THE SUPREME COURT OF APPEAL
OF SOUTH AFRICA
CASE NUMBER 458/97
In the matter between:
MILLSELL CHROME MINES (PTY) LIMITED
Appellant
and
THE MINISTER OF LAND AFFAIRS OF THE
REPUBLIC OF SOUTH AFRICA (IN HIS
CAPACITY AS TRUSTEE OF THE BAFOKENG
TRIBE)
First Respondent
THE REGIONAL DIRECTOR : DEPARTMENT OF
MINERAL AND ENERGY AFFAIRS
Second Respondent
THE REGISTRAR OF DEEDS
Third Respondent
CORAM:
ZULMAN, STREICHER JJA
MELUNSKY, FARLAM and MADLANGA AJJA
Date of Hearing:
14 September 1999
Date of Judgment:  28 September 1999
MINERAL LEASE - WHETHER OPTION DULY EXERCISED
JUDGMENT
ZULMAN JA:

[1]   The issue in this appeal is whether the appellant entered into a valid and
enforceable notarial mineral lease with the trustee of the Bafokeng Tribe.
[2]   In December 1993 the President of the Republic of Bophuthatswana, in his
capacity as trustee of the Bafokeng Tribe, as the first applicant, and the Tribe, as the
second applicant, commenced motion proceedings against the appellant as first
respondent in the Supreme Court of Bophuthatswana.  The Regional Director:
Department of Mineral and Energy Affairs and the Registrar of Deeds were  cited
as the second and third respondents respectively but they did not oppose the
application.   They also take no part in this appeal and abide by the decision of this
Court.  After re-incorporation of Bophuthatswana into the Republic of South Africa
the Premier of North West Province attempted to substitute himself as the first
applicant but his substitution was declared to be invalid.  The true successor to the
first applicant, the President of the Republic of South Africa, designated the
Minister of Land Affairs as the Tribe's trustee.  The Tribe withdrew as a party to the
proceedings and the Minister, in his capacity as trustee, became the sole applicant.
He is now the first respondent in this appeal.
[3] The notice of motion as finally amended claimed declaratory orders to the
effect that there was no exercise, alternatively no valid or effectual exercise by the
appellant of an option to acquire a mineral lease under and in terms of a notarial
prospecting agreement which contained the option;  alternatively, if there was a

valid and effectual exercise of the option, the appellant thereafter abandoned the
resultant mineral lease;  and, further alternatively, that the option contained in the
notarial prospecting agreement lapsed without  having been exercised.
[4] Waddington J dismissed the application with costs but granted the first
respondent leave to appeal to the Full Court of the Bophuthatswana Division of the
High Court.
[5] The Full Court  (Khumalo, Hendler and Chulu JJ) allowed the appeal with
costs and declared that no mineral lease arose under or in terms of the agreement
relied upon by the appellant.
[6]     On 18 August 1997 this court granted special leave to the appellant to appeal
against the judgment of the court a quo and ordered the costs  of the application to
be costs in the appeal.
[7] The material facts of the case are not in dispute.  On 28 July 1977 a notarially
executed agreement was entered into between the deputy Minister of Bantu Affairs,
acting for and on behalf of the Minister of Bantu Administration, Development and
Education in his capacity "as Trustee of the Bafokeng Tribe under Chief Edward
Molotlegi" as lessor and Palmiet Chrome Corporation (Pty) Limited ("Palmiet") as
lessee.  On 25 October 1978, in terms of a notarially executed document, Palmiet
ceded, assigned and made over all its right, title and interest in the aforesaid
agreement to the appellant.  The amendment to the agreement was notarially

executed on 11 July 1979.
[8] The agreement as amended is of fundamental importance in this appeal.  it is
divided into two parts.  The first part contains a prospecting agreement and the
second an option to acquire a mineral lease.  In order to determine whether a valid
and enforceable mineral lease came into being, it is necessary to decide whether the
option was effectively exercised.  In terms of the prospecting part of the agreement
the lessor granted the lessee the sole and exclusive right to prospect for chrome ore
for a period of up to five years on portions of certain land owned by the lessor.  The
relevant part of clause 3,  which contains the option for the mineral lease, reads as
follows:
"During the Prospecting Period the Lessee shall have the sole and
exclusive option of mining and disposing of Chrome Ore in, on or
under the Mining Area.  The Lessee at its sole discretion, may exercise
these rights by giving written notice to this effect to the Lessor, the
Magistrate Bafokeng and the Bantu Mining Corporation Limited,
Pretoria, and shall state a date within the Prospecting Period upon
which such operations will commence."
It was common cause between the parties that The Bantu Mining Corporation
Limited ceased to exercise functions in the then Bophuthatswana after it became
independent and that notice to him was thereafter not required in terms of clause 3.
[9] Clause 1(a) of the agreement defines the "Prospecting Period" as being a
period of up to 5 (five) years from the date of the agreement, i.e. 28 July 1977.  The
"Mining Area" is the area in which the lessee had the right to prospect.

[10] The outcome of this appeal depends upon whether the requirements of clause
3 and the provisions of section 3(1) of the General Law Amendment Act 50 of 1956
("the Act") were complied with.  The section provides that a lease of any right to
minerals in land shall not be valid unless attested by a notary public.  In my view,
in order to succeed, therefore, the appellant had to establish -
(a)
that the option was exercised in notarial form during the
"prospecting period", i.e. on or before 27 July 1982;
(b)
that written notice of the exercise was given to the following
persons:
(i)
the lessor as defined, namely, the trustee of the Bafokeng Tribe;
and
(ii)
the Magistrate Bafokeng;
(c)
that the appellant duly "[stated] a date within the prospecting
period upon which such operations" [the mining and disposing
of chrome ore] "will commence".
[11] If any one of the above requirements were not fulfilled, it would follow that
there was no effective exercise of the option.
Timeous exercise in notarial form and statement of commencement date.
[12]    It is convenient to consider these two aspects of clause 3 together.  Counsel
for the appellant submitted that the exercise of the option in notarial form occurred

on 7 July 1982.   On this date a document headed "Notarial Exercise of Option to
Take a Mineral Lease" ("Annexure I") was notarially executed.  On behalf of  the
first respondent it was contended that the notarial execution relied upon by the
appellant, even though it occurred timeously, was defective in a number of material
respects.
[13]    One of these defects, so it was argued, was that in the operative portion of
Annexure I, as distinct from the preamble thereto, the appellant purported to
exercise the right to mine manganese ore and not chrome ore.  This, according to the
argument, introduced uncertainty and rendered the notarial document ineffective (cf
Boerne v Harris 1949 (1) SA 793 (A) at 799).  Although a substituted page of the
notarial document which referred to chrome ore instead of manganese ore was
forwarded to the Tribe's attorney, this occurred on 18 August 1982 and after the
date for the exercise of the option had expired.  The respondent's contention was
rejected by Waddington J in the court of first instance but was upheld by the court
a quo.  It would appear to me, however, that the recipient of Annexure I should have
realised that the appellant had intended to exercise the option to mine for chrome ore
and that the reference to manganese ore was an obvious error.  However in view of
the conclusion at  which I have arrived  in regard to the non-compliance with certain
of the other requirements of clause 3 it is not necessary to express a firm view on
the first respondent's contentions concerning this aspect of the matter.

[14]    A further objection advanced by the first respondent was that Annexure I did
not specify a date on which mining would commence.  The document merely
recorded that the appellant exercised the option contained in the agreement and that
it accepted a lease to mine "for manganese ore in, on and under the Mining Area".
It was submitted on behalf of the appellant that although clause 3 of the agreement
required the lessee  to state a date within the prospecting period upon which mining
operations would commence, the agreement drew a distinction between the date of
commencement of the mineral lease and the date of commencement of the mining
operations.  The former, it was submitted, was a material term and required notarial
execution but the latter not.  Reliance was placed on a letter dated 7 May 1982
addressed to the Tribe's attorney and signed by a Mr S M Dougherty on behalf of
the appellant in which it was stated:
"In terms of the rights granted to the Lessee under clause 3, we hereby
exercise the whole and exclusive option thereby granted the Lessee to
mine and dispose of chrome ore in, on or under the mining area (as
defined).  It is our intention to commence such mining operations on
15 July 1982."
(An earlier letter sent to the Tribe's attorney in identical terms and signed by Mr
Dougherty on behalf of Rand Mines Ltd, was not relied upon.)
On a proper construction of the provisions of the  mineral lease it is, however, plain
that the date of commencement of the mineral lease was to coincide with the stated

date on which mining operations were to commence.  Clause 3(h) being one of the
provisions that was to apply to the mineral lease, reads:
"The Mineral Lease shall endure for an initial period of 15 (fifteen)
years from the date advised in the written notices referred to in the first
paragraph of this Clause 3, with two further periods of renewal of 10
(ten) years each if required by the lessee."
The date of the commencement of mining operations was, therefore, also the date
on which the mineral lease was to commence.  This date was a material term of the
lease  (cf Johnston v Leal 1980(3) SA 927(A) at 937B - 938B).    It determined,
inter alia, when the prospecting rights and duties would cease and when the mining
rights and obligations would commence, when the lease would begin and when it
would terminate and when the lessee's obligation to pay mining royalties would
start.  Counsel for the appellant conceded, quite correctly, that if the date of
commencement of mining was material it had to be recorded in a notarially executed
document and that the letter of 7 May 1982 would not suffice in this regard.
[15]    In the court of first instance Waddington J held that in the absence of any
other stated date in Annexure I, it was the date of execution of that document, 7 July
1982, that the appellant
"must have intended should be regarded as the date on which mining
operations would commence".

I am unable to agree with this conclusion.  There is nothing to indicate that the
appellant intended to regard 7 July 1982 as the date on which it would commence
mining operations.  Moreover, even if this was the appellant's intention, it was not
expressed in the document and was not conveyed to the parties referred to in clause
3 of the contract.
[16]   The provisions of the clause, if one reads the clause in its ordinary
grammatical sense, fall to be construed conjunctively and not disjunctively.   The
requirements are imperative, since clause 3 specifies “and shall state a date” (the
emphasis is mine).   The wording is not simply “may” state a date.
[17]    I also agree with the first respondent’s contention that the scheme of clause
3 was that the exercise of the option to bring about a mineral lease did not in itself
lead to commencement of the mineral lease.  The appellant was required  to state a
date.  This would determine two matters.  The first would be the date when mining
operations “will commence” and secondly as a consequence thereof, the date when
the prospecting agreement referred to in the document would cease and a mineral
lease would become operative in terms of the second paragraph of clause 3.  This
paragraph provides as follows:-
“In the event of these mining rights being exercised the liability for
paying prospecting rentals as provided under Clause 1 hereof and the
prospecting rights granted under Clause 2 hereof shall cease as from
the date that the mining right shall commence.  The following terms
and conditions shall then apply as from the date:-”

(A number of terms and conditions  then follow in clauses 3(a) to 3(h)).
There were thus two relevant dates.  The one being the date on which the notice
itself had to be given and the other the date when the mining operations “will”
commence.  The notice had to be given by 27 July and the date upon which mining
operations were to commence had to be on or before the same date.
[18]    It was also argued on behalf of the appellant that Annexure I, which was in
notarial form and was executed in that form on 7 July 1982, “declared on that date”
to exercise the option contained in clause 3 to take “thereby” a lease.  The taking
of the lease, so it was argued, is intended to take effect from the declaration therein
that the appearer states himself “thereby” to take.   That being so the duration of the
lease extended from that date, namely 7 July 1982.  I find this argument untenable.
There might have been some merit in the  argument were it not for the clear and
unambiguous requirement of clause 3 that there was to be a statement which was to
be communicated to “the lessor, the Magistrate Bafokeng and the Bantu Mining
Corporation Ltd” of the date in the written notice exercising the option “in the
Prospecting Period upon which such operations will commence”. This provision
cannot simply be ignored.
As the appellant failed to state in a notarially executed document the date on which
mining operations would commence, it follows that the exercise of the option is of
no force and effect and that no mineral lease came into existence.  There are,

moreover, other obstacles in the appellant's path.  These are considered briefly
hereunder.
The giving of notice
[19]    It is trite that ordinarily and in the absence of any contractual provision to the
contrary, the fact of the exercise of an option which involves the acceptance of an
offer, must, to bring about a binding contract, be communicated to the grantor.  The
exercise of an option is governed by the ordinary principles applicable to the
acceptance of an offer.  (See for example R v Nel 1921 AD 339, Laws v Rutherfurd
1924 AD 261 at 262, and Westinghouse Brake and Equipment (Pty) Ltd v Bilger
Engineering (Pty) Ltd 1986(2) SA 555(A) at 573 E - G and Amcol Collieries
Limited v Truter 1990(1) SA 1 (A) at 4 D-F).  Not only did clause 3 of the
agreement not dispense with communication but it required it in clear and
unequivocal terms.  This is not a case such as Driftwood Properties (Pty) Ltd v
McLean 1971(3) SA 591(A)  where the agreement dispensed with communication
of acceptance. In this case the appellant, as was the situation in Orion Investments
(Pvt) Ltd v Ujamaa Investments (Pvt) Ltd and Others 1988(1) SA 583 (ZS), was
required in terms of clause 3 to communicate its exercise of the option.  Even
although such communication was not required to be in notarial form, it was
required to be in “written form”.  Furthermore the communication had to be made
on or before 27 July 1982.

Counsel for the appellant  correctly conceded that there was no communication of
the purported  exercise of the option before 27 July 1982 and that the option then
lapsed.  He sought, however, to rely on some sort of subsequent communication by
conduct which he called a “waiver”.  He argued that the subsequent communication
by conduct,  enabled one to conclude that the option was “revived”, as it were.  It
seems to me, as I put to counsel for the appellant during the course of his  argument
that one cannot “breathe life into a corpse”.  Van Heerden JA stated the matter in
these lucid terms in Trans-Natal Steenkoolkorporasie Bpk v Lombaard en ‘n Ander
1988(3) SA 625 at 639 I - 640 A:-
“Die opsie moes voor ‘n bepaalde datum uitgeoefen word.  By onstentenis
daarvan sou die bedingde aanbod tot verlenging outomaties verval.  Daar sou
dus nie meer ‘n reg kon wees waarvan die eiseresse  afstand kon doen nie.
Kortom, die eiseresse se “verpligting” om nie die aanbod te herroep nie en
die verweerder se ooreenstemmende reg om dit te aanvaar, sou uitgewerk
gewees het.  Gevolglik kon ‘n gepoogde afstanddoening na die sperdatum nie
herlewing van die verpligting en die reg tot gevolg gehad het nie.”
[20]    The decision in Neethling v Klopper en Andere 1967(4) SA 459 (A) to which
the appellant’s counsel referred does not assist the appellant.  In that  case  it was
held that the revival of a contract for the sale of land which had been terminated by
waiver of the rights which arose from the termination of the contract did not have
to comply with the formal requirements of section 1(1) of the Act.   This case is
distinguishable from the present case in that it  concerned the revival of an existing
contract, not the creation of a contract where none previously existed.  Here no

contract came into being.
[21]    In any event there is no specific allegation in the papers, by the appellant, to
the effect that there was a waiver.   In so far as it may be inferred from the papers
that there was such a waiver, there is no indication or averment that such waiver
took place by any person authorised by the respondent to waive his rights.
As the option lapsed it was no longer available to be turned into a mineral lease.  In
consequence thereof, no subsequent non-notarial circumstances may be relied upon
by the appellant as amounting to a fresh notarially executed contract.  This is
especially so in the light of the provisions of s 3(1) of the Act.
[22]    The fact that the parties or even one of them believe that there was a valid
contract is irrelevant (Fuls v Leslie Chrome (Pty) Ltd and Another 1962(4) SA
784(W) at 787 C - E).  Part performance by either or both of the parties cannot
make up for the need for notarial execution. (Wilken v Kohler 1913 AD 135 at 142
and 143).   Furthermore the fact that royalty payments were  formally agreed upon
between the parties and that such payments were made and accepted without
objection is also irrelevant (Fuls’ case (supra) at 787 E - F, Jolly v Herman’s
Executors 1903 TS 515 at 522 and Pucjlowski v Johnston’s Executors 1946 WLD
1 at 3).   It is  trite that parties may not, by private agreement, derogate from, or vary
or waive statutory requirements which are not intended to be exclusively for their
benefit.  This is so because the formality required by the statutory requirement  set

out in s 3(1) was introduced as a matter of public policy, and not for the benefit of
any class of person for example lessors or lessees (cf Wilken’s case (supra) at 142,
Hersch v Nel 1947(3) SA 365 (O) at 369 and Fuls’ case (supra) at 787H - 788C).
[23]    I conclude therefore that the appellant did not enter into a valid enforceable
mineral lease with the respondent.
The appeal is accordingly dismissed with costs.
________________________
ZULMAN JA
STREICHER  JA
)
MELUNSKY  AJA
)
FARLAM  AJA
)CONCUR
MADLANGA  AJA
)