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NOT REPORTABLE

IN THE HIGH COURT OF SOUTH AFRICA

(EASTERN CAPE DIVISION, GRAHAMSTOWN)

Case no: 3624/2014

Date heard: 9-11 May,

5 August 2016

Date delivered: 16 August 2016

In the matter between

TIADOR 15 CC t/a REMAX

INDEPENDENT PROPERTIES                                                                                     Plaintiff

Vs

JOHAN CHRISTIAAN TROSKIE (JUNIOR) N.O.                                            First Defendant

ALETTA ELIZABETH TROSKIE N.O.                                                         Second Defendant

HENDRIK WYNAND TROSKIE N.O.                                                              Third Defendant

ANDRE VAN DER LINGEN N.O.                                                                  Fourth Defendant

JOHAN CHRISTIAAN TROSKIE N.O.                                                             Fifth Defendant

ALETTA ELIZABETH TROSKIE N.O.                                                             Sixth Defendant

ANTHONY ABRAHAMSON N.O.                                                               Seventh Defendant

And

THE NATIONAL MINISTER OF RURAL                                                                  Third Party

DEVELOPMENT AND LAND REFORM

JUDGMENT

PICKERING J:

[1] This is an action by an estate agent for payment of certain monies allegedly owing to it in respect of agent’s commission.

[2] Plaintiff is Tiador 15 CC t/a Remax Independent Properties, a close corporation with its registered address in Port Elizabeth. 

[3] The first defendant is Mr. Johan Christiaan Troskie (Jnr) N.O., an adult male farmer who is cited in his capacity as Executor in the deceased estate of the late Johan Christiaan Troskie (Snr) (“the deceased”) who died on 3 March 2011.

[4] The various other defendants are cited in their capacities as Executors/Executrix of the deceased estate or in their capacities as Trustees of the Johan Troskie Family Trust (“the Trust”), a duly registered trust with IT number 316/2000/1.

[5] For present purposes it is only of relevance to state that Mr. Andre van der Lingen, an attorney practicing as a partner of Abrahamson and Reynolds Attorneys in Somerset East, is cited as fourth defendant in his capacity as an Executor in the deceased estate as well as being cited as ninth defendant in his capacity as a trustee of the said Trust.

[6] Plaintiff alleges in its particulars of claim that on or about 15 July 2010, and at Cookhouse, the deceased gave to plaintiff, who was duly represented by its managing member, Ms. Kobie Potgieter, an oral mandate to market and sell the following immovable properties:

“Remainder of Farm 453

In Extent 1478,0273 Hectares

Somerset East Road

(hereinafter referred to as “Farm 453”) which was registered in the name of the deceased in terms of Title Deed T36111/2010;

Farm 86

In Extent 27,6688 Hectares

Somerset East Road

(hereinafter referred to as “Farm 86”) which was registered in the name of the deceased in terms of the Title Deeds T2217/1080 and T27436/1974;

Portion 3 of Farm 84

In Extent 409,8358 Hectares

Somerset East Road

(hereinafter referred to as “Portion 3”) which was registered in the name of the Trust in terms of Title Deed T35200/2002;

Portion 7 of Farm 84

In Extent 526,0373 Hectares

Somerset East Road

(hereinafter referred to as “Portion 7”) which was registered in the name of the Trust also in terms of the Title Deed T35200/2002.”

[7] These properties are collectively known as Craig Gowan.

[8] In terms of the aforesaid mandate plaintiff was to sell the properties to the Department of Rural Development and Land Reform of South Africa, representing the National Government of the Republic of South Africa (“the Government”) for a purchase consideration of R25 million.  Plaintiff alleges that in affording the mandate to it deceased acted both in his personal capacity as well as in his capacity as trustee and duly authorised representative of the Trust.

[9] Plaintiff alleges, inter alia, that it was a term of the mandate that it would have earned its commission upon the conclusion of a valid and binding agreement of sale in respect of the properties between the deceased and the Trust as sellers and the government as purchaser in that it would, in that event, have been the effective cause of any such sale of the properties to the government.  It further alleged that its commission would be calculated at 5% of the ultimate purchase price plus VAT.  

[10] Plaintiff alleges further that an agreement of sale was in due course entered into between the deceased and the Trust as sellers and the government as purchaser for a total purchase consideration unknown to it.  It alleges that the agreement of sale was concluded as a direct consequence of the government’s introduction to the properties by Ms. Potgieter as well as by her subsequent negotiations with the Government.  In this regard plaintiff alleges that in the course of the performance of its mandate Potgieter duly introduced the relevant officials of the Government to the properties and entered into extensive negotiations with the Government to procure the sale of the properties.  Plaintiff avers that the deceased passed away on 3 March 2011 before transfer of the properties could be effected but after plaintiff had performed all its obligations in terms of its mandate.  In consequence, so it is alleged, the liability of the deceased to pay commission in respect of farms 453 and 86 evolved onto the deceased’s estate.

[11] Plaintiff alleges that it subsequently established that two new agreements of sale were concluded between the Government and the Trust on 1 August 2011 in terms of which the Trustees sold farms 453 and 86 to the Government for a purchase price of R8 million and portions 3 and 7 for a purchase price of R9,5 million.  It was recorded that at the time of the sale farms 453 and 86 were still registered in the name of the deceased but that the Trust was the beneficiary in respect thereof.  Plaintiff accordingly claims payment of the sum of R475 000,00 against first, second, third and fourth defendants in their capacities as Executors of the deceased’s estate and against fifth, sixth and seventh defendants in their capacities as Trustees of the Trust.  Plaintiff further claims against the fifth, sixth and seventh defendants in their capacities as Trustees of the Trust payment of the sum of R400 000,00 plus VAT as and for agent’s commission.

[12] In their plea the defendants allege that they have no knowledge of whether the deceased gave plaintiff an oral mandate in respect of the properties or whether plaintiff introduced the relevant officials of the Government to the immovable properties.  They plead, inter alia, that during or about 1 August 2011 the deceased estate and the Trust as sellers concluded valid and binding agreements of sale with the National Government of the Republic of South Africa in terms of which the Government purchased the properties from the estate and the Trust for a total purchase consideration of R17,5 million.

[13] Defendants plead further that the agreements of sale in terms of which farm 453 and farm 86 were sold provided, inter alia, as follows:

“23.     The parties agree that the sale is linked to the sale and transfer of the properties described as

23.1    Portion 3 of the farm 84 Krugers Post in the Blue Crane Route Municipality ...

23.2    Portion 7 of the farm 84 Krugers Post in the Blue Crane Route Municipality ...

24.       The purchaser warrants that it has not been introduced to the properties purchased herein and stipulated under paragraph 23 by any estate agent and that according to the purchaser no agent’s commission is payable.  The purchaser indemnifies and shall hold harmless the seller against any claims of commission by any estate agent and any legal cost associated in defending such a claim.”

[14] The defendants accordingly joined the National Minister of Rural Development and Land Reform to the action as a Third Party and pleaded that in the event of judgment being given against them in favour of the plaintiff they were entitled to an order against the Third Party indemnifying them in such amount as they might be ordered to pay to the plaintiff. 

[15] In its plea the third party raised a number of grounds upon which it disputed liability.  It denied that any estate agent was the effective cause of the sale of the properties to the government and denied further that any of its officials were aware of the involvement of any estate agent in the sale of the properties. 

[16] It pleaded further that in the event of the court finding that an estate agent was entitled to commission in respect of the sale of the properties it denied liability on the basis of a common mistake as to the involvement of an estate agent in the sale of the properties, alternatively unilateral error in that the sellers or their representatives fraudulently or negligently misrepresented to the government that no estate agent had introduced the properties and that no estate agent was entitled to estate agent’s commission.

[17] Ms. Kobie Potgieter (“Potgieter”) the owner and managing member of plaintiff testified that she had a fortuitous meeting with a certain Ms. Sibanyoni by virtue of selling to her a townhouse.  In the course of their conversation Sibanyoni informed plaintiff that she was employed by the Department of Land Affairs and that in the course of such employment she sourced good farms for the department to purchase.  She informed Potgieter that her contact person was a certain farmer in Somerset East district, one Schoonbie. 

[18] Potgieter told Sibanyoni that she had a number of farms for sale on her books and, according to Potgieter, in total she presented 21 farms to the Department of Land Affairs. 

[19] She testified that, with regard to Craig Gowan, Schoonbie had arranged a meeting between Johan Troskie (Snr) and his son, Natie.  They duly met at the Cookhouse Roadhouse on 13 July 2010.  In the course of this meeting Potgieter explained to the Troskies that she would present the farm to Land Affairs and needed all relevant information pertaining thereto.  She had with her the Department of Land Affairs’ standard form headed “Intent to sell a farm” which the department required to be completed.  She had obtained a batch of these forms from Sibanyoni.  She went through the form with the deceased filling in the relevant details of the farm Craig Gowan, including all the necessary information relating inter alia to the extent of the properties; the area of land under irrigation; the water rights; the crops; and the buildings erected thereon.  According to Potgieter she explained to the deceased and his son that she was going to present the farm to Land Affairs for a price of R25 million. 

[20] Potgieter stated that the deceased was very happy with the arrangement.  In particular he agreed that commission of 5,7% would be payable to plaintiff and he accordingly signed the document. Plaintiff stated that this mandate was unlimited in respect of time because, as she explained to deceased, the processes of Land Affairs were very lengthy.

[21] Once Potgieter had the signed Intent to Sell she prepared a power point presentation containing all relevant details of Craig Gowan.  Having done so she placed the documents in a folder and took it personally to the offices of Land affairs where a file was then opened by the Registrar in charge of administration.  A number, PE6/3/9/S7/40, was allocated to the file.  According to Potgieter every time she took a file to land affairs in respect of a particular farm that file would be allocated its own specific number. 

[22] It was common cause that a certain Mr. Snyman of the Department of Agriculture was tasked with accessing each farm in which Land Affairs was interested in order to verify the particulars thereof.  Following on this, information gathered by Snyman would be placed before the District Screening Committee.  Should the District Screening Committee approve the purchase of the farm it would in turn approve the commencement of a tender process in order for a valuer to be appointed. 

[23] In due course Mr. Albert van Rensburg was appointed as valuer for Craig Gowan.  During January 2010 he telephoned Potgieter and asked her what information she had concerning the farm.  She sent him a duplicate of the bundle which she had handed in to Land Affairs. 

[24] It is common cause that two similar Deeds of Sale in respect of farm 463 and 86 and portion 3 and 7 respectively were drafted by an attorney, Mr. Riaan van Rensburg and were signed by deceased on 30 January 2011.  These documents constituted offers by deceased to sell Craig Gowan to Land Affairs. 

[25] The following clauses appear in both documents, namely:

“Agents commission of 5% excluding VAT shall be paid by the seller against registration of transfer of the property into the name of the purchaser to Remax Independent Properties, Kobie Potgieter ...”

[26] And:

“If the Deed of Sale is cancelled as a result of breach of contract committed by the purchaser the estate agent shall be entitled to recover such commission from the purchaser.”

[27] Potgieter had no further involvement in the matter until, sometime in March 2011, after deceased’s death, she spoke telephonically to Mr. Troskie Jnr.  He told her that he had never given her a mandate and that he was not prepared to communicate any further with her.

[28] In the light of this conversation Potgieter instructed attorney van Rensburg to address a letter on plaintiff’s behalf to Troskie Jnr advising him that plaintiff was entitled to commission in the event of Land Affairs purchasing Craig Gowan.  In reply hereto Mr. van der Lingen, the fourth defendant, stated that he was now acting for the Trust and that the Trust denied that plaintiff had been afforded a mandate in respect of Craig Gowan.  Van der Lingen further stated that no Deed of Sale had been entered into by the Trust in respect of Craig Gowan.

[29] Potgieter confirmed that there was an eventual sale of the properties by the Trust to the Department on 1 August 2011 and reiterated that she was the effective cause thereof. 

[30] Plaintiff referred further to a memorandum prepared by Land Affairs dated 26 November 2010 and headed “Application for the release of planning grounds towards appointment of a service provider to do an evaluation.”  The file number on the memorandum was the same file number which had been allocated to the bundle of documents which she had handed into Land Affairs.  Of relevance in this memorandum is the following:

“2.1     The Troskie family with the help of Remax Properties approached the Department of Rural Development and Land Reform on July 15^th 2010 with the intention to sell the remainder of the portion 317 of the farm Kruger Post, number 84 ... see the attached Intent to Sell.”

[31] According to Potgieter the description of the property was compiled from the information that Mr. Snyman had gathered with her input.  The memorandum was signed by the aforementioned Ms. Sibanyoni as well as by a certain Mr. Ngangani, the Acting Chairman of the District Screening Committee.

[32] Included in the bundle was the valuer’s invoice, containing the original file number.  It is common cause that after the evaluation performed by Mr. van Rensburg the Department advised Troskie that they were willing to offer the amount of R20,85 million.  Once again the file number which appears on this communication is that originally allocated.

[33] It is further common cause that at some stage Mr. van der Hoogen (“van der Hoogen”) of Land Affairs became involved in the matter.  In consequence of his intervention the valuation of the property was reduced to R17,5 million. 

[34] On 10 May 2011 Mr. Andre van der Lingen addressed the following email (D1) to Troskie Jnr and copied that email to van der Hoogen. 

“Johan, Andre van der Hoogen het my terug geskakel.  Hy sê ons moet glad nie reageer op Potgieter se versoek om iets te teken nie.  Hy sal opdrag aan my deurstuur en is bereid om ‘n vrywaring in die kontrak te teken tot die effek dat hy nie deur enige agente aan die eiendom voorgestel is nie.  Ek hou jou op hoogte, Andre van der Lingen.”

[35] Potgieter agreed, under cross examination, that there were a number of estate agents involved in selling farms to the department.  She stated that in respect of Craig Gowan she had only become aware after plaintiff had instituted action that there were two other estate agents involved at some stage namely, Warren Properties and Kassie Lotter.  She accepted that they had also been mandated to sell the farm to the government.  She disputed that because of this the defendants were not sure as to which of the estate agents, if any, were the effective cause of the sale.  She stated that she was the only estate agent involved from the beginning and who had obtained the first Intent to Sell.  She reiterated that it was the information that she had given which had been used throughout the whole process.  The valuer had telephoned her and no one else concerning certain information which he required.  Her file number was used throughout the process.

[36] Mr. Johan Troskie, Junior, (“Troskie”) the first and fifth defendant in his respective capacities, and the son of Johan Troskie (Snr) testified that he was farming on Craig Gowan until 2000.  During 2000 approaches were made to the Government for the sale to it of Craig Gowan but these came to naught.  Thereafter, during 2009, another estate agent’s efforts to sell the farm to the Government were also fruitless. 

[37] After his father’s death in March 2011 Troskie heard, for the first time, that his father had signed an agreement to sell the farm to the third party.  At that stage Troskie did not want to sell.  He arranged with his attorney and fellow trustee, Mr. Andre van der Lingen, to obtain a copy of the contract from which he noticed that the “intent to offer” had been signed by his father on 30 January 2011. 

[38] He then received a telephone call from Potgieter who wanted plaintiff’s commission.  He advised her that the agreement had lapsed because his father had not signed the contract within the period of 60 days stipulated therein.  He also advised her that he had never given plaintiff a mandate. 

[39] On 11 April 2011 he was telephoned by van der Hoogen.  Van der Hoogen told him that the government wanted to buy the farm but for a price of only R16 million.  This price was unacceptable to Troskie but he agreed to meet van der Hoogen.  At that stage he saw the possibility of a sale to the State as a way to meet the estate duty obligations.  He did so meet van der Hoogen at a later stage at the Cookhouse garage.  They drove together to the farm.  Van der Hoogen told him that he did not work with estate agents and assured him that no agent was involved and that he had approached deceased directly.  He added that he had been aware of the farm for years. 

[40] Van der Hoogen then left to inspect another farm.  Whilst he was away, Mr. Kassie Lotter, another estate agent, phoned saying that he was together with van der Hoogen and Mazwai to whom the farm would be sold.  Lotter demanded that he be paid R2 million in commission. 

[41] Thereafter Troskie again met van der Hoogen.  After certain negotiations van der Hoogen’s final offer was R17,5 million.  Troskie told him that he would have to consult with his co-trustees.  At some stage thereafter Troskie met van der Hoogen at van der Lingen’s offices in Somerset East.  In the course of this discussion Troskie informed van der Hoogen of the demands for commission by both plaintiff and Lotter.  Van der Hoogen again said that defendant did not work with estate agents and that no agent was involved.  In response Troskie told van der Hoogen that he was not prepared to pay commission if he was only receiving R17,5 million and that he required an indemnity should any claim for commission be made.  His evidence in this regard bears repeating, namely:

“Ek het hom vertel van Kobie Potgieter en ek het hom vertel van Kassie Lotter en dat almal wil kommissie hê en ek is nie bereid om die kommissie te betaal as ek net R17,5 miljoen kry nie dus vra ek vrywaring dat indien iemand kommissie eis moet die Staat dit betaal.”

Van der Hoogen agreed that a clause indemnifying the Trust against any claim for commission could be included in the contract. 

[42] Troskie explained that if the Trust had had to pay commission it would never have agreed to the price of R17,5 million.  He stated that he had no idea as to who the effective cause of the sale was.  It was because of the phone calls from Potgieter and Lotter that he had demanded the indemnity.   

[43] He denied having misled van der Hoogen or having made any misrepresentation to him or anyone else concerning any estate agent. 

[44] Thereafter the farm was sold for R17,5 million.

[45] The fourth defendant, Mr. van der Lingen (“van der Lingen”), testified that from the time that he began practicing as an attorney at Abrahamson and Reynolds in Somerset East he had dealings with the Troskie family and Trust.  After the death of the deceased he became a Trustee of the Trust himself.  He only became aware of the Deed of Sale signed by the deceased at the time that deceased’s will was being discussed after the deceased’s death.  In terms of the will van der Lingen was appointed as an Executor of deceased’s estate.  At that meeting deceased’s son, Natie, informed van der Lingen that the attorney, van Rensburg, was involved.  He contacted van Rensburg who sent him the offer to purchase signed by the deceased which, however, the government had not signed.

[46] Some time thereafter, during May, van der Lingen met van der Hoogen who was brought to his offices by Troskie.  Van der Hoogen introduced himself as the Head of Land Acquisition and Warehousing for the national government.  Van der Lingen was informed by van der Hoogen that agreement had been reached with Troskie to sell Craig Gowan for a total price of R17,5m. 

[47] Van der Lingen was aware that estate agents had been involved in the unsuccessful marketing of Craig Gowan for a number of years.  Deceased was never prepared to sell for the price which was offered by the government at that time.  At the time of meeting van der Hoogen, van der Lingen was aware that both Kassie Lotter and plaintiff were claiming commission in respect of the sale of Craig Gowan. 

[48] Van der Lingen therefore pertinently raised the issue of commission with van der Hoogen who told him that no estate agent was involved and that he had been aware of the farm before any estate agent had become involved in the matter.  Defendants, however, insisted on an indemnity being granted in respect of any claim for commission because they were uncertain as to whether commission was due to any estate agent.    

[49] It was then agreed with van der Hoogen that when the Deeds of Sale were drawn up indemnity clauses could be inserted therein.  According to van der Lingen, van der Hoogen was satisfied with this.  In the meantime Troskie advised van der Lingen telephonically that he had been contacted by Potgieter who was claiming commission.   Because of this van der Lingen telephoned van der Hoogen and advised him of this development.  Van der Hoogen told him not to react to plaintiff’s claims or to sign anything and he would in due course send through to van der Lingen the requisite instruction to draft the Deeds of Sale and to include therein the indemnity in respect of commission.

[50] Van der Lingen accordingly sent the email (D1) to Troskie which he copied to van der Hoogen.  This email, dated 10 May 2011, bears repeating:

“Craig Gowan

Johan, Andre van der Hoogen het my terug geskakel.  Hy sê ons moet glad nie reageer op Potgieter se versoeke om iets te teken nie.  Hy sal opdragte aan my deurstuur en is bereid om ‘n vrywaring in die kontrak te teken tot die effek dat hy nie deur enige agente aan die eiendom voorgestel is nie.”

[51] When the instruction from van der Hoogen did not arrive timeously van der Lingen addressed another email to van der Hoogen on 28 May 2011 in which he informed van der Hoogen that the Trust was being prejudiced by the delay in finalising matters and that it was the intention to explore the leasing of the farms so as to generate an income.

[52] On 1 June van der Lingen received an email from one Peliwe Mjemla, a State employee, which was also copied to van der Hoogen.  This email reads as follows:

“Purchase and sale of the farms known as Craig Gowan and Krugers Post.

The department has agreed to purchase the property at R17,5 million.  Kindly advise which conveyancers we are going to be using so that the department can communicate directly with the conveyancer.”

[53] On 8 June van der Lingen sent an email to Mjemla, copied to van der Hoogen, in the following terms:

“A certain part of the farm is still registered in the name of the deceased.  I am the Executor in the estate and am doing my best to finalise the winding up thereof.  My suggestion would be that the transfers be split for reason of expediting the beneficial occupation by the purchaser.  The portions registered in the name of the Trust to be transferred as soon as possible and the portions still registered in the estate, as soon as the estate has being finalised. 

Mr. van der Hoogen has indicated that the seller will be in a position to issue guarantees.  Kindly confirm I may draft same into the Deed of Sale.  Can you please inform who holds authority to sign the Deed of Sale on behalf of the government and to whom I might address issues concerning the drafting of the Deed of Sale.”

[54] Ms. Mjemla replied by email on 9 June, copied to van der Hoogen, stating that there was no problem with the splitting of the properties as suggested and adding that it was important to agree on the price to be paid for each portion.  The letter added that Ms. Masholologu, who was the Chief Director in the Eastern Cape, had authority to sign as the purchaser and that as soon as the Deeds of Sale had been finalised by van der Lingen he should send them to “our legal office Ms. Mbekeni.”  (sic)

[55] On 9 June van der Lingen addressed an email to Ms. Mjemla, copied to van der Hoogen, as follows:

“Kindly find attached the proposed agreement pertaining to the Trust property.  I am drafting a similar agreement pertaining to the property in the estate and will forward forthwith.  Please indicate whether the terms of the offer are acceptable and if we need to effect any changes.”

[56] Of importance in the attached Deed of Sale is clause 23 thereof which reads as follows:

“SPECIAL CONDITIONS

The parties agree that this sale is linked to the sale and transfer of the properties to be transferred to the seller from the estate of the late Johan Christiaan Troskie in respect of which a separate Deed of Sale shall be entered into better described as:

1.    The remainder of farm 453 ...

2.    Farm 86, situated as above ...

The transfer of the properties purchased hereunder shall be effected as soon as possible while the transfer of the properties from the estate shall be transferred as soon as the estate had been finalised.”

[57] On the same day van der Lingen addressed a further email, also copied to van der Hoogen, to Ms. Mjemla stating as follows:

“Please find attached two proposed Deeds of Sale in respect of the properties in the deceased’s estate.  Writer hereof will be signing the Deed of Sale on behalf of the Trust and as Executor in the deceased’s estate.  Kindly consider the terms and feel free to suggest any amendments.”

[58] In the Deed of Sale attached thereto clause 23 relating to special conditions reads as follows:

“The parties agree that this sale is linked to the sale and transfer of the properties to be transferred to the seller from the estate of the late Johan Christiaan Troskie in respect of which a separate Deed of Sale shall be entered into better described as:

1.    Portion 3 of the farm 84 Krugers Post ...

2.     Portion 7 of the farm 84 Krugers Post ...” 

[59] Clause 24 of the agreement reads as follows:

“AGENTS COMMISSION

The purchaser warrants that it has not been introduced to the properties purchased herewith and stipulated under paragraph 23 by any estate agent and that according to the purchaser no agent’s commission is payable.  The purchaser indemnifies and shall hold harmless the seller against any claims of commission by any estate agent and any legal costs associated in defending such a claim.”

[60] That same evening Ms. Mjemla addressed the following email, copied to van der Hoogen, to van der Lingen, namely:

“Kindly be advised that the office is looking at the price for the portion for transfer and we shall revert back to you soon.  Kindly note the comments below on the guarantee and make the amendments.”

[61] The “comments below” referred to are contained in an email from Ms. Mbekeni, the legal officer, in which it is stated that the guarantees that the purchaser has are State guarantees and that such could be included in the Deed of Sale instead of cash payments or bank guarantees.

[62] On 10 June van der Lingen replied to Mjemla as follows:

“I acknowledge your request and will do so.  Will this be the only concern?  I would rather populate all your concerns and address it at one go.  Otherwise we might have too many drafts of the documents floating around.”

[63] On the same day van der Hoogen addressed an email to Mjemla, copied to Mbekeni, stating as follows:

“Dear all.

The price is not a problem for the portion as it is subject to the sale of the other portions.  I would like to see that the contract provide for the towers and wind lands income also changes hands and that this formed part of the purchase price.  I do not know if rent is applicable after transfer for the seller depending on the rent charged in the interim period until transfer.”

[64] Also on 10 June van der Lingen addressed the following email to van der Hoogen and Mjemla:

“Dear all, from the purchase and sale it follows that income from any activities conducted on the farm, even by third parties, goes to the registered owner.”

[65] On 22 June van der Lingen sent an email to Mjemla also copied to van der Hoogen and Mbekeni in which he referred to certain lease agreements relating to activities conducted on the farm and stated further as follows:

“What remains is for the Deeds of Sale to be signed.  Kindly find attached the second draft providing for undertakings and not guarantees ...  Please also note the inclusion of the final paragraph in the estate properties contract pertaining to the take-over of labourers’ contracts. ...  Can we please have the agreement signed as quickly as possible.”

[66] On 22 June Ms. Mbekeni sent the following email to van der Lingen:

“Deed of Sale Troskie Trust to RSA Second Draft

This Deed contains three new suggested clauses.  Please peruse and include same in the second Deed.  Please then forward the documents for the signatures.”

[67] Attached to this email were two Deeds of Sale.  It appears therefrom that three clauses had been included which had not appeared on the previous draft.  These clauses concerned “Certificate of Compliance, Farming Practice and Dispute Resolution” as well as a clause indicating that the sale was free of VAT in that the State was not a VAT vendor. 

[68] Van der Lingen effected the amendments and, on 22 June, addressed the following email to Mbekeni, copied, inter alia, to van der Hoogen in which he stated as follows:

“Kindly find attached the amended Deeds of Sale incorporating your proposed amendments.  I have also amended par 4 pertaining to VAT.  The department will need to supply me with a letter confirming that the transaction is one as envisaged in the Provision of Land and Assistance Act no 126 of 1993.  SARS will require such a letter emanating from your department in order to give tax clearance.  I am awaiting the signed Deed after which I will also sign and proceed with the transfer.

[69] On 23 June Mbekeni replied stating that she would forward the Deeds of Sale for signatures.  On 23 June Ms. Mjemla sent an email to van der Lingen copied to van der Hoogen stating “Thanks for the quick response.  Kindly be advised that our legal officer Ms. Mbekeni will look at the documents and advise you. 

[70] During July van der Lingen requested to know from Ms. Mbekeni what progress was being made with the matter, eventually on 14 July sending an email to her stating:

“I forwarded the Deeds of Sale to the department on the 22 June.  Everyone was very anxious to get the Deed of Sale finalised.  I have now been waiting for almost a month for the Deed to be signed.  Can you please give me an update as I am inundated by calls from the seller.”

[71] Eventually on 19 July van der Lingen advised Mbekeni by email that in view of the delay “the seller has instructed to convey that the proposed offer to sell will be withdrawn should we not have received the signed deed of sale within the next fourteen days.” 

[72] Following upon this van der Hoogen addressed an email, inter alia, to Mbekeni and Mjemla, stating that this was a simple request and asking why there was a delay.

[73] On 29 July van der Lingen sent an email to Mjemla stating:

“Andre van der Hoogen has informed me that the Deeds of Sale for the above properties have been signed.  I urgently need a copy of the signed agreement to put my client’s mind at rest.”

[74] On 1 August Mjemla informed van der Lingen that “the Chief Director has signed the Deed of Sale for the properties.”

[75] The final signed Deeds of Sale were then delivered to van der Lingen for signature.  Having signed the Deeds of Sale on behalf of the purchaser they were returned to the State.  At no stage was the issue of the indemnity in clause 24 raised by any of the State officials with van der Lingen.   

[76] Mr. Andre van der Hoogen, the Senior Manager, Land Acquisition and Warehousing, of the Department of Land Affairs testified that part of his duties entailed assessing every valuation obtained in all nine provinces in respect of the purchase by the State of land.  The necessity for him to do so arose because of financial damage occasioned to the State in consequence of collusion between valuers and sellers whereby the value of land to be purchased by the State was inflated. 

[77] Van der Hoogen testified that upon receiving van Rensburg’s valuation of Craig Gowan he was concerned about certain aspects thereof, more especially with regard to van Rensburg’s employment of comparable sales figures in order to arrive at his valuation as well as by the nature of the farm.  He was accordingly of the opinion that the valuation of R20 million was excessive.  Because of his misgivings as to the correctness of the valuation he decided to inspect the farm personally. 

[78] He accordingly travelled to Cookhouse.  In this regard he confirmed the evidence of Troskie as to their discussions and as to the fact that he had travelled to another farm where he had met up with an estate agent, Lotter, as well as a certain Mr. Mazwai the intended beneficiary of the farm.  He confirmed that the meeting with Lotter had nothing to do with Craig Gowan. 

[79] The following day he met Troskie, van der Lingen and Abrahamson at the latter’s offices in Somerset East.  There was a discussion concerning the possible involvement of any estate agent in the sale of Craig Gowan.  In this regard mention was made of the contracts which had previously been signed by the deceased and which he was informed were null and void.  He stated that at that stage he had never met Potgieter nor was he aware of her alleged involvement in the matter.  He informed those present that no agent had taken him to the farm and stressed that the State in general did not pay commission.  He conceded, however, that he could not exclude the possibility of an agent having become involved prior to his own involvement.  He denied that Troskie had told him that he would accept the sum of R17,5 million on condition that no commission was payable to any agent, stating that “die storie van hy sal dit nie aanvaar as daar nog kommissie moet bykom, ek koop dit nie.”  He eventually conceded, somewhat reluctantly, however, that it was logical for the sellers to have wanted indemnity in case it was established that an estate agent was the effective cause of the sale. 

[80] It was put to him that he had agreed that the indemnity clause could be included in the agreements.  In a rambling reply of more than a page of transcript he stated that he had no executive authority to agree to an indemnification by the State of the seller in respect of agent’s commission.  The ultimate authority lay with the Provincial Technical Committee which was why the later negotiations were conducted with Ms. Mjemla.  He denied having told van der Lingen that he was prepared to offer any such indemnity to the seller.  As far as he was concerned his responsibility ended once he had made the recommendation as to the purchase price.  He later also became involved when van der Lingen had expressed his frustration at the delays in the matter in response to which he had asked the provincial office to expedite matters.  With reference to van der Lingen’s email of 10 May 2011 (D1) he eventually conceded, after some considerable cross-examination, that he must have spoken to van der Lingen but averred that he was at the time under very considerable pressure at work and reiterated his denial that he would have told van der Lingen to include the indemnity clause in the contracts.  He stated that “daar word verwys na ‘n enkele epos waar daar ‘n telefoongesprek plaasgevind het maar daarna is daar nooit weer ‘n epos gestuur om te sê my ou vriend hier is nou die klousule wat ek en jy oor die telefoon gepraat het en dit is waaroor ons ooreengekom.”

The import of his evidence was that the indemnity clause had been inserted in the agreements by van der Lingen in an underhand manner by not pertinently drawing his attention to its presence in the draft agreements.

[81] Ms. Nomahlubi Mbekeni, the Senior Legal Administration Officer of the East Cape Provincial Office of the Department of Rural Development and Land Reform, stated that during 2011 she was a legal administration official and the person who, in the course of her duties, had to communicate with van der Lingen concerning the content of the two Deeds of Sale. 

[82] She confirmed that she had received them, had read them, and had suggested certain alterations to them as well as inserting some new clauses herself. 

[83] She confirmed that the agreement relating to the estate property contained clause 24 in respect of agent’s commission.  She accepted this clause as having been correctly included in the Deed of Sale and did not pay particular attention to it.  At that time she was not aware of the involvement in the matter of any estate agent. 

[84] She confirmed that none of the correspondence addressed to her had specifically drawn her attention to clause 24.  Had she been made aware of the fact that estate agents were demanding commission she would have advised that the clause be deleted.  However, she conceded that she had at no stage advised the person who ultimately signed the Deed of Sale on behalf of the government that she was not satisfied with the indemnity clause.  She further conceded the possibility that plaintiff had indeed introduced the government to the property. 

[85] She stated further that the provisions of clause 24 were exceptional.  She said that she had spoken to Mjemla about the contracts but Mjemla was happy therewith.  She confirmed that she had never been misled by van der Lingen in respect of clause 24 and she agreed that in the circumstances the clause was enforceable.        

[86] The issue as to whether plaintiff had been afforded a mandate; whether she had introduced the properties to the third defendant and whether she was the effective cause of the sale of the properties to the third party can readily be disposed of.  The legal principles in this regard are trite.  See for instance Munitz v Steers Trust Co (Pty) Ltd 1993 (2) SA 369 (C) at 390D – 391E; Aida Real Estate Ltd v Lipschitz 1971 (3) SA 871 (W) at 873H – 874A; Nach Investments (Pty) Ltd v Knight Fank SA (Pty) Ltd [2001] 3 All SA 295 (A) at para 7 – 10 per Nugent AJA (as he then was) and, in particular, Tyrone Selmon Properties (Pty) Ltd v Phindana Properties 112 (Pty) Ltd [2006] 1 All SA 545 (C) at para 17 – 20.

[87] Although Mr. Schoeman S.C., who appeared for defendants, criticised Potgieter’s evidence as being to some extent evasive and unsatisfactory I am satisfied, as was submitted by Mr. Huisamen S.C., who appeared for plaintiff, that her evidence can be accepted as reliable in its salient respects, more especially as it was not seriously disputed under cross-examination by either Mr. Schoeman or by Mr. Ronaasen S.C., who appeared for the third party.

[88] That evidence discloses that Potgieter had been afforded a mandate by the deceased to sell the properties and that in so doing he was acting both in his personal capacity and in his capacity as a trustee and duly authorised representative of the trust.  It is not necessary to deal with the issue of deceased’s authority in any detail.  In my view it is clear that he was authorised to represent the trust in terms of the resolution of the trust (Exhibit A) dated 19 January 2000.  The defendants did not dispute deceased’s authority and, indeed, Troskie recognised deceased’s authority in this regard stating that deceased was “die baas van die plaas.”  It is also clear that in compliance with the mandate Potgieter introduced the relevant officials of the third party to the properties by, inter alia, compiling a power point presentation and supplying the third party with all relevant information pertaining to the properties which in turn led to the opening by Ms. Sibonyani of a file with number PE/6/3/9/S7/40 which number remained with the file until the completion of the sale.  She further supplied information and details of the properties to the valuator, van Rensburg, who had been appointed to do the formal valuation of the properties.

[89] It is clear, having regard to Potgieter’s evidence, that the final agreements of sale were concluded as a direct consequence of the third party’s introduction to the properties by Potgieter.  Potgieter’s evidence encapsulates this as follows:

“I was the only person that was there from the beginning and the first intent to sell and it was my information that was given through the whole process that was used by the valuator and it was my information, the valuation and the information was requested from me...  Mr. Troskie Jnr was aware that his father entered into an agreement with me to sell the farm, the valuation was done, the offer to purchase was written, the commission was agreed upon and no other estate agent was involved in that whole time period.”

[90] As I have said, Potgieter’s evidence was not seriously disputed nor was any evidence led by the defendants or indeed the third party to gainsay Potgieter’s evidence.  I am satisfied therefore that plaintiff has discharged the onus of proving that it introduced the properties to the third party; that it was the effective cause of the eventual sales of the properties; and that plaintiff is therefore entitled to be paid its commission accordingly. 

[91] That leaves the issue of the indemnity clause contained in the deeds of sale to be determined. 

[92] Mr. Troskie was a good witness against whose evidence no criticism could be advanced by Mr. Ronaasen.  Mr. van der Lingen was, in my view, an excellent witness whose evidence fully corroborated that of Mr. Troskie and whose evidence was also, in my view, fully in accordance with the probabilities of the case. 

[93] The evidence of Mr. van der Hoogen was, however, very much more problematic.  I believe he was an honest witness but he was his own worst enemy in the witness box.  He appeared to have great difficulty in providing direct answers to questions which resulted in those questions having to be repeated, on one occasion at least six times, before he finally gave a pertinent reply.  This in turn caused him to become agitated as the following evidence illustrates:

“Dit is wat soos u eie hoofgetuie of Mr. Andre die prokureur ook gesê het hy raak ook nou warm om die kraag, nou moet nie my warm om die kraag maak nie asseblief.

Mr. Schoeman:         Meneer antwoord net die vraag.

Answer:                      Moet nie aanhou met dieselfde ding om te hê ek moet nou my woorde verander nie, ek vra jou mooi asseblief, baie dankie.

Mr. Schoeman:         Meneer, antwoord die vraag asseblief.

Court:                         Meneer van der Hoogen, Meneer Schoeman mag daardie vraag vra, daar is geen probleem met wat hy vra nie.

Answer:                      Nee maar Edelagbare hy kan nie aanhou en aanhou laat ek nou my woorde moet verander nie, ek het vir hom reeds gesê hoeveel keer ek het vir hom genoem dat nie ‘n agent betrokke was om my aan die plaas voor te stel nie, voor te stel, voor te stel, voor te stel, voor te stel.  (sic)

Court:                         Ek dink as die vraag onbillik is of ontoelaatbaar is sal Meneer Ronaasen dan beswaar maak.  Hy hanteer die Regering se saak en ek dink u raak nou warm onder die kraag, asseblief.  Calm down the questions that had been put by Mr. Schoeman have so far been perfectly acceptable.”

[94] Unfortunately Mr. van der Hoogen’s evidence continued in much the same manner leading me to address him as follows:

“Mr. van der Hoogen ek sit hier, ek is die arme persoon wat nou moet probeer vasstel waar lê die waarheid.  Mnr. Schoeman tree op namens sy klient en hy mag hierdie vrae vra.  With great respect to you, you do not do your case any good if you lose your temper, it does not help me, it does not help your client, so just please calm down and let Mr. Schoeman put his questions without expecting him to try to lead you around the bush as it were.  The only way that we can actually resolve this issue is if everybody just keeps calm and just listens to the questions and answers them.  As I say, if Mr. Ronaasen feels that a question is out of line, he will stand up and object, but up to now there is no basis on which he could have objected.”

[95] It was clear from his evidence that he was under considerable pressure at work at the time and it may be, adopting a generous approach to his evidence, that his recollection of his discussions with Troskie and van der Lingen was not complete.  Whatever the position may have been he eventually conceded that it was entirely logical for the sellers to have wanted an indemnity in case an estate agent was in due course found to have been involved.  This concession was made despite his earlier response to this proposition being that he “verwerp dit met minagting.”

[96] In my view the probabilities are overwhelmingly to the effect that there was a discussion concerning the possible involvement of an estate agent and, in the light thereof, an insistence by Troskie that an indemnity clause be inserted in the contracts if the purchase price was only to be R17,5 m.  Having regard to the principles set out in National Employers General Insurance Company Ltd v Jagers 1984 (4) SA 437 (E) I have no difficulty whatsoever in accepting the evidence of Troskie and van der Lingen as entirely credible in this regard.

[97] In the light of this evidence Mr. Ronaasen was, not surprisingly, obliged to concede in the course of his submissions that van der Hoogen must in fact have agreed that the indemnity clause could be inserted in the contracts.  This concession was inevitable in the light of the evidence and of the contents of the email, D1. 

[98] In the light of the evidence as a whole there can be no question, in my view, of there having been any common mistake as to the involvement of any estate agent in the sale of the properties, as contended for by the third party.  It is clear that Troskie and van der Lingen were at all times aware of claims in respect of the properties by estate agents, especially Potgieter, and that they advised van der Hoogen thereof at the Somerset East meeting.  The contents of the email of 10 May 2011 (D1) establishes beyond any doubt whatsoever that van der Hoogen was advised, prior to the inclusion of the indemnity clause in the deeds of sale, of the involvement and claims of Potgieter.  Van der Hoogen’s much stated assumption that no estate agent was involved was clearly not shared by the defendants.     

[99] There can also, in my view, be no question of any justus error on the part of the third party.  Mr. Ronaasen submitted in particular that the defendants had failed to inform van der Hoogen and the relevant officials of the third party of the fact that they had received a formal demand from the plaintiff.  This submission is in my view devoid of merit.  It is given the lie by the contents of Exhibit D1 as well as the evidence on behalf of the defendants.  Whatever misapprehension van der Hoogen was labouring under was not caused by any conduct or misrepresentation on the part of the defendants.  The insinuation by van der Hoogen that van der Lingen had acted in some underhand manner by in effect surreptiously inserting the indemnity clause into the agreements is entirely unwarranted and unfortunate and I reject it.  Of particular relevance in this regard is that van der Hoogen himself had had regard to the draft deeds of sale, which included the indemnity clause, under a prominent heading, prior to their being signed, and had suggested certain changes thereto, namely, for instance “I would like to see that the contract provides for the towers and wind land income” and that he must therefore have read through the relevant deeds.  In this regard van der Hoogen stated that he was under huge pressure at the time and therefore could not say that he had read the entire contracts because that was not his duty.  In my view this explanation is utterly improbable.  It was in any event then contradicted by van der Hoogen himself who stated that he could not in fact remember whether he had read the entire contracts.   

[100] Mr. Ronaasen submitted with reference to inter alia Leite v Leandy and Partners 1992 (2) SA 309 (D) at 320 F – G that van der Lingen had been under an obligation to draw the attention of the officials of the State involved in the negotiation and signing of the contracts to the indemnity clause, to advise them of the reason for its inclusion and to fully explain the import and consequences thereof.  In my view there is, again, no merit in this submission and the Leite case is clearly distinguishable.      

[101] In the present matter the indemnity clause which was prominently included and open for all to see, and which van der Hoogen must have seen, was entirely consonant with the discussions between Troskie, van der Lingen and van der Hoogen and there is no basis on which it can be contended that van der Hoogen or any other official was justifiably misled by it.  Compare: Absa Bank Ltd v Trzebiatowsky and Others 2012 (5) SA 134 (ECP) per Revelas J.  This is to say nothing of the fact that van der Hoogen had agreed to its inclusion and that, despite this, he apparently took no steps to inform the State signatories to the contracts of the communication between himself and van der Lingen as evidenced by the contents of D1.

[102] In this regard the evidence of Ms. Mbekeni is conclusive.  She read the draft deeds, suggested alterations, and inserted certain new clauses therein.  She was fully aware of the indemnity clause and of its import but was content to accept it.  So too was Mjemla to whom she spoke about it.  She confirmed that no misrepresentations had been made to her and that the clause had not been mistakenly inserted in the contracts.

[103] In the circumstances the indemnity clause is enforceable against the third party. 

[104] Counsel were agreed that in the event of the Court coming to the finding which I have, judgment should be given against the third party in terms of a draft order prepared by Mr. Schoeman, which draft order includes a prayer for costs on the scale as between attorney and client in terms of the agreements.

[105] The following order will issue:

1.    Judgment is given in favour of plaintiff against the defendants as follows:      

Against the First, Second, Third and Fourth Defendants, in their capacities as Executors of the deceased estate and against Fifth, Sixth and Seventh defendants, in their capacities as Trustees of the Trust, jointly and severally:

a.    Payment of the sum of R475 000,00 plus VAT, as and for estate agent’s commission, alternatively as and for damages.

b.    Interest on the said sum calculated at the prevailing legal rate a temporae morae;

c.    Costs of suit.

2.    Against the Fifth, Sixth and Seventh defendants, in their capacities as Trustees of the Trust:

a.    Payment of the sum of R400 000,00 plus VAT, as and for estate agent’s commission, alternatively as and for damages;

b.    Interest on the said sum calculated at the prevailing legal rate a temporae morae;

c.    Cost of suit

3.    Judgment is given against the Third Party as follows:

3.1 The Third Party is liable to pay to the Defendants such amounts as the defendants have been ordered to pay the plaintiff together with interest thereon at the prevailing legal rate from 14 days after date of judgment to date of payment;

3.2 The Third Party is ordered to pay the plaintiff’s taxed party and party costs recoverable from the defendants together with interest thereon at the prevailing legal rate from a date 14 days after judgment to date of payment

3.3 The Third Party is ordered to pay the defendant’s taxed costs on an attorney and client scale together with interest thereon at the prevailing legal rate from a date 14 days after judgment to date of payment

3.4 The aforementioned costs are to include the costs of perusal of the court record and of the preparation of Heads of Argument by counsel.

___________________

J.D. PICKERING

JUDGE OF THE HIGH COURT

 

Appearing on behalf of Plaintiff: Adv. Huisamen S.C

Instructed by: Moya Rossouw c/o Huxtable Attorneys, Mr. Huxtable

 

Appearing on behalf of Defendant: Adv. Schoeman S.C

Instructed by: Whitesides Attorneys, Mr. Nunn

 

Appearing on behalf of Third Party: Adv. Ronaasen S.C

Instructed by:  State Attorneys, c/o Dullabh Attorneys, Mr. Wolmarans

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