THE SUPREME COURT OF APPEAL
REPUBLIC OF SOUTH AFRICA

JUDGMENT

Case No:   43/2009

JACOBUS CORNELIUS SWANEPOEL                               Appellant

and

SUNNYBOY SOLOMON NAMENG                                  Respondent

Neutral citation: Swanepoel v Nameng (43/2009) [2009] ZASCA 101
(18 September 2009)

Coram:
Mthiyane, Nugent, Ponnan, Snyders JJA and Griesel
AJA

Heard:
1 September 2009
Delivered:
18 September 2009

Summary:
Agreement of sale of immovable property ─ property
incorrectly described but subsequently amended by the
parties ─ whether formalities prescribed by s 2(1) of the
Alienation of Land Act 68 of 1981 complied with ─
agreement subject to suspensive condition requiring bond
approval by certain date ─ whether suspensive condition
fulfilled.

_____________________________________________________________________

ORDER

On appeal from: Johannesburg High Court (Motloung AJ sitting as
court of first instance).

Save to the extent set out in paragraph 2 hereof, the appeal is
dismissed with costs.
The order in paragraph 5 that ‘costs of the application are to be
paid by the respondent on the scale as between attorney and client’ is set
aside and replaced with the following:
‘5 Costs of the application are to be paid by the respondent.’
___________________________________________________________

JUDGMENT

MTHIYANE JA (NUGENT, PONNAN, SNYDERS JJA and GRIESEL
AJA concurring):

[1] The issue in this appeal is whether an agreement of sale of
immovable property entered into between the parties is valid and if so,
whether the agreement lapsed for alleged failure to comply with the
suspensive condition contained in the agreement. The Johannesburg High
Court (Motloung AJ) held that the agreement complied with s 2(1) of the
Alienation of Land Act 68 of 1981 (‘the Act’) and that the suspensive
condition had been fulfilled.

[2] On 26 July 2006 the appellant sold to the respondent immovable
property described as erf 1172 Greenstone Hill, for the sum of R470 000.
The sale agreement was subject to a suspensive condition in terms of
which the respondent had to obtain approval of a loan by not later than 16

August 2006 against registration of a first mortgage loan over the
property. The agreement further provided that if the bond was not
approved by that date, an automatic extension of a further six working
days would be allowed to enable the estate agent to obtain the relevant
bond approval. Such extension thus allowed for fulfilment of the
suspensive condition by 24 August 2006.

[3] Subsequent to the approval of the loan on 18 August 2006 the
estate agent who brokered the sale between the parties discovered that the
property had been incorrectly described in the agreement as erf 1172
instead of 1173. The agreement was then amended by the parties on 22
August 2006 to reflect the property sold as erf 1173.

[4] Consequently it became necessary to also correct the loan
documentation at the bank to reflect the mortgaged property as erf 1173.
Accordingly the respondent was on application issued with a fresh
approval of the loan on 24 October 2006 in respect of erf 1173.

[5] In the meantime the estate agents had on 18 October 2006
instructed the conveyancers, Biccari Bollo Mariano Inc to proceed with
the transfer of the property into the respondent’s name. On 30 and 31
October 2006 the appellant and the respondent respectively signed
transfer documentation so as to effect transfer of the property to the
respondent.

[6] It appears that there was thereafter considerable delay in effecting
the transfer of the property. This prompted the appellant to write to the
respondent in July 2007 threatening to cancel the agreement on the
grounds of unreasonable delay. The concluding portion of the letter

contains the following ultimatum:
‘I hereby give you notice in terms of clause 9 of the offer to purchase to lodge the
transaction in the relevant deeds office within 10 days from the date hereof failing . . .
[which] . . . I will have to cancel this agreement. A copy of the letter will also be
addressed to the transferring attorneys.’

[7] The respondent wrote back to the appellant denying that he was to
blame for the delay and disputing the appellant’s right to cancel. On 2
August 2007 the respondent instructed the conveyancers, in view of the
dispute that had arisen, not to proceed with the transfer, until they
received further written instructions from him.

[8] By letter dated 18 August 2007 the respondent attempted to stave
off the cancellation, by reiterating that he was not to blame for the delay
and insisting that he had signed all the necessary transfer documents in
October 2006. This however failed to elicit any positive reaction from the
appellant. Similarly the conveyancer’s attempts to explain the delay met
with similar rebuff. The parties remained deadlocked.

[9] The deadlock culminated in an application to the Johannesburg
High Court in which the respondent sought an order declaring that the
appellant’s purported cancellation of the agreement was invalid and an
order to enforce specific performance. The appellant opposed the
application, at that stage, on two grounds. First, he contended that there
had been an unreasonable delay in effecting the transfer, which delay he
attributed to the respondent and the conveyancers. Second, the appellant
contended that even if a reasonable time had not elapsed for the transfer
of the property, he was entitled to avoid the agreement, because it had
lapsed for non-fulfilment of the suspensive condition contained in clause

13.1. The sub-clause provided that the respondent had to obtain approval
of a bond by not later than 24 August 2006.

[10] As already indicated the High Court found that the suspensive
condition had been fulfilled in that the home loan in respect of erf 1172
had been approved timeously. The learned judge held that the suspensive
condition had been fulfilled and that the agreement between the appellant
and the respondent was valid and binding and granted the relief claimed.
The appellant was consequently ordered to pay costs on an attorney and
client scale.

[11] With leave granted by this Court the appellant now appeals the
above ruling. The appellant’s challenge in the appeal stands on two legs.
First, it is contended that the agreement prior to its amendment was
invalid for failure to comply with the provisions of s 2(1) of the Act in
that the property sold (erf 1173) cannot be identified by reference to the
written agreement, as it was prior to the amendment. Second, and
alternatively, even if the agreement between the parties (in its unamended
form) complied with s 2(1) of the Act, it nevertheless lapsed because the
suspensive condition to which it was subject, was not timeously fulfilled.
This because approval of the loan in respect of the property erf 1173
(after the amendment) took place on 24 September 2006, whereas clause
13.1 of the agreement required that it occur by not later than 16 August
2006 or within the extended time provided for therein, that is 24 August
2006.

[12] Before discussing the appellant’s submission on the first point
relating to the alleged invalidity based on non-compliance with the
provisions of s 2(1) of the Act, it is necessary to quote the relevant

subsection and to make a few general observations. The subsection reads
as follows:
‘No alienation of land . . . shall . . . 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.’

[13] The subsection has been the subject of comment in a number of
decisions of this court and the high court. For purposes of the decision in
this case it is not necessary to embark on a comprehensive analysis of the
subsection because the issue raised by the respondent bears solely on the
description of the res vendita. The test for compliance with the subsection
as laid down by this court over the years is a simple one. If an immovable
property can be identified by reference to the terms of the agreement,
without recourse to evidence from the contracting parties as to their
negotiations and consensus, the provisions of law are met. (Clements v
Simpson 1971 (3) SA 1 (A) at 7F–G.) The subsection does not, however,
‘require a written contract of sale to contain, under pain of nullity,
faultless description of the property sold couched in meticulously
accurate terms’. [Emphasis added] (Headerman (Vryburg) (Pty) Ltd v
Ping Bai 1997 (3) SA 1004 (SCA) at 1009B.)

[14] The objective of the subsection is to achieve certainty in
‘transactions involving the sales of fixed property, as to the terms agreed
upon and thus avoid or minimise the possibility of . . . fraud or
unnecessary litigation’. (Intercontinental Exports (Pty) Ltd v Fowles 1999
(2) SA 1045 (SCA) at 1051D) ─ hence the requirement that all
agreements relating to the sale of land be reduced to writing and signed
by the parties thereto or by their agents on their written authority.

[15] In the present matter all the essential elements for the conclusion of
a valid agreement for the sale of land were present. The agreement was in
writing and signed by the parties thereto as required by the subsection.
More importantly there was reference in the parties’ agreement to an
identifiable property, (erf 1172) albeit in error. Thus standing alone, the
agreement sufficiently described the subject-matter sold to enable
identification of it on the ground. The purchase price of the property
(R470 000) was set out and so were details of how payment was to be
effected. Clearly, there was certainty on all the formal elements required
by the subsection. On the face of it therefore, the agreement of the parties
complied with the subsection.

[16] As the agreement of sale on the face of it complied with s 2(1) of
the Act, it was permissible for it to have been amended or rectified, by
substituting the correct description of the property sold (Magwaza v
Heenan 1979 (2) SA 1019 (A).) Intercontinental Exports (Pty) Ltd v
Fowles 1999 (2) SA 1045 (SCA) para 10.) It therefore follows that the
determination of the question whether the formalities prescribed by the
subsection have been complied with does not involve an enquiry into the
intention of the parties as to the property sold. Indeed the section makes
no reference to intention. By omitting any reference to intention in
respect of the property sold the legislature was, I think, mindful of the
fact that the parties could still amend their agreement by, for example,
exercising their common law right to rectify it, if they so wish, or make
whatever corrections they consider necessary. At the stage of determining
whether the formalities prescribed in s 2(1) of the Act have been
complied with one is therefore not concerned with the question whether
the property identified in the agreement as the res vendita, is in fact the
property that the parties intended to sell to each other ultimately. The

appellant’s argument seems to be that in order to comply with s 2(1) of
the Act the agreement had to reflect the property sold as erf 1173 from
the outset. The argument ignores the fact that the parties are as a matter of
law entitled to amend or rectify their agreement once a valid agreement
was concluded and the section does not impose any bar to this. The fact
that the agreement had to comply with the formalities prescribed by s 2(1)
of the Act did not mean that the description of the property could not be
corrected or rectified at any later stage. The remarks of Smalberger JA in
Intercontinental Exports are apposite:
‘Rectification is a well established common-law right. It provides an equitable
remedy designed to correct the failure of a written contract to reflect the true
agreement between the parties to the contract. In thereby enables effect to be given to
the parties’ actual agreement. . . ’.( at para 11).

[17] For the above reasons I conclude that the agreement of sale entered
into between the appellant and the respondent complies with the
requirments of the Alienation of Land Act and was valid even prior to the
amendment of the property sold from erf 1172 to erf 1173. The
appellant’s contention that the agreement did not comply with the
provisions of s 2(1) is without merit.

[18] I turn to the appellant’s second point. The appellant argues that the
suspensive condition was not fulfilled in that in terms of clause 13.1 the
bond in respect of the property sold was not approved before 16 August
2006 or within the automatic extension period (24 August 2006). Because
the respondents only succeeded in obtaining approval of a home loan in
respect erf 1173 on 27 September 2006, the appellant submits that the
agreement had by then lapsed in terms of clause 14.2.

[19] In my view when the respondent’s application for a loan was
approved and the bank furnished its guarantee in relation to erf 1172 the
suspensive condition was fulfilled, that being the necessary step to render
what was previously an inchoate agreement complete. Once that occurred
the agreement was valid and enforceable. The only remaining obstacle to
the enforcement of the agreement in respect of erf 1173 at that stage was
the incorrect description of the property sold as erf 1172 instead of erf
1173. The parties put paid to that by amending the agreement. The
suspensive condition in clause 13.1 (that had already been fulfilled) was
not all of a sudden revived by the granting of a home loan in respect of
erf 1173. In any event that is how the parties saw the situation. In my
view the fact that on 30 and 31 October 2006 the parties signed transfer
documents to give effect to the transfer of the property into the name of
the respondent supports this conclusion. When transfer was not effected
by July 2007 the respondent threatened to cancel the agreement on the
grounds of unreasonable delay. Why, if one may ask rhetorically, would
he do so if he regarded the agreement as having lapsed? The answer must
surely be that both parties regarded the suspensive condition as having
been fulfilled.

[20] To this may be added the fact that it probably mattered little to the
bank whether the loan was in respect of erf 1172 or erf 1173. The
application for a loan in respect of erf 1173 was in my view, merely a
means by which the bank was putting its loan documentation in line with
the corrected description of the property sold. Being a bank it could not
do it in any other way. A mortgage bond had to be registered over erf
1173 to secure the loan ─ an act which could hardly be viewed as
reviving a suspensive condition that had already been fulfilled.

[21] For the above reasons I conclude that the suspensive condition had
been fulfilled by the time the description of the property was corrected
and the argument to the contrary is without merit.

[22] I turn to the question of costs. It is not clear why the appellant was
ordered to pay costs on an attorney and client scale. Counsel for the
respondent was unable to support this aspect of the judgment. It appears
that the judge took umbrage at the appellant for taking points which he
had not raised initially when he sought to cancel the agreement. I do not
think that there was any justification for penalising the appellant for
acting in the manner that he did if he considered this to advance his case.
His actions do not amount to abuse of the process of court. Accordingly a
punitive costs order was not justified and falls to be set aside.

[23] Accordingly the following order is made:
1.
Save to the extent set out in paragraph 2 hereof, the appeal is
dismissed with costs.
2.
The order in paragraph 5 that ‘costs of the application are to be
paid by the respondent on the scale as between attorney and client’ is set
aside and replaced with the following:
‘5 Costs of the application are to be paid by the respondent.’

____________________

KK MTHIYANE

JUDGE OF APPEAL

Appearances:

For Appellant:
JM Kilian

Instructed by:

Victor & Partners Johannesburg

Symington & De Kok Bloemfontein

For Respondent:
NPG Redman

Instructed by:

Kgokong Nameng Tumagole Inc Johannesburg

Lovius Block Bloemfontein

THE SUPREME COURT OF APPEAL
REPUBLIC OF SOUTH AFRICA

MEDIA SUMMARY – JUDGMENT DELIVERED IN THE SUPREME COURT OF APPEAL

18 September 2009

STATUS:
Immediate

JC Swanepoel v SS Nameng (43/2009)[2009] ZASCA 101 (18 September 2009)

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

The SCA today dismissed an appeal by Mr Jacobus Cornelius Swanepoel against a
judgment of Motloung AJ sitting in the Johannesburg High Court. The learned judge
had granted an order declaring valid and binding an agreement which Mr Swanepoel
had entered into with Mr Sunnyboy Solomon Nameng for the sale of certain
immovable property, being erf 1173 of Greenstone Hill, to Mr Nameng.

Mr Swanepoel sought to avoid the agreement by asserting that the agreement was not
valid because the property was initially incorrectly described as erf 1172 instead of erf
1173.

The SCA rejected his argument and held that all the essential elements of a valid sale
of land on the face of the written agreement had been complied with, and that the
agreement complied with the provisions of s 2(1) of the Alienation of Land Act 68 of
1981.

The further argument by Mr Swanepoel that the agreement had lapsed because a
suspensive condition in the agreement which required the approval of a bank loan to
have been secured by Mr Nameng by a particular date had not been satisfied, was also
rejected by the SCA. The loan had been approved timeously and in compliance with

the agreement in relation to erf 1172. But the amendment of the description of the
property from erf 1172 to erf 1173, had the effect that Mr Nameng had to make a
fresh application for a loan, which was approved after the deadline. The SCA held
that once the suspensive condition had been fulfilled in relation to erf 1172 the
inchoate agreement had become complete. And thereafter once the agreement was
amended to reflect the correct erf, it was enforceable as against Mr Swanepoel. Mr
Swanepoel’s appeal was accordingly dismissed.