THE SUPREME COURT OF APPEAL OF SOUTH AFRICA
JUDGMENT

Not Reportable
Case no: 44/2021

In the matter between:

DANIEL FRANCOIS MALAN

APPELLANT

and

DIE GERHARD LABUSCHAGNE
FAMILIE TRUST
FIRST RESPONDENT

C & C DELWERYE CC
SECOND RESPONDENT

Neutral citation: Malan v Die Gerhard Labuschagne Familie Trust & Another
(Case no 44/2021) [2021] ZASCA 171 (9 December 2021)

Coram:
SALDULKER ADP, ZONDI, DAMBUZA and GORVEN JJA, and
SMITH AJA

Heard:
16 November 2021

Delivered: This judgment was handed down electronically by circulation to the
parties’ representatives by email, publication on the Supreme Court of Appeal
website and release to SAFLII. The date and time for hand-down is deemed to be
09h45 on 9 December 2021.

Summary: Sale – immovable property – subdivision of Remainder approved by
Surveyor-General – option to purchase one of the proposed subdivisions – option
exercised but transfer not effected –no real right in proposed subdivision to dispose
of – subsequent sale of unsubdivided property including proposed subdivision to
third party – third party taking transfer unaware of any claim to transfer of proposed
subdivision – rectification claimed of sale agreement and Title Deed to reflect sale
and transfer of consolidated property including proposed subdivision – such
rectification not competent – only personal right to transfer of proposed subdivision
could be disposed of since no transfer of proposed division had taken place – no
basis for title deed of third party to be ‘rectified’ to exclude proposed subdivision.

__________________________________________________________________
ORDER
______________________________________________________________________________
On appeal from: Gauteng Division of the High Court, Pretoria (Neukircher J, with
Louw J and Ally AJ concurring, sitting as full court):

The appeal is dismissed with costs, including those consequent upon the
employment of two counsel, wherever so employed.

__________________________________________________________________
JUDGMENT
__________________________________________________________________
Gorven JA (Saldulker ADP, Zondi and Dambuza JJA and Smith AJA
concurring)

[1] This appeal relates to the sale of immovable property. Various transactions,
which will be detailed below, gave rise to an application by the appellant (Mr Malan)
in the Gauteng Division of the High Court, Pretoria (the high court). Mr Malan
sought the following relief:1
1.
That the written sale agreement and Deed of Transfer of the Applicant, being Deed of
Transfer T18324/04, is rectified so that the property description in the said Deed of Transfer reads:
‘Portion 3 of Erf 25 of Schweizer Reneke Township, in extent 773 square metres.’

1 This is not a direct translation from the original Afrikaans in the notice of motion. It reflects the relief sought.

b)
That the property description of the second property in Deed of Transfer T95947/12 is
rectified to read:
‘Remainder of Erf 25 of Schweizer Reneke Township, in extent 2082 square metres.’
c)
That the Surveyor-General’s diagram LG9914/2001, annexure ‘J’ to the founding affidavit,
be reflected in the above mentioned rectified Deeds.
d)
Costs in the event of opposition.

[2] The trustees of the Gerhard Labuschagne Family Trust (the trust)2 opposed
the application as did C & C Delwerye CC (the CC). The CC launched a counter-
application for the eviction of Mr Malan. The relief sought by Mr Malan was granted
by Rabie J, who dismissed the counter-application. On appeal to the full court of that
Division, Neukircher J, in whose judgment Louw J and Ally AJ concurred, upheld
the appeal, set aside the order of Rabie J, and substituted an order dismissing the
application with costs and granting the order for eviction in the counter-application.
The appeal is before us by special leave of this Court.

[3] The relief sought on appeal is to similar effect but, since it differs slightly
from that reflected in the prayer to the notice of motion, it is best to set it out fully
as embodied in Mr Malan’s heads of argument. An order is sought:3
‘72.1 rectifying the property description in the written Deed of Sale dated 17 October 2003
between the appellant and the trustee in the insolvent estate of Irene Nel and the appellant’s
Title Deed number T18324/04 to read:
“Gedeelte 3 van Erf 25 van die dorp Schweizer Reneke, Groot 773 vierkante meter.”
72.2
rectifying the property description in Deed of Transfer T95947/12 to read:
“Restant van Erf 25 van die dorp Schweizer Reneke, Groot 2082 vierkante meter.”

2 Strictly speaking, all references should be to the trustees of a trust but, for the sake of convenience, I shall simply
refer to the trust.
3 This is the paragraph numbering in the heads of argument.

72.3
directing that the Surveyor General’s diagram in respect of the abovementioned immovable
properties, being LG 9914/2001, be incorporated in Deeds of Transfer T18324/04 and
T95947/12, as rectified;
72.4
dismissing the second respondent’s counter-application with costs;
72.5
directing the first and second respondents to pay the costs of the application jointly and
severally, the one paying the other to be absolved.’

[4] A brief chronology will assist in framing the issues. On 1 July 1998, the trust
took transfer of Erf 25 of the Town Schweizer Reneke, registration division H O,
North West Province, in extent 2855 square metres (Erf 25). On 17 September 1998,
permission was granted to subdivide Erf 25 into:
a)
Portion 1 of Erf 25 (portion 1), in extent 547 square metres;
b)
Remainder of Erf 25 (the remainder), in extent 2308 square metres.

[5] On 14 June 2000, one Irene Nel (Ms Nel) purchased portion 1 from the trust.
The agreement included an option to purchase part of the remainder on which stood
pigeon coops and a flat (the disputed property). The material terms relating to the
option were:
a)
The option would be valid for a period of 5 years with effect from 4 July 2000.
b)
The purchase price was R30 000, which amount would escalate by 10% per
annum for the period of the option.
c)
Should Ms Nel wish to exercise the option, she would give the trust written
notice by registered post of her intention to do so and would accord the trust a period
of six months to remove the existing pigeon coops from the disputed property.
d)
If the option was exercised, Ms Nel would then be responsible for subdividing
it from the Remainder and consolidating the disputed property with portion 1 at her
cost.

e)
Ms Nel was entitled to lease the flat on the disputed property from the trust
for a period of 5 years at an agreed rental of R500 per month, escalating at 10% per
annum.

[6] On 4 September 2000, portion 1 was transferred to Ms Nel. At the same time,
she took occupation of the disputed property. On 29 June 2001, Ms Nel wrote by
registered post indicating that she was exercising the option to purchase. On
16 November 2001, Ms Nel paid R30 000 to the trust. The trust issued a receipt
stating that this amount had been received in respect of the option.4 On
21 January 2002, the Surveyor-General approved a division, in terms of diagram
LG9914/2001, of the remainder into:
a)
Portion 2, in extent 226 square metres, which was the disputed property. When
consolidated with portion 1, the two would become portion 3.
b)
A remainder in extent 2082 square metres.
It is common cause that the disputed property was never transferred to Ms Nel and
was not consolidated with portion 1. As such, the remainder, registered in the Deeds
Office as being owned by the trust, was that of the original subdivision of Erf 25 in
1998, in extent 2308 square metres, which included the disputed property.

[7] On 4 November 2003, Ms Nel’s estate was finally sequestrated. During
November 2003, Mr Malan concluded a sale agreement with the trustee of Ms Nel’s
estate. The agreement described the property purchased as ‘Portion 1 of erf 25,
Schweizer-Reneke better known as 19 Du Plessis Street, Schweizer-Reneke.’5
During January 2004, Mr Malan took occupation of portion 1 and the disputed

4 On the receipt, the words ‘TOV Opsie per kontrak’ were written.
5 My translation. The original Afrikaans said: ‘Gedeelte 1 van erf 25 Schweizer-Reneke
Beter bekend as Du Plessis straat 19 Schweizer-Reneke.’

property. After January 2004, Mr Malan effected improvements to the disputed
property. This involved demolishing the pigeon coops and constructing a carport
next to the flat. On 4 February 2004, portion 1 was transferred to Mr Malan. The
Deed of Transfer described the property purchased as ‘Portion 1 of erf 25 of the
Town Schweizer Reneke; Registration Division H.O.; North West Province; Extent
547 (Five Hundred and Forty-Seven) Square Metres, Originally Transferred and Still
Held by virtue of Deed of Transfer No. T110703/2000 with Diagram L.G. No.
A9706/1998 which applies thereto.’6 This was accordingly a transfer of portion 1
alone.

[8] On 12 November 2012, the trust sold the remainder to the CC. This included
the disputed property which had never been transferred pursuant to the exercise of
the option. It was thus not the remainder approved in diagram LG9914/2001 by the
Surveyor General in January 2002, in extent 2082 square metres, which was sold to
the CC. It was the remainder, in extent 2308 square metres, after the original
subdivision of Erf 25 into portion 1 and the remainder in 1998.

[9] On 5 December 2012, the son of Ms Nel’s former husband and a member of
the CC visited Mr Malan and informed him that the CC had purchased the remainder.
He required Mr Malan to vacate the disputed property on pain of proceedings to
evict him. On 14 December 2012, the CC took transfer of the remainder. On
14 December 2014, Mr Malan approached the high court as mentioned above. This
prompted the counter-application by the CC for his eviction from the disputed
property.

6 My translation. The original Afrikaans was:
‘Gedeelte 1 van erf 25 Schweizer Reneke Dorpsgebied; Registrasie Afdeling H.O.; Noordwes Provinsie; Groot 547
(Vyf Honderd Sewe en Veertig) Vierkante Meter, Aanvanklik Oorgedra en Steeds Gehou kragtens Akte van Transport
No. T110703/2000 met Kaart L.G. No. A9706/1998 wat daarop betrekking het.’

[10] With that backdrop, the issues between the parties can be addressed.
Numerous points were raised. Not all of them need be decided. The first issue is
whether Ms Nel properly exercised the option. It was submitted by the trust that the
option was not properly exercised for three reasons. Firstly, it submitted that written
notice by way of registered post had not been given. This is not borne out by the
evidence. Secondly, it was submitted that, because payment was made more than a
year after the option was granted, the sum of R30 000 fell short of the amount
required. It should have been escalated by 10%. This, too, does not wash. The option
took effect on 4 July 2000. The requisite notice was given on 29 June 2001. The
option period, between the inception and when it was exercised, was accordingly
less than a year. No escalated price was claimable, nor did the trust make any such
claim at the time. Thirdly, the trust submitted that, in order to properly exercise the
option, Ms Nel had to take transfer of the disputed property and consolidate it with
portion 1 into portion 3. This, too, was not necessary on construction of the option.
Once exercised, the agreement provided that she was the one who had to take those
steps at her own expense, not that the option would not be exercised until she had
taken those steps.

[11] Two further points were ventilated. The first was whether Mr Malan had
proved sufficient facts to found a claim for rectification. Both the trust and the CC
submitted that this could not be decided in favour of Mr Malan on the papers. There
appears to be compelling evidence that the trustee of Ms Nel’s insolvent estate did
not know of the exercise of the option by Ms Nel. If this was so, she could not have
believed that Ms Nel was the owner of the disputed property. She might have thought
that the disputed property formed part of the property owned by Ms Nel, being
portion 1. It may be, therefore, that a claim for some form of rectification did not
have a factual basis. Due to the view I take of the matter, however, this point need

not be decided and I decline to do so. For present purposes, I shall assume in favour
of Mr Malan that the evidence supported a claim for rectification, albeit not
necessarily the one contended for by Mr Malan.

[12] The second point is the contention of the trust and the CC that any claim
Mr Malan might have had to the disputed property, or any right relating to it, has
prescribed. This is disputed by Mr Malan. Once again, I take the view that this need
not be decided. For present purposes, I shall assume in favour of Mr Malan that
whatever claim he might have has not prescribed.

[13] Mr Malan submitted that Ms Nel had acquired a real right in the disputed
property. Our law applies the abstract theory for delivery of immovable property. In
order for delivery to take place pursuant to a real agreement such as the present one,
registration of transfer in the Deeds Office is necessary.7 Therefore, for her to have
acquired a real right in the disputed property, transfer would need to have been
registered in the Deeds Office. There is no dispute that this was never done. As such,
Ms Nel never became the owner of the disputed property. What she acquired was a
personal right against the trust. It was the right to demand transfer of the disputed
property and to consolidate it with portion 1 into portion 3. This much was conceded
by Mr Malan in argument.

[14] In summary, therefore, the following was the legal position at the time of the
insolvency of Ms Nel. She was the owner of portion 1. In addition, she had a personal
right to take transfer of the disputed property and, on transfer or thereafter, to
consolidate the disputed property with portion 1 into portion 3.

7 Legator McKenna INC and Another v Shea and Others [2008] ZASCA 144; 2010 (1) SA 35 (SCA) para 22; [2009]
2 All SA 45 (SCA).

[15] That being the case, the trustee of Ms Nel could not obtain better rights than
those of Ms Nel. The rights which devolved upon her were those enjoyed by Ms Nel
at the time of insolvency. This means that she could sell and transfer portion 1,
because this was owned by Ms Nel. In addition, she could dispose of the right to
demand transfer of the disputed property from the trust along with the right to
consolidate it, on transfer or thereafter, with portion 1 into portion 3. As I have
shown, the right to claim transfer of the disputed property is clearly a personal and
not a real right.8

[16] It is important to analyse the relief sought by Mr Malan. The prayer in
paragraph 72.1 of his heads of argument asks for rectification both of the Deed of
Sale and the Title Deed. The rectification sought of the Title Deed would reflect
Mr Malan as owner of both portion 1 and the disputed property. On that basis,
rectification would result in the legal position that ownership of the disputed
property was transferred to Mr Malan at the time of transfer.

[17] Any rectification of the agreement between Mr Malan and the trustee could
not create a real right in the disputed property. It could not result in his being the
owner otherwise the rights he would have derived from the trustee would have
extended beyond the rights which had devolved upon the trustee. The trustee at no
time sought transfer of the disputed property from the trust. The transfer to Mr Malan
likewise did not result from a demand for transfer of the disputed property from the

8 Our law recognises that one can sell property belonging to another. This was received into Roman-Dutch Law from
Roman Law. See Theron & Du Plessis v Schoombie (1897) 14 SC 192 at 198. All that need be given is vacuo possessio
which carries with it a warranty against eviction. Property owned by another can be vindicated in the hands of a
possessor unless the possessor can show that a person authorised by the owner granted possession and that permission
has not been lawfully revoked. See Chetty v Naidoo 1974 (3) SA 13 (A) at 20. If the owner evicts, the seller must
make good the loss of the purchaser. However, in the present matter, the trustee could not deliver that property pursuant
to the sale, thus giving ownership, without the consent of the owner since delivery of immovable property takes place
by way of registration of transfer.

trust. Rectification could thus not result in Mr Malan becoming the owner of the
disputed property. This would be the effect of rectifying the Title Deed as claimed.
At best, any rectification, if made out, would result in a rectified agreement that
Mr Malan purchased portion 1 and the personal right to demand transfer from the
trust of the disputed property which could be consolidated, on transfer or thereafter,
with portion 1 into portion 3. This is not what Mr Malan claimed. Rectification, as
claimed by Mr Malan, reflecting the sale as being one of portion 3, comprising
portion 1 and the disputed property, and describing the property which had been
transferred as portion 3, could thus not be granted. For this reason, the appeal cannot
succeed.

[18] There is a further compelling reason why the relief sought by Mr Malan was
not competent. Because transfer to Ms Nel did not take place, the disputed property
continued to be owned by the trust as part of the remainder. This is what was
reflected in the Deeds Office at the time of the sale by the trust to the CC in 2012.
What was sold, and subsequently transferred to the CC, was the remainder created
by the original subdivision in 1998. The CC thus took transfer, and is the present
owner, of the disputed property. The CC has a real right in the remainder, including
in the disputed property.

[19] The prayer set out in paragraph 72.2 of Mr Malan’s heads of argument seeks
to amend the description of the property transferred from the remainder, reflected in
the 1998 diagram, in extent 2308 square metres, to describing the property
transferred as the remainder, reflected in the 2001 diagram, in extent 2082 square
metres. The effect of this prayer would accordingly be to deprive the CC of part of
a property owned by it.

[20] In circumstances where the remainder has been transferred, unless the CC had
knowledge of the right to claim transfer of the disputed property at the time of taking
transfer, the title of the CC to the disputed property is unimpeachable. The approach
to such a situation is found in the following dictum of this Court in Frye’s (Pty) Ltd
v Ries,9 dealing with a servitude:
‘If a servient tenement is sold, the buyer is bound by the servitude registered in favour of the owner
of the dominant tenement and it is immaterial whether he did or did not know of the existence of
the servitude. Knowledge of a servitude on the part of a buyer is material only when the servitude
has not been registered. If it has not been registered the buyer of the servient tenement is not bound
by the servitude unless he had knowledge of it when he bought.’
This is based on the principle that, until registered, an agreement to grant a servitude
is enforceable as between the parties to that agreement. The right to enforce the
servitude remains a personal right until the servitude is registered. That personal
right is enforceable against the person who granted it. It is not enforceable against
subsequent purchasers of the property unless they had knowledge of it at the time of
transfer. Once registered, it becomes a real right enforceable against the world. That
principle applies equally to the present matter where Ms Nel, and thereafter her
trustee, could have demanded the enforcement of the personal right to transfer of the
disputed property.10 Once she had taken transfer, she would have had a real right,
being ownership of the disputed property.

[21] The question of knowledge was dealt with earlier by this Court. In Grant and
Another v Stonestreet and Others,11 Ogilvie Thompson JA set out the legal position:

9 Frye’s (Pty) Ltd v Ries 1957 (3) SA 575(A) at 582C-D; [1957] 3 All SA 473 (A).
10 See Wahloo Sand BK en Andere v Trustees van die Hambly Parker Trust en Andere 2002 (2) SA 776 (SCA) paras
11-12.
11 Grant and Another v Stonestreet and Others 1968 (4) SA 1 (A) at 20A-C; [1968] 4 All SA 133 (A).

‘Having regard to our system of registration, the purchaser of immovable property who acquires
clean title is not lightly to be held bound by an unregistered praedial servitude claimed in relation
to that property. If, however, such purchaser has knowledge, at the time he acquires the property,
of the existence of the servitude, he will . . . be bound by it notwithstanding the absence of
registration.’
The underlying rationale of this approach is that, if a party has knowledge of
someone with a prior personal right concerning the property, and takes transfer
knowing of the prior personal right, that person would be bound despite lack of
registration. If, in the present matter, the CC had had knowledge of the right of
Ms Nel and her successor in title to take transfer at the time the CC took transfer, the
transfer to the CC could be set aside. Unless that was the case, the transfer to the CC
cannot be set aside.

[22] It cannot be said that the CC had knowledge of the personal right of Ms Nel
to transfer of the disputed property at the time it took transfer. This was conceded
by Mr Malan in argument. This means that the transfer to the CC of the remainder,
including the disputed property, cannot be set aside. The CC has a real right of
ownership of the disputed property. The title of the CC to the disputed property is
unimpeachable. The rectification sought is that the property which was transferred
to Mr Malan should be described as portion 3 of Erf 25. Such an order would have
the effect of excising the disputed property from the remainder which was lawfully
transferred to the CC. In other words, it would effectively result in setting aside the
transfer of that part of the remainder formed by the disputed property. There is no
claim for setting aside that transfer. As was submitted by the CC, the relief sought
by Mr Malan, if granted, would amount to a form of judicial expropriation. It is
certainly not competent to grant relief which has the effect of depriving the CC of
the disputed property purchased and paid for by it in good faith.

[23] The entire claim for rectification is premised on the assertion that Ms Nel had
acquired a real right in the disputed property. This would then mean that the disputed
property was consolidated with portion 1 into portion 3 since a certificate of
consolidation is not necessary under the Deeds Registries Act.12 This was not the
case made out on the papers. In any event, it is clear that the premise is flawed.
Unless Ms Nel became owner of the disputed portion, it could not have been
consolidated with portion 1. She did not obtain a real right and rectification could
not result in the sale and transfer of the consolidated property as claimed.

[24] The full court therefore arrived at the correct outcome. The appeal must be
dismissed. There is no dispute that costs should follow the result. Both Mr Malan
and the CC employed two counsel. In my view the costs of two counsel are
warranted, where two counsel were employed. In the result:
The appeal is dismissed with costs, including those consequent upon the
employment of two counsel, wherever so employed.

____________________
T R GORVEN
JUDGE OF APPEAL

12 See s 33 of the Deeds Registries Act 47 of 1937.

APPEARANCES

For appellant:

D van Loggerenberg SC (with I M Bredenkamp

SC)
Instructed by:
Pienaar Attorneys, Pretoria

Honey Incorporated, Bloemfontein

For first respondent:

A M Heystek SC
Instructed by:

Japie Van Zyl Attorneys, Pretoria

Symington & De Kok, Bloemfontein

For second respondent:
J D Maritz SC (with J G Van Der Merwe)
Instructed by:

Foster Attorneys, Pretoria

Symington & De Kok Attorneys, 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:
9 December 2021
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.

Malan v Die Gerhard Labuschagne Familie Trust & Another [2021] ZASCA 171

Today the Supreme Court of Appeal dismissed an appeal from the Full Court of the
Gauteng Division of the High Court, Pretoria (per Neukircher J, with Louw J and Ally
AJ concurring). The matter arose from various property transactions. An immovable
property, Erf 25 in Schweizer Reneke, was owned by Die Gerhard Labuschagne
Familie Trust (the trust). In 1998, it subdivided Erf 25 into Portion 1 (portion 1) and
the Remainder (the remainder). It sold portion 1 to one Ms Nel. It also leased to her,
and granted her an option to purchase, part of the remainder (the disputed property).
If she exercised the option, she was obliged at her own cost to subdivide the disputed
property from the remainder and, on taking transfer or thereafter, could consolidate
the disputed property with portion 1. Ms Nel exercised the option and had a diagram
reflecting a subdivision of the disputed property and the remainder approved by the
Surveyor General in 2004. She did not, however, take transfer of the disputed
property. As such, the disputed property continued to form part of the remainder
owned by the trust.

On her insolvency in November 2003, Ms Nel’s trustee sold portion 1 to Mr Malan,
the appellant. He took occupation of both portion 1 and the disputed property and,

thereafter, took transfer of portion 1. During 2012, the trust sold and transferred to
the Delwerye CC (the CC) the remainder. The CC was unaware that anyone else
claimed any rights in the disputed property. The deed of transfer reflected that the
CC became owner of the remainder which had originally been subdivided in 1998
since that property had throughout been owned by the trust. This because Ms Nel
did not take transfer of the disputed property after exercising the option. The CC
applied to evict Mr Malan from the disputed property. He, in turn, counter-applied to
rectify the sale agreement and the deed of transfer to him to reflect that what had
been sold and transferred to him was a consolidated property formed by portion 1
and the disputed property. The basis for this was that a common error had reflected
both the sale and the transfer as being of portion 1 whereas it ought to have reflected
a sale and transfer of the consolidated property formed by portion 1 and the disputed
property. Rabie J dismissed the application for eviction and granted the counter-
application of Mr Malan. The full court upheld an appeal against the order of Rabie J.

The counter-application was premised on Ms Nel having obtained a real right in the
disputed property, despite the accepted fact that she had not taken transfer. The
Supreme Court of Appeal held that Ms Nel’s right relating to the disputed property
was a personal right to take transfer since our system of registration requires transfer
in the deeds office in order to obtain ownership of immovable property. As such, the
rectification claimed by Mr Malan was not competent since, even if the facts showed
a basis for some form of rectification, it could not result in his obtaining better rights
than those which Ms Nel had enjoyed in the disputed property. Those were the rights
which devolved upon her trustee in insolvency and which could be transmitted to Mr
Malan. In addition, that form of rectification was not competent since it would amount
to depriving the CC of property transferred to it without its knowledge of any such
claim.

For these reasons, the Supreme Court of Appeal dismissed the appeal of Mr Malan
and upheld the order of the Full Court.