the shape and exact configuration of the clause
11.2 portion were left entirely to the purchaser’s discretion depending on
the layout of the township did not invalidate the agreement.

[18]   It does not matter for purposes of this part of the judgment whether
the property sold was Portion 7 or, as alleged by the seller, Portion 7
minus the clause 11.2 portion. Bearing in mind that the Act applies to the
alienation of land which by definition ‘includes’ a sale, exchange or
donation, the clause 11.2 portion was ‘alienated’ by the purchaser to Mr
Oberem.

[19] The test for compliance with the provisions of s 2(1) is whether the
land alienated can be identified on the ground by reference to the

provisions of the contract without recourse to evidence from the parties as
to their negotiations and consensus.5 The section does not however,
‘require a written contract of sale [now: alienation] to contain, under pain
of nullity, a faultless description of the property sold couched in
meticulously accurate terms’.6

[20] For the proposition that this agreement was void for failing to
describe the merx, counsel for the seller relied on Parsons v M C P
Bekker Trust (Edms) Bpk.7    The property sold in Parsons was described
as a portion of a certain farm measuring 92,5764 hectares excluding the
dwelling house and vacant ground around it of approximately 3965m².
The Court held that the property described was inadequately described
because, as it said, not a word was contained in the contract as to how the
configuration of the homestead area was to be determined (at 104C-D)
and that to render the agreement effective the parties should have
included some indication of how or by what means the shape of the land
embracing the homestead portion was to be determined (at 104E-F).

[21]   In Clements v Simpson8 the part sold had to be subdivided from the
property as a whole.  The seller contended that the part sold was
inadequately described and that the contract was thus of no force or effect
for want of compliance with s 1 of the then applicable General Law
Amendment Act 68 of 1957 (which was almost identical to the provisions
of s 2(1)). The part sold was identified by stating the exact area; the
location (adjoining a named street, situate in the north-western extremity
of the main property); and the minimum frontage on that street. The
judgment then stated (at 8E-H) :

5 Clements v Simpson 1971 (3) SA 1 (A) at 7F-G.
6 Van Wyk v Rottcher’s Saw Mills (Pty) Ltd 1948 (1) SA 983 (A) at 989.
7 1978 (3) SA 101 (T).
8 Supra.

‘Now it is apparent that those provisions do not, and could not have been intended to,
enable identification of the land on the ground.  The reason is that the parties could
not but have realised that, in giving effect to the foregoing provisions, there was a
variety of possible shapes which the seller could select in bringing about the sub-
division of her land. In that regard the site sold is one of a class. The area remains
constant (40,000 square feet); and the general location is fixed (North-western
extremity of Portion 1); but the shapes will depend upon (a)  the extent to which the
selected road frontage exceeds the agreed minimum of 175 feet, and (b) the
geometrical layout - the site might be square, or rectangular, or its angles might not be
90°.’

The court nevertheless held that the contract was valid because there were
indications in the contract that the seller would determine the shape.
Distinguishing the case from Botha v Niddrie,9 Holmes JA said (at 9A-
B):

‘But the instant case is different because here the intention of the parties, as gathered
from the language of their contract, was not to enable identification of the land sold
by reference to description; it was to be identifiable only after the seller had decided
upon the lay-out and shape and sub-division of a site conforming to certain specified
requirements. It is in my view a clear example of the second category mentioned
earlier. The consensus of the parties was complete. All that was needed for
performance was the intended unilateral act of the seller in the matter of shape and
sub-division. The fact that survey was required for that purpose cannot affect the
question; ... I therefore hold that the contract does comply with the provisions of sec.
1 (1) of Act 68 of 1957.’

[22] In the present case the situation is similar. The contract envisaged
that the purchaser would establish a township on Portion 7 and that the
homestead portion was to form a separate erf as part of the development.

9 1958 (4) SA 446 (A).

The purchaser by necessary implication had the right to determine the
shape and size of the erf subject to two express limitations, namely that
the residence had to be included and that the erf had to be between 5 000
and 5653 m2.10 There was an additional implied limitation namely that the
purchaser’s determination should have been bona fide.11

[23] In the result we are of the view that the description of the property
alienated in terms of clause 11.2 sufficed for purposes of s 2(1) and that
this ground of attack has no merit. This means that the amendment was
rightly refused by Botha J and that Rabie J had erred in finding that the
seller had any right that could be protected by an interdict.

Appealability of the Interim Interdict
[24] The final issue to be decided is whether the interdict granted by
Rabie J was appealable. He granted an order in the following terms:

‘An interim interdict is granted pending the final adjudication of [the action] . . . in
terms of which the [purchaser and the developer] are restrained from:
‘(a) Lodging the plans, diagrams or title deeds in respect of the township Monavoni
Ext 18 for endorsement or registration . . . or
(b) . . . procuring the registration of the general plan of the township Monavoni Ext 18
. . .,
(c) Taking any further steps . . . declaring the township an approved township . . ..’

[25]   In Cronshaw & Another v Coin Security Group (Pty) Ltd12  this
Court held that an interim interdict was appealable if it were final in

10 Cf Mayfair South Townships (Pty) Ltd v Jhina 1980 (1) SA 869 (T) at 872D-873E.
11 SA Forestry Co Ltd v York Timbers Ltd 2005 (3) SA 323, [2004] 4 All SA 168 (SCA). Cf NBS
Boland Bank Ltd v One Berg River Drive CC; Deeb v ABSA Bank Ltd;  Friedman v Standard Bank of
SA Ltd 1999 (4) SA 928, [1999] 4 All SA 183 (SCA).
12 1996 (3) SA 686 (A).

effect and not susceptible to alteration by the court of first instance.
Metlika  Trading Ltd and Others v Commissioner, South African Revenue
Service13  held that in determining whether an order is final, it was
important to bear in mind that ‘not merely the form of the order must be
considered but also, and predominantly, its effect.’

[26]   The order which was sought and granted had as its substrate that
the purchaser and the developer were prohibited from proceeding with the
establishment of the township as a whole and not only in respect of the
development of Portion 7. The order affected the entire development, yet
the dispute between the parties related to portion 7 only.  The order was
overbroad. The right to develop the township as a whole is not an issue
that would be decided by the trial court and it was consequently final in
effect even if only for a limited period.14  In our view the merx could have
been preserved without the necessity for an order in those terms.  It
follows therefore that the order of Rabie J was appealable.

Conclusion
[27]   The findings made earlier that the seller had no right, prima facie
or otherwise, that could have been protected by an interdict mean that the
order granted by Rabie J had to be set aside.

[28]  The other side of the coin is that in view of our interpretation of the
contract  the  proposed  amendments  were ill-conceived.   In   the   result

13 2005 (3) SA 1 (SCA) at para 23.
14 Maccsand CC v Macassar Land Claims Committee [2005] 2 All SA 469 (SCA).

Botha J was correct in dismissing the seller’s application to amend.  This
appeal was consequently dismissed.

__________________________

L.T.C. HARMS

ACTING DEPUTY PRESIDENT

_____________________

N. Z.  MHLANTLA

ACTING JUDGE OF APPEAL

APPEARANCES:

For Appellant:
A C Ferreira SC

I Ellis

Instructed by

A B Löwe Attorneys, Pretoria

Honey Attorneys, Bloemfontein

For Respondent:
S J du Plessis SC

J C Viljoen

Instructed by

Le Roux Du Plessis Attorneys, Pretoria

Naudes Inc, Bloemfontein