THE SUPREME COURT OF APPEAL OF SOUTH AFRICA
JUDGMENT

Case No: 35/12

Reportable

In the matter between:

Transnet Limited
First Appellant

and

Tatise Jackson Tebeka
First Respondent

Nelson Mandela Bay Metropolitan Municipality
Second Respondent

Evelyn Tebeka
Third Respondent

Neutral citation:
Transnet Limited v Tatise Tebeka & others (35/12) [2012]
ZASCA 197(30 November 2012)

Coram:
MTHIYANE DP, SHONGWE JA, SOUTHWOOD, PLASKET
AND MBHA AJJA

Heard:
22 November 2012

Delivered:
30 November 2012

Summary:
Prevention of Illegal Eviction from and Unlawful Occupation of Land Act
19 of 1998 (PIE) – whether first and third respondents unlawful occupiers of
house – house occupied in terms of agreement of sale between appellant
and first respondent – first respondent in default – appellant failed to
establish that notice of rescission communicated to him – agreement not
cancelled – first and third respondents not unlawful occupiers.

________________________________________________________________

ORDER
________________________________________________________________

On appeal from: Eastern Cape High Court, Port Elizabeth (Tshiki J sitting as
court of first instance):
The appeal is dismissed with costs.
________________________________________________________________
JUDGMENT
________________________________________________________________

PLASKET AJA (MTHIYANE DP, SHONGWE JA, SOUTHWOOD and MBHA
AJJA concurring)

[1] Applications for the eviction of people from their homes in terms of the
Prevention of Illegal Eviction from and Unlawful Occupation of Land Act 19 of
1998 (PIE) invariably raise a two-way tension between the interests of
landowners and those in occupation of property and under threat of eviction.1

[2] These tensions certainly arise in this appeal from the Eastern Cape
High Court, Port Elizabeth (Tshiki J) in which the application of the appellant
(Transnet) for an order, in terms of PIE, for the eviction of the first and third
respondents (Mr and Mrs Tebeka) from a house owned by Transnet was
dismissed with costs. The second respondent, the Nelson Mandela Bay
Metropolitan Municipality, did not oppose the application, filed no papers and
took no part in the proceedings. The appeal is before this court with the leave
of Tshiki J.

[3] The court below dismissed the application because it found that it had
not been established that Mr and Mrs Tebeka were unlawful occupiers for
purposes of PIE, having decided what it identified as a dispute of fact as to
whether Mr Tebeka had paid for the house in his favour. Secondly, it held

1 Port Elizabeth Municipality v Peoples Dialogue on Land and Shelter & others 2000 (2) SA
1074 (SE) at 1081D-E. See too Sandra Liebenberg Socio-Economic Rights (2010) at 271.

that, even if it was wrong in this respect, it would not, in the circumstances, be
just and equitable to evict the Tebekas.

The legal context

[4] The interests of property owners and those under threat of eviction are
both catered for in the Constitution. Section 25(1) of the Constitution provides
that „[n]o one may be deprived of property except in terms of law of general
application, and no law may permit arbitrary deprivation of property‟, while s
26(3) states that „[n]o one may be evicted from their home, or have their home
demolished, without an order of court made after considering all relevant
circumstances‟ and that „[n]o legislation may permit arbitrary evictions‟.

[5] In its preamble PIE refers to both of these provisions before stating that
it „is desirable that the law should regulate the eviction of unlawful occupiers
from land in a fair manner, while recognising the right of land owners to apply
to a court for an eviction order in appropriate circumstances‟.

[6] Section 4 of PIE is central to why, how and when persons may be
evicted from land on which they live. Section 4(1) provides, in the first place,
that, generally speaking, the section applies „to proceedings by an owner or
person in charge of land for the eviction of an unlawful occupier‟. Sections
4(2) to 4(5) prescribe procedures for the initiation of an application for eviction
and ss 4(6) and (7) provide for the way in which courts are to consider the
merits of applications to evict persons who have been in occupation of land
for less than six months and more than six months respectively.

[7] This case concerns occupiers who have been in occupation for longer
than six months. Section 4(7) states that „a court may grant an order for
eviction if it is of the opinion that it is just and equitable to do so, after
considering all the relevant circumstances, including . . . whether land has
been made available or can reasonably be made available by a municipality
or other organ of state or another land owner for the relocation of the unlawful

occupier, and including the rights and needs of the elderly, children, disabled
persons and households headed by women‟.

[8] In order for a person to be liable to eviction, he or she must be an
„unlawful occupier‟ of property. That term is defined in s 1 to mean „a person
who occupies land without the express or tacit consent of the owner or person
in charge, or without any other right in law to occupy such land . . .‟.2 An
owner is defined as „the registered owner of land, including an organ of state‟
and consent means „the express or tacit consent, whether in writing or
otherwise, of the owner or person in charge to the occupation by the occupier
of the land in question‟. Although this is not expressly stated in PIE, it only
applies to evictions from dwellings – the homes of persons – and not to
evictions from land used for commercial purposes or for holiday purposes.3

The facts

[9] It is common cause that Transnet is the registered owner of the house
situated at 76 Cerus Street, Motherwell, Port Elizabeth; that this property is
the home of Mr and Mrs Tebeka, their unemployed son and daughter and her
minor child; and that the Tebekas have resided in the home since July 1989 at
least. The proceedings to evict them were instituted in February 2010, after
they had lived in the home for over 20 years.

[10] Mr Tebeka had been an employee of Transnet. In July 1989, as part of
Transnet‟s house ownership scheme for its personnel, it had acquired the
property and had sold it to him. The most important terms of the agreement of
sale were that: (a) the purchase price would be R47 407.78; (b) Mr Tebeka‟s
indebtedness to Transnet would be paid in equal monthly instalments over a
period of 38 years; (c) ownership of the property would remain vested in
Transnet until Mr Tebeka had paid his indebtedness to it, at which point
Transnet would issue him with a deed of grant; (d) the monthly instalments

2 As to this definition and the meaning of „consent‟ see Residents of Joe Slovo Community,
Western Cape v Thubelisha Homes & others 2010 (3) SA 454 (CC) paras 36-39 and 54-71.
3 Ndlovu v Ngcobo; Bekker & another v Jika 2003 (1) SA 113 (SCA) para 20; Barnett & others
v Minister of Land Affairs & others 2007 (6) SA 313 (SCA) paras 37-40.

would be paid to Transnet from Mr Tebeka‟s salary; and (e) in the event of Mr
Tebeka leaving Transnet‟s employ, his pension being insufficient to settle the
amount outstanding and him failing to settle the balance on demand, Transnet
would be entitled to cancel the agreement.

[11] In December 1999, Mr Tebeka was dismissed by Transnet and his
pension was allocated to the settlement of what was owed on his home. This
was insufficient to pay the full amount outstanding. Despite this, Transnet
appears not to have taken any steps to enforce its rights for close to a
decade. Mr Tebeka paid nothing to Transnet during this period.

[12] According to the deponent to the founding affidavit, Mr Johan van der
Spuy, Transnet‟s manager: collections, Transnet‟s attorneys wrote a letter
dated 19 October 2009 to Mr Tebeka to inform him that he had not paid his
monthly instalments on the house and that as a result, he was in arrears in
the amount of R95 635.44. The letter stated that he was required to either
settle his indebtedness or make suitable arrangements to do so and to
communicate his intentions by 15 November 2009, failing which the
agreement of sale would be cancelled.

[13] According to Mr van der Spuy, on 26 November 2009, the same
attorneys sent a further letter to Mr Tebeka in which they recorded that they
had received no reply to their previous letter and informed him of the
cancellation of the agreement of sale. The letter concluded as follows:
„As a consequence of the cancellation effected herein, your continued occupation
has become unlawful and accordingly we hereby request you to vacate the premises
by no later than 31 DECEMBER 2009, and to contact our offices in order to make
adequate arrangements with regards to the delivery of the keys. We confirm our
instructions to make an application for your eviction, should you fail to adhere to our
request herein.‟

[14] Mr and Mrs Tebeka denied having received either of these letters. The
words „PER REGISTERED MAIL‟ appear on the face of each letter but no
registered mail slips were attached to the papers to establish that they were

indeed posted and delivered to the post office nearest the Tebekas‟ home. No
affidavit was filed by the attorney who purportedly wrote the letters to confirm
that he wrote them or that he attended to their postage by registered mail. Mr
van der Spuy‟s assertions that the attorney wrote them and posted them is
inadmissible hearsay. Furthermore, the issue was not dealt with at all in reply,
which one would have expected, given the Tebekas‟ denial. In these
circumstances, the Tebekas‟ denial that they received these letters must
prevail in accordance with the well-known rule in Plascon-Evans Paints Ltd v
Van Riebeeck Paints (Pty) Ltd.4

[15] Mr Tebeka stated that he had initially believed that his pension had
paid his indebtedness on the house in full. He later thought he only owed
R5 000, was under the impression that a housing subsidy from the provincial
government had been obtained on his behalf and that this amount had been
credited to his account to pay his debt in full. It appears from a statement of
account put up by Transnet in reply to these allegations, however, that
nothing was paid into his account after his pension was allocated to it on 14
July 2000. At that stage a balance of R23 974.21 remained. On 25 January
2008, the last date reflected on the statement of account, the balance is
reflected as being R40 373.42. (How that amount escalated to R95 635.44 by
1 October 2009 is not explained by Mr van der Spuy and, I venture to
suggest, probably cannot be explained.)

[16] Be that as it may, I am prepared to accept for present purposes that Mr
Tebeka was in arrears and that the statement of account reflected accurately
what he owed on 25 January 2008.

The issue

[17] On the basis of the facts set out above (including the assumption that I
have made in favour of Transnet that Mr Tebeka had not paid in full for the
house), I turn now to the central issue in this matter, whether Transnet

4 Plascon-Evans Paints Ltd v Van Riebeeck Paints (Pty) Ltd 1984 (3) SA 623 (A) at 634H-I.

cancelled the agreement of sale, thus terminating any right in law that the
Tebekas had to occupy the house and thereby rendering them unlawful
occupiers for purposes of PIE.

[18] How a creditor may cancel a contract on the basis of a debtor‟s non-
performance will depend on the terms of the contract and, in some cases, the
nature of the obligation involved. A contract may contain a forfeiture clause (or
lex commissoria) – a clause to the effect that if a party fails to perform an
obligation by a set date, the other party may cancel, or a provision that
requires performance of an obligation by a set date coupled with a statement
that time is of the essence. In either event, the contract may be cancelled
forthwith when the date for performance has passed and performance has not
occurred. If a contract contains no such provisions, it may be inferred from the
nature of the transaction and the facts that time is of the essence, and
cancellation may also be effected forthwith. This is, in truth, a tacit forfeiture
clause. Finally, where no express or tacit forfeiture clause forms part of the
contract and time is not of the essence, an innocent party may make time of
the essence. This is done by giving the party in default a notice of rescission –
a demand that if the non-performance is not remedied by a specified date, the
contract will be cancelled.5

[19] The position in the last category of cases was set out thus by Wessels
JA in Breytenbach v Van Wijk:6
„Immediate performance having been impossible and not contemplated, and no date
for transfer having been fixed by the contract, the respondent, if he considered that
sufficient time had elapsed to enable him, on that ground, to procure his own release
should have taken steps – as the civilians express it – to place the appellant in mora
by demanding that transfer should be passed on or before a specified date,
reasonable under the circumstances. . . Not having placed the appellant in mora the

5 Birkenruth Estates (Pty) Ltd  v Unitrans Motors (Pty) Ltd (formerly Malbak Consumer
Products (Pty) Ltd) & others 2005 (3) SA 54 (W) para 17; R H Christie and G B Bradfield
Christie’s The Law of Contract in South Africa 6 ed (2011) at 527-530; Francois du Bois,
Graham Bradfield, Chuma Himonga, Dale Hutchinson, Karin Lehmann, Rochelle le Roux,
Mohamed Paleker, Anne Pope, C G van der Merwe and Daniel Visser Wille’s Principles of
South African Law 9 ed (2007) at 860-861.
6 Breytenbach v Van Wijk 1923 AD 541 at 549.

respondent was not entitled to sue for cancellation of the contract merely because in
his opinion transfer was not effected within a reasonable time.‟

[20] The issue was analysed in detail, in two separate judgments of this
court, in Nel v Cloete.7 In a minority judgment ( in which he only differed from
the majority on a factual issue) Jansen JA made the point, with reference to
Breytenbach’s case, that despite the use of the term mora in the passage
cited above, „is dit moeilik om die gevolgtrekking te vermy dat die geleerde
Regter hier basies die Engelse “notice of rescission” in gedagte het‟.8

[21] In the majority judgment of Wessels JA, the following is stated
concerning the way in which a party may cancel a contract on the basis of the
other party‟s non-performance:9
„Daar bestaan, na my mening, geen rede waarom versoening tussen die twee
regstelsels bewerkstellig behoort te word deur die tydperk vir vervulling wat 'n “notice
of rescission” in Engelse reg beoog, eenvoudig by die tydperk, wat intrede van mora
volgens Romeins-Hollandsereg voorafgaan, aan te las nie. Waar dit, soos hierbo
aangedui is, volgens ons regspraak beoog is dat in bepaalde omstandighede die
intreding van mora 'n bykomstige regsgevolg het, nl., die ontstaan van 'n
terugtredingsreg, indien 'n “notice of rescission” aan die skuldenaar gerig is, verval
die praktiese noodsaaklikheid om op twee aparte kennisgewings aan te dring.
Wanneer 'n skuldeiser, soos hy geregtig is om te doen, die skuldenaar aanmaan om
op of voor 'n sekere dag te voldoen, kan hy gerieflik in dieselfde kennisgewing
meedeel dat, by gebreke aan voldoening binne die gestelde tydperk, hy hom die reg
voorbehou om uit die kontrak te tree. . . Dit kan, wat die skuldenaar betref, nie
onbillikheid in die hand werk nie; hy word 'n redelike geleentheid gegun om sy
verpligting ooreenkomstig die kontrak te vervul. Dit kan nie gesê word dat 'n
skuldeiser langs hierdie weg deur eensydige optrede 'n lex commissoria aan die
skuldenaar opdring nie. Waar 'n geskil ontstaan aangaande die redelikheid, al dan
nie, van die gestelde termyn, word dit deur 'n hof beoordeel na gelang van al die
betrokke omstandighede. Slegs waar 'n skuldeiser redelik optree wat die
kennisgewing betref, kan mora intree, en slegs dan kan 'n terugtredingsreg

7 Nel v Cloete 1972 (2) SA 150 (A).
8 At 172E-F.
9 At 163D-H.

uitgeoefen word. By koopkontrakte staan dit die partye vry, indien hulle verkies, om
te beding dat prestasie nie voor 'n bepaalde dag geverg kan word nie.‟

[22] The agreement of sale in this case contains no express or tacit
forfeiture clause and nor can it be inferred from the nature of the transaction
and the facts that time is of the essence. In order to place itself in a position to
cancel in due course on account of Mr Tebeka‟s failure to comply with what
was certainly a material term, therefore, Transnet had to make a demand of
Mr Tebeka, calling on him to comply within a specified period, reasonable in
the circumstances, failing which the contract would be cancelled.

[23] As to the purpose of the notice of rescission, Kotze JA, in West Rand
Estates Ltd v New Zealand Insurance Co Ltd,10 said that „we must bear in
mind that a defendant cannot be said to be in mora unless he knows the
nature of his duty or obligation; that is to say when and how much he has to
pay‟. From this, it follows that „it is the receipt, not the dispatch, of the demand
that matters‟.11

[24] Transnet has not established that the notice of rescission that was
allegedly written by its attorneys was ever communicated to Mr Tebeka. It was
consequently not in a position to cancel the agreement of sale, and
consequently never did so. That being so, it has not been established that the
Tebekas did not have a right in law to occupy the house. They are not
unlawful occupiers for purposes of PIE and are therefore not liable to be
evicted. The appeal must fail.

10 West Rand Estates Ltd v New Zealand Insurance Co Ltd 1926 AD 173 at 195.
11 Christie and Bradfield (note 5) at 526. Swart v Vosloo 1965 (1) SA 100 (A) at 114H-115E.

The order

[25] The following order is made.
The appeal is dismissed with costs.

__________________
C Plasket
Acting Judge of Appeal

APPEARANCES:

For appellant:
B Pretorius

Instructed by:

Greyvensteins, Port Elizabeth

Steyn Meyer Inc., Bloemfontein

For respondents:
L Crouse

Instructed by:

Legal Aid, Port Elizabeth

Legal Aid, Bloemfontein

THE SUPREME COURT OF APPEAL
REPUBLIC OF SOUTH AFRICA

MEDIA SUMMARY – JUDGMENT DELIVERED IN THE SUPREME COURT OF APPEAL

From:
The Registrar, Supreme Court of Appeal
Date:
30 November 2012
Status:
Immediate

Please note that the media summary is intended for the benefit of the media and does not
form part of the judgment of the Supreme Court of Appeal.

Transnet Limited v Tatise Tebeka & others

Today the Supreme Court of Appeal (SCA) dismissed an appeal by the appellant with
costs and upheld the order of the Eastern Cape High Court, Port Elizabeth in favour of the
respondents.

The issue before the SCA was whether the cancellation of an agreement of sale by the
appellant, thus terminating any right in law that the respondents had to occupy a
residential property, rendered them unlawful occupiers for the purposes of the Prevention
of Illegal Eviction from and Unlawful Occupation of Land Act 19 of 1998 (PIE).

The first respondent had been an employee of the appellant. In 1989, as part of the
appellant’s house ownership scheme for its personnel, it had acquired the property and
sold it to the first respondent.

It was common cause that the appellant is the registered owner of the house in which the
respondents, together with their unemployed son and daughter and her minor child, lived.
The respondents have resided in the home since July 1989.  The proceedings to evict

them were instituted in February 2010, after they had lived in the home for over 20 years

In 1999, the first respondent was dismissed by the appellant and his pension was
allocated towards settlement of what was owed on his home. It was the appellant’s case
that this allocation was insufficient to discharge the full amount outstanding. The appellant
alleged that two letters were then sent to the first respondent demanding that he settle his
indebtedness failing which the agreement of sale would be cancelled. The respondents
denied receiving either of these letters.

The SCA held that the appellant had not established that the notice of rescission was ever
communicated to the first respondent. The appellant was consequently not in a position to
cancel the agreement of sale, and consequently never did so.

The SCA held further that, this being so, it had not been established that the first and third
respondents did not have a right in law to occupy the house, and that therefore they were
not unlawful occupiers for purposes of PIE and were not liable to be evicted.