Seboni N.O and Another v ABSA Bank Limited and Others (Leave to Appeal) (18797/2021) [2025] ZAGPPHC 6 (17 January 2025) (2025)

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INTHE HIGH COURT OF SOUTH AFRICA

GAUTENGDIVISION, PRETORIA

CASE NO: 18797/2021

(1)REPORTABLE: YES / NO

(2)OF INTEREST TO OTHER JUDGES: YES/NO

(3)REVISED: YES/NO

DATE 17 January 2025

SIGNATURE

In the matter between: -

MATSHWENE MARIAMAGDALINE SEBONI N.O. First Applicant

LETHABO EDMUND SEBONISecondApplicant

And

ABSA BANK LIMITEDFirstRespondent

SOUTHERN SPIRITPROPERTIES 87 (PTY) LTD

(in liquidation)SecondRespondent

ASSET MANAGEMENTSPECIALIST (PTY) LTD

(deregistered)ThirdRespondent

REGISTRAR OF DEEDS,SOUTH AFRICA FourthRespondent

NATIONAL CREDITREGULATOR FifthRespondent

TSHEPO HARRY NONYANEN.O. SixthRespondent

ANDREW MAKGOANAKOTLOLOSeventh Respondent

FIRST RAND BANKLIMITED EighthRespondent

PROC CORP187CCNinthRespondent

SB GURANTEE SO (RF)(PTY) (LTD) TenthRespondent

JUDGMENT

GWALAAJ

[1]This is a judgment in the application for leave to appeal brought bythe seventh respondent. Inthis judgment the parties shall bereferred to as they appear in the heading and in the main judgment.

[2]The seventh respondent applies for leave to appeal against the wholejudgment and order of thiscourt delivered on 29 August 2024. Theapplication is founded on the provisions of section 17(1)(i) and (ii)of the Superior CourtAct, 10 of 2013[1].In essence, the seventh respondent contends that the appeal wouldhave prospects of success and that there are some compellingreasonsthe appeal should be heard including conflicting judgment(s) on thematter under consideration.

[3]It is now trite that an applicant in an application for leave toappeal faces a higher and stringentthreshold to demonstrate thatthere is a measure of certainty that another court will differ fromthe court whose judgment is soughtto be appealed against.[2]

[4]I have considered the argument on behalf of both parties includingsuch argument that I do notspecifically highlight in this judgment.I am unable to form an opinion that another court will differ fromthe judgment soughtto be appealed. In what follows I deal, in part,with some of the arguments advanced on behalf of the seventhrespondent in supportof his application for leave to appeal.

[5]In his first argument the seventh respondent contends that theapplicants consented to the transferof the property to SouthernSpirit Properties 87 Pty Ltd (SSP) – the second respondent. Itis argued that the applicants,acting on behalf of the Trust, gave amandate and a power of attorney and appointed Asset ManagementSpecialist Pty Ltd (AMS) –the third respondent – astheir agent the power of substitution and to represent the Trust toform and register a privatecompany, to draft an agreement of sale,to administer the proceeds of the sale, to draw up all necessarydocumentation, take allsteps necessary and sign all documentation togive effect to the mandate and power of attorney. Accordingly, so itwas argued,there was a consent to transfer the property.

[6]This argument loses sight of the fact that the whole transaction,from the beginning to the end,was underlaid by fraud and that theapplicants did not have any intention to sell or to transfer theirproperty. Even worse forthe seventh respondent, allegations that theapplicants were hoodwinked into selling their property were notdenied in the answeringaffidavit. Since such allegations standunchallenged, they must be accepted as fact.

[7]The second argument by the seventh respondent was that he was a bonafide purchaser who innocently brought the property for value withno notice of any defect in the seller’s (the SSP’s)title.There are at least two problems with this argument. The firstis that SSP never had any title to the property to begin with.Ownershipof the property was never transferred from the applicants.The issue of defect in title does not even arise. The second is thatduring 2018, before the property was purportedly transferred to theseventh respondent, the second applicant attempted to preventthesale by instituting legal proceedings which the seventh respondentactively opposed. Therefore, it cannot be that the seventhrespondentwas unaware of the fact that the SSP’s title was in dispute.

[8]The third contention the seventh respondent raised was that if theproperty was sold at the judicialsale or by the liquidators of acompany in liquidation and the transfer takes place before the ownerof the property institutesrescission application, the propertycannot be recovered from the bona fide purchaser. The right toproperty is constitutionally guaranteed. As such the owner of aproperty is protected against arbitraldeprivation. A time has nowcome where if the owner of the property was deprived of their rightto property, the cause or basisfor the deprivation may be judiciallyconsidered and in appropriate circumstances the right be restored. Ifthe court were to failto intervene in a matter such as this wherethere is evidence that the right to property was lost throughfraudulent means, thatwould be to sanction fraud and perpetuateinjustice. The other problem I have with the seventh respondent’sargument in thisregard is that since SSP never acquired any right tothe property, it could not transfer any ownership. The inverse isthat theseventh respondent could not acquire any right to theproperty from SSP who did not have a title.

[9]The fourth argument was based on the abstract theory of transfer ofreal right. The argument wasthat, if the agreement to transfer areal right was valid, generally, a real right will pass despite thatthe cause – theunderlying agreement – was defective. Inthis matter the underlying agreement was not just defective. It wasunderlaid andor tainted by fraud. Fraud vitiated such agreement. SeeNedbank v Mendelow 2013 (6) SA 130 (SCA); Quartermark Investments(Pty) Ltd v Mkhwanazi and Another 2014 (3) SA 96 (SCA). Thisbecomes a distinguishing feature between the present matter and theLegator McKenna Inc and Another vs Shea and Others 2010 (1) SA 35 SCA(the Shea matter) upon which the seventh respondent placed reliance.In the Shea matter, there was no fraud involved. In thatmatter MsShea was declared incapable of managing her own affairs and was placeunder curatorship by the order of the court. MrMcKenna was appointedas a curator bonis. Mr McKenna, in his capacity as a curatorsold the property belonging to Ms Shea. She was later declaredcapable of managing heraffairs. Upon this experience she institutedproceedings for the return of the property. She contended that thecontract that gaverise to the transfer of the property was invalidbecause it was concluded by Mr Mckenna before the Master of the HighCourt hadissued him with letters of curatorship in terms of Section72(1)(d) of the Administration of Estates Act, 66 of 1965.

[10]The SCA stated thus:

[22] Inaccordance with the abstract theory the requirements for the passingof ownership are twofold, namelydelivery - which in the case ofimmovable property is effected by registration of transfer in thedeeds office - coupled with aso-called real agreement or '…'.The essential elements of the real agreement are an intention on thepart of the transferorto transfer ownership and the intention of thetransferee to become the owner of the property (see eg Air-Kel (Edms)Bpk h/a MerkelMotors v Bodenstein en 'n Ander 1980 (3) SA 917 (A) at922E - F; Dreyer and Another NNO v AXZS Industries (Pty) Ltd supra atpara 17). Broadly stated, the principles applicableto agreements ingeneral also apply to real agreements. Although the abstract theorydoes not require a valid underlying contract,eg sale, ownership willnot pass - despite registration of transfer - if there is a defect inthe real agreement (see eg Prellerand Others v Jordaan 1956 (1) SA483 (A) at 496; Klerck NO v Van Zyl and Maritz NNO supra at 274A - B;Silberberg J and Schoeman op cit at 79 - 80).

[11]In the present matter there was no intention on the part of theapplicants to transfer ownership of the propertyto SSP. The transferof the property was part of the scheme by AMS. In light of thescheme, even SSP did not have intention tobecome the owner of theproperty. It took transfer just to give effect to AMS’s schemeto deceive the unsuspecting. In anutshell, the agreement that gaverise to the transfer of the property was part of the fraud on thepart of AMS. The consequenceof the fraud is that the agreement wasvoid.

[12]The fifth argument on behalf of the seventh respondent was that leaveto appeal should be granted consideringthat the judgment conflictswith other judgments. I was not referred to any judgment todemonstrate this point. In the main judgmentreference was made toseveral other judgments that dealt with the subject matter hereinwhich had similar facts and had similaroutcomes. I could not findsuch judgments with which the judgment sought to be appealedconflicts.

[13]The other contention that the seventh respondent raised is that thecourt erred in that it set aside irrelevantdocuments and agreementswhich relate to third parties with no relevance to the applicants. Asa result, so it was argued, theorder is vague and embarrassing.First, I do not see it the way seventh respondent sees it. However,for the possibility that someoneelse may view the judgment and orderas vague, I give the following explanation.

[14]In prayer one (1) of the notice of motion the applicants sought anorder as follows:

1.[t]he below mentioned documentation and agreements orsimilar referred to in the Founding Affidavit, andconcluded between the First Applicant and Second and ThirdRespondents be declared invalid and of no force and effect and besetaside.

Theylisted a number of documents as annexures, from Annexure A further.

[15]Indeed, documents listed in the notice of motion include documentsand or agreements which were apparentlyentered into between SSP orAMS and third parties. In the founding affidavit though theapplicants explained as follows:

74.[d]uring 2018, when I realised that we lost the property because ofthe AMS scheme and as stated in paragraph54 above, my investigationled me to realise that the documents I signed included thosementioned below. I attach those that Isigned and could secure andsimilar documentation, with reference to the judgmentsreferred to above, I managed to obtain and which I signed for theproperty to be transferred tothe second respondent…”

[16]To my understanding, the applicants are saying that where they couldnot find or secure the actual documentsthat the deponent to thefounding affidavit signed as part of the scheme by AMS, they wereattaching examples of such documentsas similar documents that AMSwould require their would-be victims to sign to complete the scheme.I understand the applicantsto be saying that they signed similardocuments as those referred to the notice of motion. The fact thatthe applicants could notsecure some of the documents they actuallysigned is understandable given the time that has since lapsed sincethey were hoodwinkedinto signing those documents.

[17]The order I made did not necessarily set aside the documents relatingto third parties. This much is clearfrom the fact that the orderdoes not refer to documents as annexures as it is the case in thenotice of motion. The order simplyset aside such documents as wouldordinarily be signed to give effect to the transfer of a property inthe perpetuation of thescheme by AMS.

[18]In any event, even in the absence of that order setting aside thedocuments, the appeal does not enjoy anyprospect of successparticularly in view of paragraphs 2, 3 and 4 of the order.

[19]For all these reasons, I was not persuaded, nor could I form anopinion that the appeal has prospects ofsuccess on any of thegrounds raised and contended for.

[20]The next aspect to deal with is the question of costs. In the mainjudgment I did not award costs, thoughit was so deserving, becausecounsel for the applicant indicated that they were acting probono. The situation has since changed. The applicants’legal representatives are no longer acting pro bono. Theyinformed the hearing accordingly. And they seek costs. I am of theview that costs are justified and cannot be left undecided.Theapplicants have succeeded in defending the application for leave toappeal and as such, in my view, they are entitled to costs.They isno reason to order otherwise. The costs shall include the costs oftwo counsel, both on Scale B.

[21]In the result I make an order in the following terms:

1.The application for leave to appeal is dismissedwith costs includingcosts of two counsel on Scale B.

GWALAAJ

ACTINGJUDGE OF THE HIGH COURT

GAUTENGDIVISION, PRETORIA

Appearances:

Counsel for theseventh respondent:

Adv DB du Preez SCand Adv van Dyk

Attorneys for therespondent

Ross & JacobszInc

Counsel for theapplicant:

Adv N Ferreira withhim Adv B Mtukushe

Attorneys for theapplicant:

Eddie Du ToitAttorneys

Date of hearing:

21 October 2024

Date of delivery:

17 January 2025

[1]Whichprovides as follows: “17Leave to appeal

(1)Leave to appeal may only be given where the judge or judgesconcerned are of theopinion that

(a)(i)the appeal would have a reasonable prospect of success; or

(ii)there is some other compelling reason why the appeal should beheard, including conflicting judgmentson the matter underconsideration;

[2]TheMont Chevaux Trust (IT 2012/28) v Tina Goosen(Unreported, LCC case no LCC14R/2014 dated 3 November 2014); SeeAlso judgment by the full court in The Acting National DirectorofPublic Prosecution v Democratic Alliance (unreported, GP case no19577/09 dated 24 June 2016) at para 25; See Also SIZAZONKEELECTRICAL CC AND OTHERS vs ESKOM HOLDINGS LIMITED (unreported, GPCase No. 75781/2013 on application for leave to appeal); SeeAlsoNotshokovuv S (157/15) [2016] ZASCA 112 (7 September 2016)

Seboni N.O and Another v ABSA Bank Limited and Others (Leave to Appeal) (18797/2021) [2025] ZAGPPHC 6 (17 January 2025) (2025)
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