THE SUPREME COURT OF APPEAL OF SOUTH AFRICA

JUDGMENT

Not reportable

Case No: 20049/14

In the matter between:

ROOYENDAL (PTY) LTD

FIRST APPELLANT
MARK WILLIAM BOSHOFF

SECOND APPELLANT
SENTA BOSHOFF

THIRD APPELLANT
EDSEL HOHLS

FOURTH APPELLANT
I R VOIGTS (PTY) LTD

FIFTH APPELLANT
WALTER HERBERT REDINGER

SIXTH APPELLANT
HEINZ FRIEDEL REDINGER

SEVENTH APPELLANT

and

THE MINISTER OF LAND AFFAIRS

FIRST RESPONDENT
TABATHA AGATHA SHANGE

SECOND RESPONDENT

Neutral Citation: Rooyendal (Pty) Ltd v The Minister of Land Affairs

(20049/14) [2015] ZASCA 108 (21 August 2015).

Coram:
Mpati P, Lewis and Bosielo JJA and Van der Merwe and

Gorven AJJA

Heard:
18 May 2015

Delivered:
21 August 2015

Summary:
Contract ─ appellants failed to prove oral agreements relied
upon ─ oral agreements relied upon by first and seventh appellants in any
event unenforceable as result of integration (parol evidence) rule.

______________________________________________________________

ORDER
______________________________________________________________

On appeal from: Land Claims Court, (Sardiwalla AJ sitting as a court of first
instance in KwaZulu-Natal): judgment reported sub nom Rooyendal (Pty) Ltd
v Minister of Land Affairs [2013] 3 All SA 588 (LCC).
The appeal is dismissed with costs, including the costs of two counsel.
______________________________________________________________

JUDGMENT
______________________________________________________________

Bosielo JA and Van der Merwe AJA (Mpati P, Lewis JA and Gorven AJA
concurring):

[1] The Amakhabela and Ntunjambili/Ngcolosi communities lodged land
claims in terms of the Restitution of Land Rights Act 22 of 1994 (the Act), in
respect of a number of farms in the Kranskop region of KwaZulu-Natal. The
communities claimed inter alia restoration of farms owned and farmed by the
first and seventh appellants. They also claimed restoration of farms leased
from their owners by a partnership consisting of the second and third
appellants and by the fourth, fifth and sixth appellants. These farms were
owned by family trusts. The trustees of the respective family trusts included
the second, third, fifth and sixth appellants as well as Mr Ivan Voigts, the
managing director of the fifth appellant. An attorney, Ms Karen Hepburn, was
a trustee of a number of these family trusts. The principal farming operations
on these farms were the production of timber and sugar-cane.

[2] At all relevant times the second respondent, Ms Tabatha Shange, was
employed by the Department of Land Affairs (the department) as Regional
Lands Claims Commissioner for KwaZulu-Natal. She caused notices of the
claims to be published in the government gazette during 2003. The owners of
the farms referred to in the previous paragraph (the farms) opted to sell and
commenced negotiations for that purpose with Ms Shange on behalf of the
communities. These negotiations were mainly conducted on behalf of the

appellants by the third appellant, Ms Senta Boshoff, the fourth appellant, Mr
Edsel Hohls, Mr Voigts and Ms Hepburn. Ms Shange was assisted by officials
of the department in KwaZulu-Natal.

[3] The farms were eventually sold to the department, represented by Ms
Shange, on behalf of the communities, in terms of nine written deeds of sale,
all entered into on 8 June 2005. The total consideration payable in respect of
the deeds of sale amounted to some R90 million. Apart from the description of
the farms and the purchase price thereof, the terms of the deeds of sale were
identical. Each agreement provided in clauses 2 and 5 that the farm or farms
and standing sugar-cane and/or timber were sold as a going concern. In
terms of clause 7 of each agreement occupation would be given to the
purchaser on the date of registration of transfer. Clause 8 contained the
following provisions:
‘8.1
This agreement constitutes the entire record of the contract between the
PARTIES. No agreement varying, adding to, deleting from or cancelling this
agreement, shall be effective unless reduced to writing and signed by or on behalf of
the PARTIES.
8.2
The PARTIES agree and warrant that:
8.2.1 there are no conditions precedent suspending the operation of this agreement
save as specifically set out in this agreement,
8.2.2 no warranties other than those contained in this agreement shall be of any
force and effect, and that no other warranties have been given or representations
made to the PURCHASER by the SELLER whereby the PURCHASER has been
induced to enter into this agreement.
8.2.3 This agreement replaces the terms and conditions of all preceding
negotiations, written or oral communication between the parties with regard to this
PROPERTY.’
Clause 22 thereof provided:
‘22.1
From the DATE OF SALE to the DATE OF TRANSFER, the SELLER shall
continue to farm the PROPERTY in accordance with recognised farming practices.
22.2
All proceeds during this period shall be for the SELLER’S account.’
Registration of transfer of the farms took place during September and October
2005.

[4] During the negotiations a series of meetings took place between the
parties, notably on 8 July 2004, 19 August 2004, 30 March 2005 and 6
September 2005. Minutes of these meetings were prepared by Ms Hepburn.
Although these minutes were forwarded to Ms Shange or her officials, they
never responded to them, not even acknowledging receipt. The minutes were
also not formally adopted at the respective subsequent meetings. It is notable,
too, that Ms Hepburn accepted that the minutes may have omitted various
matters discussed, and agreed that they were not verbatim recordings of what
was discussed.

[5] Relying to a large extent on these minutes, the appellants averred that
during the period from 8 July 2004 to 6 September 2005 each of them entered
into an oral agreement with the department, represented by Ms Shange, in
terms of which the department agreed to reimburse them for input costs
incurred in respect of their respective sugar-cane and/or timber plantations
during the period from September 2004 to January 2005. The input costs
consisted of the costs of fertilisers, weed-killers, insecticides and the like. The
appellants consequently instituted action in the Land Claims Court, claiming a
total amount of approximately R4,8 million in respect of these input costs.

[6] The second and third appellants, Mr and Mrs Boshoff, also claimed
payment of what was referred to as development costs. They alleged that
during the same period they entered into an oral agreement in terms of which
the department agreed to reimburse the costs of capital development of the
farm Spekfontein. According to the evidence these development costs related
to the construction of a shed, the propagation of seedlings and the
establishment of 60 hectares of timber and 30 hectares of sugar-cane.

[7] In evidence on behalf of the respondents it was acknowledged that
mention of reimbursement of input costs had been made at the meetings. Ms
Shange and other witnesses testified that reimbursement was mentioned
solely within the context of the possibility of post-transfer involvement of the
appellants in the farming operations of the communities. They denied that any
agreement was actually reached in respect of reimbursement of input costs

and denied that reimbursement of development costs was even the subject of
discussion. On behalf of the respondents it was also contended that these
claims were in any event excluded by the terms of the sale agreements.

[8] The Land Claims Court (Sardiwalla AJ) found that the appellants did
not prove the oral agreements relied upon on a balance of probabilities and
dismissed all their claims. Leave to appeal was granted by this court. The
issues in this appeal are therefore whether reliance on the alleged oral
agreements was excluded by the terms of the deeds of sale and, if not,
whether the finding of the court a quo that none of the alleged oral
agreements were proved, could be faulted. It is convenient to deal with the
first question at the outset since in our view it conveniently disposes of the
claims of the first and seventh appellants.

[9] The second to sixth appellants were not parties to any of the deeds of
sale in respect of the farms, even though some of them signed the respective
deeds of sale on behalf of the owner trusts. The terms of the deeds of sale
are not binding on the second to sixth appellants. They do, however, bind the
first and seventh appellants. The question, therefore, is whether the oral
agreements in respect of reimbursement of input costs relied upon by the first
and seventh appellants would in any event have been unenforceable because
of the application of the integration rule.

[10] As we will show, the evidence on behalf of the appellants was that the
oral agreements in respect of input costs had been entered into prior to the
conclusion of the deeds of sale. The question is thus whether the sale
agreements entered into by the first and seventh appellants were intended to
constitute the exclusive memorials of the agreements reached during the
negotiations between the respective parties.

[11] In our view, the terms of the deeds of sale made clear that that was the
case. In terms of clause 8.1 of the deeds of sale they constituted the entire
record of the contracts between the parties. These contracts related to the
sale of the farms and standing sugar-cane and/or timber as going concerns,

which were to be farmed for the account of the sellers until the date of transfer
of the farms. There can be no doubt that an agreement pertaining to
reimbursement of input costs incurred by the seller in respect of a farm prior
to its transfer, would constitute an addition to or variation of the deed of sale.
Any oral addition to, or variation of, the deed of sale was, in each case,
expressly rendered unenforceable by the second sentence of clause 8.1. This
is also clear from the provisions of clause 8.2.3. This clause provided that the
written agreement replaced the terms and conditions of all preceding
negotiations and communication between the parties with regard to the
immovable property sold. A preceding oral agreement for the reimbursement
of costs of the inputs made in respect of a farm, by the seller during the period
before transfer, would, in context, constitute a term of preceding negotiations
or communication and was thus replaced by the deed of sale.

[12] We therefore conclude that, even if the first and seventh appellants
were able to prove the alleged oral agreements, their claims were bad in law.
Whether these oral agreements were in fact proved, in so far as the other
appellants are concerned, is the question to which we now turn.

[13] It is trite that generally a contract is concluded when the acceptance of
an offer is communicated by the offeree to the offeror. It follows that a party,
wishing to rely on an agreement reached during oral negotiations, should
show when, where and how the acceptance of the terms of the agreement
was expressed by each of the parties to the agreement. The content of the
terms must also be clearly established.

[14] No viva voce evidence of a director or employee of the first appellant
was presented. The sixth and seventh appellants did not testify. We accept
that these appellants were represented during the relevant negotiations by Ms
Boshoff, Mr Hohls and Ms Hepburn. They gave evidence as to the conclusion
of the oral agreements in respect of reimbursement of input costs, as did Mr
Voigts. It is important to note that according to each of these witnesses the
oral agreements between the department and the appellants were concluded
on a single occasion.

[15] Mr Voigts said that binding agreements were concluded at the meeting
held on 8 July 2004. But this evidence cannot be accepted. One of the issues
raised during the negotiations between the parties was the possibility of
involvement of the appellants in arrangements in respect of utilization of the
farms for the benefit of the communities after the transfer thereof. These
possibilities were either lease agreements in terms of which the appellants
would hire the farms from their new owners (lease-back), or the establishment
of partnerships between the appellants and the communities in respect of the
farming operations on the farms. It is common cause that such post-transfer
involvement of the appellants was contemplated at the meeting of 8 July
2004. It was recorded in the minutes of the meeting that a precedent of a
memorandum of understanding in this regard would be forwarded to the
appellants and that a full day would be set aside for a future meeting to
address these matters. Thus, it was at least clear that the post-transfer
arrangements would be embodied in written agreements and that, in such
event, the appellants would not be reimbursed for input costs in terms of a
separate oral agreement. In addition, it is common cause that by 8 July 2004
it was expected that takeover of the farms would take place on 1 September
2004, that is, before the inputs in question would be made. For these reasons
binding agreements in respect of reimbursement of input costs for the period
September 2004 to January 2005 could hardly have been concluded at the
meeting of 8 July 2004. Both Ms Boshoff and Ms Hepburn expressly
conceded that binding agreements in respect of input costs were not reached
at this meeting. Both also conceded that no agreement was concluded at the
meeting of 19 August 2004.

[16] In his evidence, the fourth appellant, Mr Edsel Hohls, said that it had
been agreed with Ms Shange that the farms would be taken over on 1
September 2004. According to his initial evidence, reimbursement of the costs
of inputs actually made were not on the table for discussion before 1
September 2004. He said that as the fertilisers and other substances had to
be ordered in May and June of that year, the concern was about the costs of
these materials that had been ordered but would not have been used on
takeover. According to Mr Hohls, the response of Ms Shange was that these

would be taken over and paid for.  He stated that when takeover of the farms
did not take place on 1 September 2004, Ms Shange telephoned him during
the beginning of September 2004.  She requested him to ensure that all the
relevant farmers make the inputs and said that their costs would be paid. Mr
Hohls repeatedly testified that the agreements for reimbursement of input
costs were concluded during this telephone conversation. This was not put to
Ms Shange in cross-examination. In his later evidence, Mr Hohls said that on
8 July 2004, or perhaps even prior thereto, agreement had been reached that
the department would reimburse input costs if the farms were not taken over
by 1 September 2004. This version, of a conditional agreement reached
before 1 September 2004, not only constituted a material adjustment of his
evidence but was contradicted by the witnesses of the appellants that we
have mentioned.

[17] Ms Boshoff testified that she was unable to provide the date on which
the oral agreements were concluded. She did say, however, that they must
have been concluded prior to October 2004. Ms Hepburn, in turn, said that the
agreements were concluded at the meeting of 30 March 2005.

[18] Two advocates, Mr A J Rall SC and Mr A E Potgieter SC, testified for
the appellants. Both attended the meeting of 6 September 2005. Mr Rall
testified that his independent recollection was that at this meeting the
appellants received the undertaking or the confirmation of previous
undertakings from Ms Shange that the input costs would be paid on
production of invoices. Mr Potgieter had a similar recollection. But both
formed the impression that the undertaking to reimburse input costs also
related to the period after January 2005. Mr Rall said that the undertaking
related to input costs incurred up to 30 January 2005 and subsequently, and
Mr Potgieter said that he presumed that it related to input costs that were
incurred until at least 6 September 2005. As we have said, according to the
appellants the agreements were not reached on 6 September 2005, nor did
they relate to any period after January 2005.

[19] Ms Shange, as we have said, testified at the trial. The respondents
also called four witnesses who were employed by the department in KwaZulu-
Natal. They were Mr Brendan Boyce, Mr M P Zuma, Ms Khethiwe Mlotshwe
and Ms Yolisa Ndia. Mr Boyce was deputy director of the post-settlement unit.
Ms Mlotshwe was also a deputy director and was the project manager of the
claims in question. Mr Zuma was a project officer that reported to Ms
Mlotshwe. Ms Ndia was the head of finance and administration. Ms Shange
was a poor and evasive witness. No criticism can, however, be levelled at the
other witnesses on behalf of the respondents.

[20] The high-water mark of the minutes of the meeting of 8 July 2004 in
respect of the case of the appellants is the recordal that Ms Hepburn ‘. . .
summarised the position as follows: If there is no leaseback or partnership,
RLCC will reimburse the farmers for inputs’. But this does not appear to be an
accurate summary of the minuted preceding discussion on the subject. Mr
Boyce was the spokesman of the department on the subject. According to the
minutes he, at best for the appellants, said that after submission of a detailed
plan in respect of making of inputs and the verification thereof, agreement
might be reached for payment of input costs. The minutes do not gainsay the
evidence of Mr Boyce that he told the meeting that the department would pay
for input costs only in terms of a written agreement in respect of a post-
settlement dispensation. The minutes must of course be viewed in the light of
what we have said before, especially that, according to Ms Hepburn’s own
evidence, no binding agreement was concluded at this meeting.

[21] It was recorded in the minutes of the meeting of 30 March 2005 that
the appellants handed documentation to the officials of the department at the
meeting. This documentation included the claims of the appellants in respect
of input costs for the period September 2004 to January 2005, with supporting
invoices. However, the minutes did not by any stretch of imagination record
that agreement had been reached at this meeting that these claims would be
paid.

[22] According to the minutes of the meeting of 6 September 2005, Ms
Shange said the following in respect of input costs:
‘Confirmed that these are reimbursable ─ payment will be done after transfer and on
proof of invoice. TS [Ms Shange] needs to know the amount of the inputs, the area
and they need the empty bags in respect of the fertilisers etc applied. TS needs
schedule with how many bags bought, how many used and these must be backed up
with invoices eg. If you bought 200 bags of fertiliser and 100lt of weed killer, how
much was used on the land and how much is remaining and the amount remaining
must be left on the farm. RLCC needs guarantees that people have these chemicals
on the land. These documents must be submitted and they will be paid after transfer.’
As we have said, these claims and invoices had already been provided to the
department on 30 March 2005. The documents had been audited by Crystal
Holdings (Pty) Ltd (Crystal Holdings) and the results were presented to Ms
Shange on 11 August 2005. In these circumstances these minutes are
compatible with the evidence of Ms Shange that she referred to submission of
documentation in respect of payment for fertilisers, weed-killers, etc that
remained on the farms on the dates of transfer.

[23] Counsel for the appellants relied heavily on the preamble to a
questionnaire that had been directed to the owners of the farms. He argued
that this document provided strong support for the case of the appellants. As
we see it, however, the contents of the document pointed the other way.
Although this was not provided for in the deeds of sale, the parties were ad
idem that the audits would take place to determine whether recognised
farming practices were followed on the farms and that only in case of a
positive audit result would the balance of the purchase price be released in
order for transfer of a farm to proceed. Crystal Holdings was appointed to
conduct the audits. Mr Pierre Redinger acted for Crystal Holdings in this
regard. The questionnaire was drafted by Mr Redinger. There was some
dispute as to the extent to which Mr Boyce contributed to the contents of the
preamble to the questionnaire, but in our view that is of no moment. The
questionnaire was finalised towards the end of April 2005. Both Mr Boyce and
Mr Redinger testified that the questionnaire reflected the understanding
gained by Mr Redinger from his interactions with the appellants and the

department. It is not disputed that Mr Boyce informed Mr Redinger at the time
that no agreement had been reached in respect of reimbursement of input
costs. The questionnaire reflected the purpose of the audits but also referred
to a second purpose in the following terms:
‘Secondly the audit shall be used as an objective tool to assess and quantify the
various inputs the reasonable and diligent landowner would have incurred on the
property and will assess whether or not he/she should be compensated for
reasonable input costs incurred by him/her in terms of a further agreement.’

[24] In context, this paragraph conveyed that the results of the audit would
be used to assess whether or not a landowner should be compensated for
reasonable input costs incurred by him or her and that, if so, the
compensation would be regulated by a further agreement; that is, an
agreement to be entered into after the assessment. The implication is that no
agreement for reimbursement of input costs had been reached by the end of
April 2005. We know that on no version of the appellants was such agreement
reached thereafter.

[25] Upon a consideration of the probabilities, it is unlikely that the
appellants would take the trouble to compile the claim documents handed
over on 30 March 2005, had they not thought that an undertaking had been
given to reimburse input costs. The appellants also pointed out that in the
Kranskop region sugar-cane was harvested every second year, with the result
that they would not reap the benefit of inputs made during the period of
September 2004 to January 2005. They said that this was the reason for the
agreements to reimburse these input costs. Despite these factors, however, in
our view the probabilities arising from the policies and procedures of the
department and the structure of the transactions in question, as well as the
evidence of the respondents, militate against a finding that it was agreed that
the costs of the inputs be reimbursed.

[26] The undisputed evidence of Ms Ndia was that under no circumstances
would payment in terms of an oral agreement be authorised by the
department. Ms Mlotshwe and Mr Zuma confirmed that input costs could only

possibly be reimbursed in terms of written agreements in respect of post-
transfer dispensations for the benefit of the communities. The undisputed
evidence was further that the department would make payments only
pertaining to these land claims in accordance with submissions in terms of
s 42D of the Act, approved by the Minister. In respect of each of the claims of
the communities, only the total agreed purchase price in terms of the
respective deeds of sale, a settlement planning grant and a restitution
discretion grant were approved. These two grants were calculated per
household of the communities and were to be utilized for the benefit of the
communities. This was accepted by the appellants, who said that Ms Shange
undertook to reimburse the pre-transfer input costs from funds that would be
obtained from other sources, especially the Department of Agriculture. But
according to the evidence, Ms Shange and the department had no control
over whether such funds would be made available. If such funds would be
made available, it would accrue to the communities. Thus, it is highly
improbable that Ms Shange would contractually bind the department in terms
of an oral agreement or for payment to the appellants from funds to be
obtained from another department or source. Finally, the absence of a
contemporaneous letter confirming the conclusion of the agreements and its
terms, must be placed in the scale against the appellants.

[27] To sum up, the viva voce evidence presented on behalf of the
appellants in respect of the conclusion of the alleged agreements relating to
input costs is vague and contradictory; the appellants could not state when
precisely any of the oral agreements had been reached or for which of them
Ms Boshoff and Mr Hohls was acting; the documentary evidence tendered in
support of the appellants’ claims is inconclusive and the probabilities favour
the respondents. Despite the poor quality of the evidence of Ms Shange, we
are not persuaded that the court a quo erred in finding that the appellants did
not succeed in proving the oral agreements sought to be relied upon.

[28] It remains to deal with the claim of the Boshoffs for reimbursement of
development costs. It can be disposed of briefly. The only evidence in this
regard was that the subject was discussed at a meeting on 19 August 2004,

attended by Ms Boshoff, Ms Hepburn and Ms Shange. Although the evidence
of Ms Shange, that no such meeting took place, is probably false, it is clear
from the minutes of this meeting that no binding agreement was concluded. A
note made of a conversation between Ms Boshoff and Ms Hepburn on 2
December 2004, stated that this issue still had to be addressed in discussion
with Ms Shange and that a commitment in writing by her was needed. This is
in accordance with the evidence of Ms Boshoff that she contemplated that the
development costs had to form part of the purchase price of the particular
farm. Therefore, even she accepted that the notion that costs of capital
development of a farm would be paid to a tenant in terms of an oral
agreement distinct from the deed of sale in respect of the farm, was
untenable.

[29] It follows that the appeal cannot succeed. There is no reason to
deprive the respondents of any costs of appeal.

[30] The appeal is dismissed with costs, including the costs of two counsel.

_______________________
L O Bosielo
Judge of Appeal

______________________
C H G van der Merwe
Acting Judge of Appeal

APPEARANCES:

For Appellants:

M G Roberts SC (with him C G Van der Walt)
Instructed by:
Marshall Attorneys, Johannesburg
McIntyre & Van der Post, Bloemfontein

For Respondents:
A A Gabriel SC (with her J Thobela-Mkhulisi)
Instructed by:
State Attorney, Durban
State Attorney, Bloemfontein