- It was conceded upon trial that the plaintiff is an estate agent who at all
relevant times was the holder of a valid fidelity fund certificate issued
pursuant to the provisions of section 26(a) of the Estate Agency Affairs Act,
No. 112 of 1976. It was also accepted during the trial that the amount
claimed in prayer (i) represents the commission that she would have been
entitled to earn assuming she proved that she duly performed in terms of the
mandate in question.
- The plaintiff pleaded that “(i)n or about July 2008, (she) introduced one
AGGREY MAHANJANA to the said immovable property and as a direct
result of this introduction, the National Government of the Republic of South
Africa purchased and took transfer on 19 May 2009 of the aforesaid
immovable property at a purchase price of R6 800 000.00 … VAT
exclusive”. Thus she performed in terms of her mandate, was the effective
cause of the sale, and is entitled to payment of the agreed commission.
Reference was made to the deed of sale - attached to her particulars of claim
marked Annexure “A” - which was the precursor to the transfer.1 In terms of
paragraph 21 thereof, the seller was to be liable for the payment of any
agent’s commission in respect of the sale.
- The defendant admits that Mahanjana was introduced to the property, but
denies that as a direct result of this introduction – or indeed at all - the deed
1 Annexure “A” is a memorandum of agreement of purchase and sale entered into between the defendant and
the national government, represented by Dr Daliwonga Armstrong Matta, in his capacity as chief director: East
Cape Land Reform Office. The last date of signature of the agreement ‐ which according to Clause 12 thereof is
the effective date of sale ‐ is 24 February 2009. It is evident from correspondence included in the plaintiff’s
bundle (Exhibit 17 – 18 and 19) that the sale is a land reform transaction and that transfer was registered on
the basis that approval for the acquisition was obtained pursuant to the provisions of section 10(1)(b)(i) of the
Land Reform : Provision of Land and Assistance Act, No. 126 of 1993.
3
of sale (Annexure “A”) was entered into; that the plaintiff was the effective
cause of that sale, or that she performed her obligations in terms of the
mandate. That Annexure “A” co-incidentally referred to estate agent’s
commission did not, so it was pleaded, establish her entitlement to payment
in the absence of any causal connection between the introduction and
conclusion of the sale ultimately to the government.
- The defendant adverted to a prior agreement (which I will refer to as the
“Anne Chamber’s agreement to purchase”) which was entered into on 14
July 2008 between the defendant and the National Emergent Red Meat
Producers Organisation, Eastern Cape (“NERPO EP”), which he conceded
on the pleadings had indeed been concluded in furtherance of the agreed
mandate. In terms of this agreement he purported to sell his property for an
amount of R9.5 million, which purchase consideration included value for
farming equipment and assets in an amount of R2 million. The sale was
subject to a suspensive condition concerning the approval by the Department
of Rural Development and Land Reform (“the department”)2 and the
furnishing of guarantees by 30 November 2008. In the absence of the
guarantees having been supplied by the agreed upon date, however, the
agreement fell away, and the introduction of Mahanjana was accordingly to
no effect.
- The plaintiff testified that in 2007 she was asked by the department to find
farms for “their beneficiaries”.3 She did so on a full time basis from 2007
in conjunction with a separate agency, Jorita Properties, of which Gerald
2 Previously the Department of Land Affairs
3 It is common cause that these persons are emerging black farmers whom the department seeks to benefit for
land reform purposes.
4
Tessendorf - a relative of hers - was the principal agent. The nature of the
formal arrangement between her agency and his concerning these deals was
one of co-operative agreement.4
- One such beneficiary for whom the plaintiff sought to find a farm was
Mahanjana associated with the national office of NERPO. He was looking
for a cattle or vegetable farm.
- She had learnt from a friend that the defendant’s farm was for sale and
approached him with a view to discussing his requirements. After giving her
a guided tour he indicated that his price was R9.5 million, inclusive of
implements and equipment. He confirmed that she could bring a buyer,
which culminated in the formal mandate to her. It also emerged that there
was some urgency for him to dispose of the property Not only had the
mortgagor, Standard Bank, threatened to repossess the land, but he was in
the throes of a divorce action and the purchase by the Defendant’s wife of an
unrelated property was dependent on the proceeds of the transfer of
Weltrevreden.
- An earlier prospective purchaser fell by the way side, but in July 2008 she
made arrangements with the defendant to bring Mahanjana to view the farm.
The latter flew down from Pretoria and the plaintiff drove him to
Queenstown where he was shown it in the presence of the defendant and his
wife.
4 It was not in dispute that Tessendorf is similarly the holder of the necessary fidelity fund certificate.
5
10.Mahanjana liked the property and indicated that he would like to purchase it.
She later took Reverend Mxekezo, the local NERPO representative, to the
farm. This culminated in the offer to purchase on her agency’s template
dated 14 July 2008 (the Anne Chamber’s agreement), which was signed by
Mxekezo on behalf of NERPO EP and by the defendant on the same date.
Her limited understanding of the conditional clause in the agreement was
that NERPO would buy this farm “through” the department, i.e. they would
fund the purchase.
11.A week later she forwarded the offer by facsimile to the defendant’s
conveyancing attorneys, De Waal-Baxter. In the covering letter she
confirmed that she had “already handed same to the Department of Land
Affairs, Queenstown” and that she would keep the attorneys updated. The
agreement was given to one Mr. Boltina of the Queenstown district land
reform office. He was the project leader concerned with the sale of the farm
to Mahanjana. She anticipated that what would unfold thereafter was “the
rest of the procedure of the sale of the property”.
12.On 28 July 2008 De Waal-Baxter acknowledged receipt of the agreement
and requested to be informed as soon as the plaintiff heard from the
department.
13.Thereafter she claims that she and Tessendorf maintained regular telephonic
contact with the Queenstown office to track the progress; with the defendant
to keep him updated (because she was particularly concerned for his plight);
and with Althea Petzer, a conveyancing secretary in the employ of De Waal-
Baxter. On one occasion she and Tessendorf personally attended at the
6
Queenstown office in order to introduce themselves and to enquire as to the
progress of the acquisition. She also claimed both to have informed the
department of the defendant’s dire financial circumstances, and to have
initiated the procurement from it of a “to whom it may concern” letter to
assuage Standard Bank to hold legal proceedings in abeyance when it was
pressing to dispose of the property by sale in execution.5
14.With reference to a letter in the plaintiff’s bundle6 addressed by the
department to the defendant dated 5 November 2008, she acknowledged
being informed that it had subsequently valued the defendant’s property at
R6.8 million and that De Waal-Baxter had replied to them indicating their
client’s acceptance of the offer and acknowledging that the price excluded
any implements, and vat such as was applicable.7 Concerning the attorneys’
request to let them have details of the purchaser to draft a formal deed of
sale, the plaintiff remarked that this was “normal” procedure. What she
meant thereby, she explained, is that once the valuation was accepted and the
seller was happy with everything, a new deed would be prepared which
would ultimately be signed by Mr. Dali Matta, the Chief Director of the
Eastern Cape Land Reform Office.
5 This is a letter dated 18 December 2008 addressed by the district director of the Queenstown office, Ms
Malerato Molokoane, to Standard Bank requesting them to hold back the sale in execution because of the
successful approval of the sale. Different copies of the letter were included in the plaintiff’s bundle marked A
12, A 49 and Exhibits “C” and “D”. The copies differ with reference to handwritten annotations and fax
transmission reports on each of them.
- This is a letter addressed by the department directly to the defendant informing him of the outcome of the
valuation and requesting him to confirm that the price is acceptable in order to submit the project to the
district screening committee which was to meet on 11 November 2008 (Exhibit A 10).
7 Exhibit A11.
7
15.She pointed to a further letter in the bundle dated 22 January 20098
addressed by De Waal-Baxter to the department requesting information to
draft the deed in which reference is made to an earlier fax addressed by them
to the “Estate Agents” confirming that it had approved the sale of the farm.
She claimed this as proof of her involvement at the time since there were
there were no competing agents who had an interest in the transaction; and a
later letter addressed by the department to the conveyancing attorneys9 as
evidencing the department’s acknowledgement of her interest in the
transaction beyond 30 November 2008. This is because a fax report at the
head of the letter confirms that the letter was copied to her by the department
on 2 February 2009.
16.She agreed that she had no role to play in the drafting of the new deed of sale
(Annexure “A”), but was confident that all the information concerning the
transaction was in the original Anne Chamber’s agreement. She added that,
since she and Tessendorf were in constant contact with the department, they
would not have hesitated to give them anything they were looking for. Since
they had sold a number of farms like this, she knew that the deed would be
drawn up between the seller, the government and the beneficiary - with Mr.
Matta as signatory on behalf of the latter.
17.Her expectation that commission was to be paid in respect of the transaction
was dashed on the date of registration of transfer. She adverted to a fax
letter addressed to her by De Waal-Baxter dated 19 May 2009,10 sent on the
morning of registration of transfer, in which the defendant’s liability for
8 Exhibit A13.
9 Exhibit A15.
10 Exhibit A20.
8
commission was disavowed for the first time. The contents of this
communication are to the following effect:
“SALE: BURGER TE / NATIONAL MERCHANT RED MEAT PRODUCERS
ORGANISATION
We advise that the aforementioned sale to the National Merchant Red Meat Producers
Organisation was subject specifically thereto that the sale be approved by the Department of
Land Affairs and guarantees issued by 30 November 2008.
The sale was in fact not approved, nor was the guarantees received and the sale therefore fell
away.
A new Deed of Sale was negotiated, without your intervention and without any input from
your agency, in which a new buyer was determined, a new purchase was negotiated and the
subject matter of the sale was also different.
In the light of the circumstances we have received instructions from Mr. Burger to repudiate
your claim for agent’s commission on the basis that you were not the effective cause of the
sale and as such not entitled to agent’s commission.”
18.Her surprised reaction to this disavowal is set out in the transcript of
evidence at page 68 as follows:
“… we signed the Deed of Sale with Mr. Burger. We did everything we had to do. We
explained to him how the procedure worked. As far as the new Deed of Sale was concerned,
it’s normal procedure that we’re not involved there. We’ve done our work. That date had
expired. We did ask Mr. Burger to extend it. There was a land claim on the property. And he
said no, please don’t. We don’t want to delay matters any further. We want to continue with
the same Offer to Purchase. He didn’t want us to draw up a new Offer to Purchase because he
was scared it was going to delay the matter further. He didn’t want any more delays.”
19.On pages 69 and 72 respectively she also highlighted her confusion around
the defendant’s repudiation of her claim for commission as follows:
9
“I can’t understand where he’s coming from …. We did the sale, we took Mr. Burger – we
made appointments with him, we took the client to the farm, he purchased the farm through
us. And the date did expire – we wanted to draw up a new Offer to Purchase and he didn’t
want to. He said we must use the existing one; he doesn’t want to delay the matter any
further. So I don’t know – I can’t understand where they’re coming from. I was the effective
cause of sale; I did introduce my buyer to the property.”
“Can you tell Her Ladyship whether or not on any previous occasion Mr. Burger had given
any indication of repudiating liability for commission? --- Nothing whatsoever, Your Honour,
I was totally shocked. I just couldn’t believe it.”
20.Under cross examination the plaintiff persisted that a deed of sale in the form
of Annexure “A” was the norm and that the government was the purchaser
notwithstanding what the Anne Chamber’s agreement indicated. She
explained that this was just an offer and that a formal deed was expected to
follow once a valuation was effected. She appeared unable to understand the
defendant’s submission that the offer became the enabling deed of sale once
it was accepted by him. She also appeared unable to understand the effect in
law of the suspensive condition in her agreement, but added that the
defendant had in any event specifically mandated her not to “renew” the
offer after 30 November 2008. She took this to be the “go-ahead” to
continue on the basis of the original agreement until registration of transfer.
She agreed that a new offer to purchase would indeed have been necessary
post valuation and acceptance by the defendant to reflect the reduced
purchase price, but insisted that this need was countermanded by his specific
request to keep matters as they were.
21.She was unable to verify with regard to telephone or files notes the occasions
on which either she or Tessendorf phoned or with whom they spoke, but her
common refrain was that they had been in “constant contact” with the
10
defendant, the department and Althea Petzer. She remained convinced that
she was responsible for the “to whom it may concern letter” dated 18
December 2008. She must have requested it, so she suggested, otherwise the
reference in De Waal-Baxter’s letter dated 22 January 2009 concerning the
department’s earlier fax to the “Estate Agents” could not have arisen. She
could only imagine that it must have been faxed to her contemporaneously.11
22.She rejected the assertion that that district director, Molokoane, could not
have known of her involvement in the matter, insisting that she and
Tessendorf had gone to her office to introduce themselves to her. She could
not be specific, however, as to the date when this took place.
23.The plaintiff appeared unversed with the workings or the effect of the two
applicable financing models in place at the time by the department to assist
emerging farmers in the acquisition of farming property for land reform
purposes or of the internal processes which had unfolded concerning
Mahanjana’s dealings with the department after the initial offer was
submitted.12 In this regard, whilst conceding on the one hand that NERPO
wanted to acquire Weltevreden for its own purposes and to have title over it
rather than to simply become a beneficiary, she was otherwise confident that
Mahanjana had always said that the government would own the property.
24.Despite her obvious lack of knowledge concerning the financing models or
internal procedures of the department she insisted, however, that she and
11 That it was faxed is evident from both Exhibits A12 and “D”, since the plaintiff’s fax numbers appear at the
top of these. The only clear fax report, however, is 7 July 2010 on A12.
12 These programs, outlined later in the plaintiff’s case, per Messrs Tessendorf, Mahanjana and Matta, are
referred to below.
11
Tessendorf had explained these “very clearly to (the defendant)”. When
asked to explain it in her own way, she stated as follows:
“I was asked to find them farms, to find client a farm. I found him the farm, took him to the
farm, he signed for it through his representative, because I went more than once to the farm.
Mr. Burger accepted it. We then handed it in to the Department of Land Affairs and as well
gave it to Baxter-de Waal. And the procedure after that is a project leader was appointed to go
and look at the farm, then the valuation gets done, which was done. We told Mr. Burger what
the valuation was when it came back. He accepted the valuation.”
25.She was not clear when or where they had informed him, but the plaintiff
was insistent she and Tessendorf had informed the defendant of the
department’s valuation. Her recall was that the department had phoned them
since it was the agency’s obligation to “get back to the seller”. She was not
put off by the fact that the letter advising of the valuation was personally
addressed to the plaintiff. She dismissed this as “standard procedure”.
26.She denied that her contact with the defendant concerning the transaction
ended “more or less around the beginning of November 2008” or that her
contact with Althea Petzer was limited on the basis put to her by Mr. Kincaid
who appeared for the defendant.13
27.She conceded that she only met Ms Molokoane after May 2009, but could
not remember the date. She rejected any criticism of her handling of the
matter as an agent by Molokoane’s exacting standards, stressing that they
13 These assertions put to the plaintiff were never confirmed in subsequent testimony. Neither the defendant
nor Althea Petzer was called as witness. Significantly, however, it was put to the plaintiff that she had
(contemporaneously) faxed to Petzer a copy of Molokoane’s “to whom it may concern letter” which the
plaintiff had apparently sourced from Dawn Kemp Estates, the other agents interested in the defendant’s
wife’s property transfer.
12
had done the “normal” thing expected of them, viz to keep in contact with
the department and transferring attorneys.
28.Finally, once she was able to understand this, the plaintiff conceded that the
introduction of Mahanjana to the farm (in relation to Annexure “A”) was not
direct, but rather an indirect one. Still she maintained that this entitled her to
payment of the commission pursuant to the ultimate sale of the farm to the
national government.
29.Mahanjana, the national chief executive officer of NERPO, testified on
behalf of the plaintiff. He is also a trustee of the NERPO Farming
Enterprises and Development Trust, the entity which currently leases
Weltreveden from the government through the department. The trust is an
independent entity, albeit a section 21 subsidiary of NERPO which acts in
the latter’s interests in the acquisition of land used to train emerging farmers.
The organisation relies for the realisation of its projects on government
financing these purchases or bestowing the land upon it for “free” in the
form of a free-lease agreement.
30.He acknowledged the plaintiff as an estate agent who had acted in NERPO’S
interests before in introducing farming property in the Chris Hani/Matola
district and who had shown “Weltreveden” to him.
31.He identified the Anne Chamber’s sale agreement as the one signed by the
chairperson of the provincial branch which had been entered into with the
defendant. He agreed that it had never been envisaged that NERPO would
13
be funding the purchase by way of a mortgage bond, given the special
suspensive condition contained in the agreement. The manner in which this
provision was framed he attributed to the plaintiff’s role in looking for
property on behalf of government, the acquisition of which they would look
at financing.
32.He explained the two land redistribution models employed by the department
for land reform purposes which were in place at the time pursuant to which
they might “take over” properties identified by the plaintiff which piqued
their interest. The first program – Land Redistribution for Agricultural
Development (LRAD) - operated on the basis that government would award
a grant to a maximum of R400 000.00 per qualifying beneficiary to purchase
the land.14 In practice, since farm values invariably exceed the maximum
grant and in order to gain advantage of this program for its acquisitions,
NERPO would combine members to make up a sufficient number to meet
the purchase price. The beneficiaries would own the land with government
exercising no control post registration.
33.The second program - which came after LRAD to address the difficulties
occasioned by the large numbers of beneficiaries involved in a single
purchase15 - is called Proactive Land Acquisition Strategy (PLAS).
According to this model, a beneficiary identifies a property in which he is
interested. Government purchases it on the latter’s behalf but leases it to the
beneficiary who enjoys first option to purchase once government thinks he is
ready and productive on the farm.
14 Molokoane testified that this grant was R434 000.00 per beneficiary, but nothing turns on this.
15 A further difficulty, it later emerged during the hearing, was that owners who had acquired property
courtesy of the LRAD strategy were on‐selling these to white farmers, thus defeating the department’s
objective to acquire 30% of the country’s arable market by 2014.
14
34.He agreed that it was the “duty” of the plaintiff, after conclusion of the sale
secured by her, to “facilitate” the process with the department in accordance
with their finance models. He was aware - and indeed it is common cause -
that financial approval was not furnished by 30 November 2008. He learned
as much from the project leader, Mr Boltina, of the Queenstown district
office, with whom he was in telephonic contact almost on a daily basis
concerning the transaction. To his knowledge the application failed on the
LRAD system but, subsequent to 30 November 2008, was approved under
PLAS. He remembered that such approval coincided with his year end
holiday. He was further made aware, both by the defendant and Boltina that
the monies for the purchase would only become available in the next
financial year, commencing on 1 April 2009.
35.He identified Annexure “A” as the effective agreement employing the PLAS
system and acknowledged the absence of NERPO EP being described as the
purchaser in it. He also identified the lease agreement entered into between
the government and NERPO Farming Enterprise Development Trust, signed
by him in his official capacity, as being the vehicle through which NERPO’s
interest in the land for its purposes was ultimately realised (Exhibit “B”).16
36.He testified finally that, between the signing of the initial agreement
(including the period after 30 November 2008) and the culmination of his
organisation as lessee in respect of the property, the defendant contacted him
on a regular and frequent basis enquiring about the progress of the matter.
16 It seems that contrary to Mahanjana’s expectation that the Development Trust would have an option to
purchase the farm ‐ the title of the document foreshadows such an option and paragraph 6 also makes
reference thereto ‐ such a provision was ultimately not provided for in the lease agreement.
15
37.Gerald Tessendorf, an estate agent, confirmed his relationship and
association with the plaintiff for purposes of selling farming property. He
knew of the defendant’s mandate to the plaintiff because he was present in
her office at the time she first made an appointment with him to view
Weltreveden.
38.He accompanied her to the farm when the defendant showed them around,
discussed the purchase price he wanted and conveyed the urgency of the
situation given that Standard Bank was intending to repossess his farm. He
also learned of the defendant’s matrimonial problems, this information
having been volunteered to them by Mrs Burger.
39.He and the plaintiff called Mahanjana in Pretoria when they were back in
East London. They knew that the defendant’s farm was just what he was
looking for. Arrangements were made for him to view it and both of them
accompanied him back to the farm to show him the property. On the last
occasion only the defendant’s spouse was present.
40.Mahanjana expressed an interest in the property. He informed them that he
would discuss the matter with the department and revert to the defendant in
this regard.
41.He was not present when the Anne Chamber’s agreement was negotiated,
but was aware of the offer and its transmission by facsimile to De Waal-
Baxter attorneys. Thereafter he was “involved” in the unfolding of the deal.
16
He knew of every fax that was sent and the plaintiff notified him of all
correspondence received.
42.He personally kept contact with the defendant after to keep him in the loop
because the latter was “in dire straits”. He was aware that the defendant
often phoned the plaintiff as well to find out what was happening. On
occasions the defendant also came into the office and at one stage was in a
particularly bad state emotionally.
43.He personally made a call to Molokoane to track the progress of the
transaction. Similarly he spoke to Boltina. He recalls further that some time
in October 2008 both he and the plaintiff went to Queenstown to introduce
themselves to Molokoane and Boltina. He found Molokoane to be very
accommodating. They informed her of the defendant’s problem, of which
she appeared to be already aware. She undertook to try to help and to speed
things up as much as she could.
44.Conscious of the advance of 30 November 2008, he personally called the
defendant at the beginning of that month to warn him that the offer was due
to expire and that he needed to “renew” it. The latter asked what the
implications were and he mentioned that there was a land dispute which was
why the matter was dragging (He had heard about this dispute from Boltina).
The very specific instruction from the defendant in this regard was that in no
way should they stop the sale. They were to simply “carry on” with matters
as they stood. He feared any delays because the bank was standing poised to
repossess the property.
17
45.Adverting to the two schemes available to the department as mechanisms for
facilitating the acquisition of land (his knowledge of these accorded with
Mahanjana, Matta and Molokoane’s understanding of how they operated);
he was firm that they never got involved in the LRAD scheme, only PLAS.
46.He added that he dealt exclusively in farms and that he had successfully sold
seven farms previously. Thirty or forty similar applications for acquisitions
had been turned down by the department because of valuations not being
accepted by the sellers. This was, however, the first land reform sale
involving the plaintiff. His understanding of the process involved in these
matters, in his role as agent - was that the offer to purchase was “just to get
the ball rolling” and to serve as a basis for the valuation. Thereafter
different procedures ensued: committee meetings were held and business
plans drawn up etc. Finally the department drafted the ultimate deed of sale
in which the government was reflected as purchaser.
47.He identified the deed of sale (Annexure “A”) as being in accordance with
what he understood to be the “standard” in respect of the processes
involved.
48.He described his contact with the defendant concerning the transaction both
before and after 30 November 2008 as being regular and - because of the
delays and pressure the defendant was being placed under by the bank - very
frustrating.
18
49.With regard the “to whom it may concern” letter17, he acknowledged that he
was aware of contact between the plaintiff and Dawn of Kemp Estates
because of their interest in the conveyancing transaction concerning the
defendant’s spouse. This would account for the annotation in the plaintiff’s
hand of Dawn’s name on it.
50.Exhibits “C” and “D”, were to the best of his knowledge sourced from the
original “to whom it may concern” letter which was faxed to the plaintiff’s
facsimile address. He could not decipher from the fax header, when this was,
but thought that it could have been in December 2008 - making it
contemporaneous with the time of Molokoane writing it.
51.Under cross examination he acknowledged that the Anne Chamber’s
agreement appeared on the face of it to be in accordance with the LRAD
strategy, given that NERPO was indicated as purchaser. He added, however,
that it still remained for the matter to be negotiated between Mahanjana and
the department as to what “route” they were going to take. He clarified that
he and the plaintiff did not get involved in “that side of it” and indeed that
they had never before been involved with an LRAD application. Despite
this – or personal knowledge that Mahanjana contemplated buying under
this model, he could not dispute that Mahanjana’s preference had been for
NERPO to own the property in its own name. He added however that the
purchase was envisaged “through the department” and that he expected that
it would be funded under the PLAS system. Seemingly he and the plaintiff
were not interested in how NERPO was going to achieve its objective to
obtain the property. Neither did he consider that it was up to the agents to
17 Exhibit A49 in this instance.
19
determine what system was effectuated. Similarly they were not involved in
the “internal processes” concerning the meetings of the district screening
committee etc. Their only obligation was to follow up with regard to process
made.
52.He agreed with hindsight that the Anne Chamber’s agreement should
perhaps have stipulated the department as purchaser, with NERPO as
beneficiary. However, because it was the plaintiff’s first deal this is
unfortunately how the matter evolved. He further conceded that her
agreement was in law a nullity for want of timeous compliance with the
suspensive condition, but repeated his view that the purpose served thereby –
as with all such offers - was merely to “get the ball rolling” so as to originate
the going out for tender for the valuator and thereafter to generate all the
further processes – environmental impact assessment, business plan and
valuation, culminating in the ultimate sale as reflected in Annexure “A”.
Without it nothing could happen.
53.He disagreed under cross examination that he had only met Molokoane
closer to the date of registration of transfer. He could say so because at the
time of their meeting she had asked if he would in future contact Boltina in
respect of the transaction, who was the project leader. He agreed however
that the meeting was merely fortuitous because they were co-incidentally en
route to Elliot at the time to look at a farm.
54.He conceded that - like the plaintiff - his record keeping was unhelpful as he
made no diary entries of his visits or minutes of his calls.
20
55.As far as he was concerned, he was the person who phoned the defendant to
inform him of the valuation. He explains that he did not wish to go on
hearsay from Boltina and requested something in writing, which
confirmation was provided to him. He conveyed the department’s stance to
the defendant, who undertook to revert to him once he had discussed the
matter, with whom he did not know. He later called and learnt that he had
already accepted the offer. They then left it to the department to negotiate
the deed of sale with the conveyancing attorneys, as is the norm. This final
deed would not have eventuated, however, absent their role in the
introduction and production of the earlier offer.
56.He could not comment on the plaintiff’s evidence being inconsistent with his
– or what the defendant would allegedly say – concerning where or how the
valuation was conveyed to him.18
57.He was unaware that the district screening committee had turned
Mahanjana’s application down the first time because the valuation was too
high; that the application had also failed on LRAD, or that Molokoane had
approached the Lukhanji Red Meat Producers as a possible alternative
beneficiary. There was, however, nothing unusual about this since the
agents did not involve themselves in these processes.
58.Finally the plaintiff called Daliwonga Armstrong Matta who, until April
2009, was in the employ of the provincial land reform office as chief
director.
18 As indicated above, the promise of what the defendant would come and say never materialised as he failed
to testify.
21
59.He similarly testified as to the workings and import of the two land
acquisition programmes, LRAD and PLAS, in place at the time of the
transaction. He added, however, that by the beginning of 2006 the PLAS
model had become the preferable option inter alia because of the limitation
in the amount of the grants under LRAD and the large numbers required to
make up the purchase price.
60.With regard to the Anne Chamber’s agreement and the exchange of
correspondence concerning the valuation and subsequent request by De
Waal-Baxter attorneys to furnish the details of the purchaser of the property
to draft the deed of sale, he saw nothing unusual. He explained that it was
normally the appointed conveyancer who drafted the agreement. He added
that the favourable consideration by the department under the PLAS
programme was the reason why the purchaser ultimately reflected in
Annexure “A” was the national government and that this was a natural
progression.
61.Concerning clause 21 of Annexure “A” dealing with the payment of estate
agent’s commission, he clarified that, where agents were involved, this
clause would be standard.
62.He testified that the complete process flow in respect of land reform
transactions was as follows:
“On receipt of an application or an offer the initial documentation gets submitted at our
regional offices, like Queenstown, Umtata, East London, Port Elizabeth offices. We had four
22
regional offices at the time. Now the initial screening of that application or offer is done at
that level and any packaging or design of that project is done at that level, then the project
officer is appointed who will deal specifically with that particular project, who would do the
packaging and the design, conduct valuations and do all sorts of activities related to that and
that application then gets submitted to a district screening committee meeting, then that
district committee meeting would satisfy itself that the project is in order and that committee
will then recommend to a provincial committee and once it gets to the provincial committee it
is then that at the level of the Chief Director would start in the acting with that particular
project, because the Chief Director would then chair the committee at the provincial level. It
is then on that basis, on the basis of that interaction and scrutiny of the documentation and
related activities that the project either gets approved or not approved and once it is approved
it is then sent back to the district officer where it originated for the district office to take it
further in terms of the conveyancing, the registration of transfer and all related activities,
that’s it in a nutshell.19
63.Because of the department’s preference for the PLAS model he explained
that the tendency in 2008/9 was for them to redesign projects away from
LRAD through PLAS. This was part of the function of field workers in the
registration office to advise on the best route that the progress could take,
looking at the possibility of success and approval. In such event, however, as
far as he was concerned, the project retained its “original identity”.
64.He confirmed that Exhibit “B” reflected the NERPO development trust’s
interest in the project as beneficiary. There was nothing odd about this
evolvement. In his view it always remained the same project.
65.Finally, with regard to earlier correspondence exchanged between De Waal-
Baxter attorneys and the Commission of Restitution of Land Rights
19 At page 246 of the transcribed record.
23
concerning the defendant’s desire to dispose of erf 20120 as well as the
balance of the property, he recorded his view that the Commission is a
separate entity from the department albeit the director-general of the
department had a role to play in the Commission and its proceedings. This
notwithstanding, he could not dispute that the Queenstown office might have
acquired knowledge - in the course of their dealing with the land claim - that
the defendant wished to dispose of Weltevreden as well.
66.Under cross examination he could not agree with Mr Kincaid’s submission
that, because of the distinct concepts of ownership and lease under LRAD
and PLAS respectively - and the progression ultimately in respect of
NERPO’s case toward the PLAS scheme - the department was no longer
dealing with the “same project”. Neither could he agree that once the district
screening committee refused the application under LRAD that that signalled
“the end of the matter”. The single project was “resuscitated” under PLAS
because exactly the same information was on the file, the same beneficiary,
price and seller etc. This did not amount to starting afresh and opening a
new file. Whilst there might have been a change in the “mechanical process
of the acquisition of the farm” – and the need to provide a business plan as a
supplementary requirement under the PLAS scheme - all other things in his
view remained the same. It was always the same project.
67.Neither could he agree that the project had different purposes under each of
the models. This is because the strategic objective of the department is the
promotion of access to land - as opposed to ownership.
20 This erf is adjacent to Weltevreden and was the subject of a land claim which, it transpired from
Molokoane’s evidence, has presently been de‐gazetted.
24
68.Under examination by the court he confirmed that the format of the
application to partake in either programme was not prescribed. It was
possible to initiate the process even by way of a letter asking the department
to assist a beneficiary in acquiring an identified farm. Thus he explained in
his evidence :
“There is no particular format and upon receipt of that letter the Department has got a form
whereupon it captures that information, particulars, property description and things like that,
but the initiation is just about a letter of application or an offer to sell from a seller who simply
brings in an offer to say: “I am selling my farm”, then that initiates the process.”
69.That concluded the case for the plaintiff.
70.The defendant called only a single witness, Molerato Elizabeth Molokoane,
who is employed by the department as its deputy director in the Queenstown
district office.
71.She premised her testimony with an explanation that the Commission for
Land Reform is not an independent body apart from the department, even
though it is a section 8 institution under the Constitution. This is because it is
headed by the director-general of the department. In this vein she refuted
that the department would not have known of the defendant’s intention to
sell Weltreveden before Mahanjana’s introduction to the property by the
plaintiff.
72.She too confirmed the intricate workings of the two land redistribution
models, LRAD and PLAS, which she was called upon in her capacity as
25
deputy director to implement. She is the chair of the district screening
committee, whereas Matta chaired the provincial committee.
73.She acknowledged that she got to know of the Anne Chamber’s agreement
when she took the file over from Boltina in 2008. She explained that he was
junior in her office, slow and unfamiliar with the process. The defendant
had been coming to the office almost on a daily basis “trying to get his
property bought” and wanting to know whether the story had changed from
the day before. He was in a particularly emotional and labile state. He
would sometimes be at her office at quarter to seven already when she
arrived in the morning. Given the annoyance – and the defendant’s
desperation – she herself had taken over the file from Boltina to deal with it.
74.The description in the offer of NERPO as the purchaser led her to conclude
that it was envisaged thereby that the LRAD progamme was to be employed.
She noticed from the project file that the original offer to purchase was for
R9.5 million. Upon its first presentation to the district screening committee
it was declined on the basis that the price was too high and because the price
included movables - which it is not the department’s policy to acquire. But
even absent the movables, the net price of R7.5 million was too high; hence
a decision was taken to appoint an independent valuator to determine market
value.
75.Once the price was determined the offer was made per letter of Boltina
addressed to the defendant dated 5 November 2008. She was away at the
time but requested him to draft something because she anticipated that the
defendant, who was in the know abut the meetings of the district screening
26
committee, would want an update. She understood that the letter was
personally handed to the defendant who took it next door to the offices of De
Waal-Baxter attorneys. Their office got a response accepting it the very
same day, in fact within minutes after the counter-offer was tabled.
76.According to her there was no evidence on the file that the plaintiff or
Tessendorf had anything to do with the acceptance of the reduced offer.
77.Again on 11 November 2008 she was part of the committee that deliberated
on the project. The application before the district screening committee was
in terms of LRAD, but was declined because of the large number of
individual beneficiaries who would be required to make up the purchase
price (66). The committee considered that this would not create a viable
agricultural enterprise and would be inimical to the department’s land reform
objectives. They informed the beneficiary that the application was
unsuccessful and that they were closing their file. Mahanjana, who she also
knew personally, advised her that he would pursue other options, perhaps
even approach a bank for finance.
78.But the defendant would not give up. He continued to make a nuisance of
himself, asking her if she couldn’t get someone else to purchase it. She then
decided to approach Mahanjana again who it seems was also aware of the
defendant’s desperation since the latter had been calling him as well. She
offered that the department could buy it, but only if she had someone who
was prepared to lease it under the PLAS scheme. Mahanjana agreed, albeit
quite reluctantly and after much persuasion by her - because it was really his
27
intention to own the property - that he would explore this route, hence he
submitted a business plan, a necessary requirement under PLAS.
79.When the process ran its course again before the district screening
committee under the PLAS model it went quickly and the application was
successful. However, budgetary constraints prevented the department from
implementing the approval until the next budget term, which was due to
commence on 1 April 2009.
80.The application thereafter served before the provincial screening committee
and was finally approved.
81.She could not agree with Mr. Matta’s assessment of Mahanjana’s two
applications under LRAD and PLAS constituting a single project. She
explained it thus in her testimony:
“They are totally different. As a project officer, as much as you could use your discretion the
beneficiary would have to agree for you to alter it from LRAD to PLAS because the
difference is that in LRAD we give you a grant you do not pay back, it is yours and that’s the
end. With PLAS you take commitment to pay a lease annually and there are clauses in the
lease agreement that says if you do not pay you are then taken out, so it has no security in a
way, that’s the difference of the two programmes.
Yes and once the grant is given and the land is acquired that’s the end of it, the grant doesn’t
come back? Yes.”
82.Regarding the “to whom it may concern letter” of 18 December 2008, she
confirmed that this originated from her. Although the project had been
approved, Standard Bank was still intent upon executing. The defendant had
28
pleaded with her to do something to get them to hold off on the imminent
execution. A call to the bank established that something in writing was
required which resulted in the letter. She personally gave this to the
defendant to take to the manager of Standard Bank in Queenstown.
83.As for plaintiff and Tessendorf, the witness refuted any knowledge of their
involvement in the transaction although she knew of their existence by virtue
of the Anne Chamber’s agreement. She, personally, dealt only with the
defendant and De Waal-Baxter attorneys. If the plaintiff was involved, in
her opinion, there would have been direct dealings with her on all salient
processes including the steering of the application through the district
screening committee. Asked what an estate agent should do to fulfill a
mandate she testified as follows:
“We expect of an estate agent to make sure that the sale goes through. Basically you would
receive an offer as attached here. After assessing or registering it, giving it a project file, you
would then link with the project – with the estate agent to get your title deeds, whatever
documents you need. We also expect them, after we have appointed valuers, where an agent
is actually involved we do not put in terms of reference the seller, we include the agent’s
name. They are expected to take the valuer to the farm to show them whatever is on the farm.
In this case where we needed a business plan we expect them to facilitate the business plan
also. We only come to discuss the matter with the seller when we however cannot agree with
the agent on the price, that’s when we insist on seeing the owner of the farm, that’s the only
time we come to meet them and then also when we send the Deed of Sale.
So you don’t have dealings with the seller? --- No.
You deal at most material times with the agent? --- With the agent, yes.”
84.She conceded however that, notwithstanding her own expectations of what
was required from estate agents in respect of these transactions, these might
29
not necessarily co-incide with what the terms of the mandate were. Her only
knowledge of the plaintiff’s alleged entitlement to commission was when
Tessendorf called to ask when the department was paying. This led to her
sending to him a copy of the letter which she had written to De Waal-Baxter
on 26 January 2009 formalising the offer.21 This would have been on 2
February 2009 as is indicated on a fax report at the head of this letter. Later,
she met him in her office one day as she was on her way out. He said he had
come to introduce himself.
85.Under cross examination she agreed - as Mr. Matta had testified - that the
offer to purchase was sufficient to iniate the application to the department on
behalf of a beneficiary. Further, no new documentation was necessary in
respect of NERPO’s PLAS application save a business plan, which was a
subsidiary requirement. Everything else that was on the file was used
including the Anne Chamber’s agreement. She added that there was a form
used by the Queenstown office which they required from a beneficiary to be
attached, but did not elaborate further in this regard.
86.Under examination by the court, Molokoane conceded that in terms of PLAS
as currently implemented it is not envisaged that there will be even a gradual
acquisition of land by beneficiaries. She explained that in the first year of
PLAS’s implementation, the intention was indeed that the beneficiary would
lease for a period of between 3 and 5 years with an option to buy, but that in
2010 the Minister had issued a directive that no such land would be
transferred. Even old state land currently owed cannot be transferred to any
beneficiary. She agreed that this is not consistent with the department’s
21 Exhibit A15.
30
stated objective to acquire 30% of the arable South African market by 2014,
and might invite a constitutional challenge.
87.Notwithstanding this, she conceded that in terms of the department’s reform
objectives, land is not simply acquired for the sake of it. There would always
have to be a beneficiary in that process.
88.That concluded the case for the defendant.
89.In determining claims for payment of estate agents’ commission, the
question whether an agent is entitled to such payment depends on what was
agreed between the parties and not upon any special rules of law.22 The
proper approach is to look at the contract and to see whether, according to its
terms, construed in accordance with the ordinary principles of construction,
the event has happened on the occurrence of which the commission is
expressed to be payable. In casu neither the mandate nor its terms are in
issue. The plaintiff was simply to find the defendant a purchaser for his
farm. The common cause evidence is that the defendant was by force of
circumstances desperate to dispose of his property, and appeared not to mind
terribly who bought it.
90.In Aida Real Estate Limited v Lipschitz23 Marais J outlined the duty of the
estate agent if he is to earn remuneration by way of commission for selling a
property as follows:
22 Nach Investments (Pty) Ltd v Knight Frank SA (Pty) Ltd [2001] 3 ALL SA 25 (A).
23 1971 (3) SA 871 (WLD).
31
“The law with regard to a matter of this kind is usually stated in the following form: the duty of the
estate agent, if he is to earn remuneration by way of commission for selling property, is to introduce to
his principal (the seller) a purchaser who is willing and financially able to buy the property, and he
earns the commission if the sale is concluded with that purchaser at the stipulated price or a price
ultimately proved to have been acceptable to the seller.”24
91.In this instance the fact of the introduction of Mahanjana to the defendant’s
property is not in issue although its direct connection to the ultimate sale
concluded between the defendant and the government is in contention.
92.In this regard Mr Kincaid, on behalf of the defendant, relied on several
factors in support of the submission that the introduction of Mahanjana was
not the effective cause of the concluding sale, the most obvious of these
being that the Anne Chamber’s agreement is fundamentally different from
Annexure “A” in respect of both price and subject matter. So too her
agreement contains the suspensive condition which made it subject to the
approval by the department and the furnishing of guarantees by 30
November 2009, absent the fulfilment of which it lapsed after this date.
93.Further and in any event, so it was submitted, the department was already
aware of the existence of the defendant’s farm and his desire to sell it -
courtesy of communication between the Commission and De Waal- Baxter
with regard to the earlier land claim concerning erf 201 adjacent to
Weltevreden. It could not be said, therefore, that but for the introduction of
Mahanjana the department would not have acquired it, either through the
24 At 873 H.
32
process of land restitution (in the event of the land claim succeeding), or land
redistribution, as he submitted happened in due course.
94.Mr Kincaid also relied on several intervening factors as distilling or
overwhelming the plaintiff’s introduction of Mahanjana to the property,
namely the failure of NERPO’s application for financial assistance utilising
the LRAD model – which negative decision was accepted by Mahanjana;
Molokoane’s empathy for the defendant and her independent attempts to
persuade Mahanjana to rather submit a business proposal under the PLAS
scheme and its ultimate success on this basis culminating in the sale
agreement (Annexure “A”); and the NERPO development trust taking over
the property per lease (Exhibit “B”).
95.Mr Brooks on behalf of the plaintiff submitted, however, that the plaintiff’s
introduction of Mahanjana - and the commencement of the department’s
internal processes initiated by the submission of the plaintiff’s offer -
culminated in the eventual sale a single line of cause and effect (a seamless
unbroken chain of events) being in evidence throughout.
96.Marais J continued in Aida Real Estate v Lipschitz (supra) - concerning the
dictum referred to in paragraph 90 above - to expound upon the principles to
be applied in determining causality as follows:
“A proviso has been added to the effect that the introduction of the able and willing buyer
must have been the effective cause or causa causans of the sale. If a new factor intervenes,
causing or contributing to the conclusion of the sale, and the new factor is not of the making
of the agent, the final decision depends on the result of a further enquiry – viz, did the new
33
factor outweigh the effect of the introduction by being more than or equally conducive to the
bringing about of the sale, as the introduction was, or was the introduction still overridingly
operative? Only in the latter instance is commission said to have been earned. This enquiry is
not a metaphysical speculation in the result of cause and effect. It requires, as is said in
Webranchek v L. K. Jacobs and Co Ltd., 1948 (4) SA 671 AD, a commonsense approach to the
question of what really caused the sale to be concluded or, to put it differently, as it is said in a
restatement of the law in America, whether it is “just” that the agent should receive credit and
compensation for the work he has done for the seller. In regard to this latter version, it may be
said in passing that this question has nothing to do with the amount of work the agent puts into
it. The mere furnishing to this prospective buyer of the principal’s address or the location of
the property offered may be sufficient to entitle him to claim commission from the seller
provided a line of cause and effect can reasonably be traced from the introduction to the
conclusion of the sale………………Something more than a nude causa sine qua non is
contemplated by this type of contract of agency. The agent’s instrumentality must have been
in all the phases from the introduction to the sale, consistent, uninterrupted and a major
positive force, working towards the successful conclusion of the transaction. The test is an
objective one …”25
97.Before turning to the causality enquiry, I need say a word about the quality
of the plaintiff’s evidence. She struck me as being an unsophisticated
business person who did not understand the niceties of the law. Her simple
understanding of what was required from an agent was to introduce a
purchaser, get a signed offer and follow-up. No more, no less. She had little
appreciation of any distinction between concepts such as ownership and
lease, or the import of suspensive conditions. Neither did she set her mind to
the formal nature of an acquisition under the Land Reform: Provision of
Land and Assistance Act No. 126 of 1993, or the internal processes of the
department by which these ends stood to be achieved. Similarly she did not
appreciate the value in her business of keeping formal notes or records. This
notwithstanding, my contemporaneous reflections of her demeanour when
she testified was that she was neither cavalier nor dishonest.
25 At 873 H – 874 F.
34
98.She readily made concessions where she understood the complex scenarios
put to her, but was otherwise overwhelmed by the cross-examination and
entirely out of her depth. She appeared to be genuinely perplexed and aghast
at the thought that the defendant could disavow liability to pay commission
to her, this premised on her simple understanding that she had introduced her
buyer, had done what was normally expected of an agent, and was therefore
entitled to payment. This was consistent with her response - in relation to the
criticism against her failure to keep proper records - that she could never
anticipate that "we are going to have a court case one day on this", and that
this was the first time something like this had happened to her in her 18
years’ experience as an agent. Once Tessendorf had revealed that this was
her first land reform transaction, her inexperience and nescience of the
department’s internal processes was given context. Coupled with her poor
memory of salient events and an absence of record keeping, the plaintiff was
a particularly unhelpful witness, but her evidence was to a large extent
supplemented by the rest of the evidence which was either common cause or
unchallenged.
99.In considering the various factors having a bearing on causality, I deal firstly
with the suggestion that the introduction of Mahanjana was a neutral factor
in the conclusion of annexure “A” because the Queenstown office was
alleged to be aware of the existence of Weltevreden and of the defendant's
desire to sell it independently of the plaintiff's introduction.
- Molokoane conceded in this regard that the value of Weltevreden
indicated in the correspondence exchanged between the Commission and De
35
Waal-Baxter in 2007 concerning the land claim played no role in the
assessment of the project, whether in respect of Mahanjana's application
under LRAD or in terms of PLAS. She explained that the validity of
valuations extended for a period of six months to a year so that in this
instance the historical valuation obtained for the defendant’s property was
stale by the time the matter first came before the district committee.26
Although she was at pains to suggest that they might have used this as "an
offer", there was no evidence led by the defendant that anything in relation to
the prior process concerning the land claim conduced ultimately to the sale
concluded. The Commission had advised De Waal-Baxter some ten months
before the introduction that they were “excited and accept the offer to sell
farm No. 201 to (it)”27, but nothing seems to have come of this. In the
absence of the defendant having testified, the correspondence exchanged
between those parties in my view has neither significance nor bearing.
- In any event Molokoane conceded that it was in fact the submission of the
Anne Chamber’s agreement which served as the basis to initiate the
department’s internal processes in terms of LRAD, commencing with its
consideration of the LRAD application.
- Further the plaintiff’s introduction of Mahanjana was not denied on the
pleadings, neither was it suggested that the defendant would rely on his prior
dealings with the Commission as dispelling the initiating cause relied upon
by her. On the contrary, the correspondence between De Waal-Baxter and
the Commission in this connection was introduced into evidence only after
26 The valuation was never discovered, neither introduced into evidence.
27 Exhibits E and F refer. The Commission’s letter incidentally does not state pertinently that it was interested
in buying Weltevreden. It is further common cause that despite the passage of time erf 201 still belongs to the
defendant and that the land claim pertaining thereto was recently de‐gazetted.
36
the plaintiff testified, almost as an afterthought.
- Finally, in Molokoane's own assessment of the plaintiff’s efforts as estate
agent she considered that there was no doubt that if NERPO's application
under LRAD had succeeded - at the reduced purchase price of R6 800 00,00
- she would be entitled to her commission. Therefore in my view any debate
about the government purchasing qua the land claim falls away. Although
Mr. Kincaid suggested that I should have no regard to Molokoane’s opinion
in this regard elicited under cross-examination, it is significant that she was
prepared to accept the introduction of Mahanjana as the initiating cause in
one instance, but not in the other.
- Self-evidently the government is a different purchaser than the one
envisaged by the Anne Chamber’s agreement, but that does not mean that
the plaintiff is not entitled to payment of her commission for that reason
alone. Mr. Kincaid correctly conceded as much. See in this regard Joubert
and Others v Costner28 in which a young woman was introduced to certain
property in respect of which she hoped to establish a commune. There were
some complications with regard to the financing, whereupon her father
stepped in to assist and bought the property for her. A submission that the
introduction wasn’t to the actual purchaser was rejected and in the result the
agent was awarded his commission. The court held that the central enquiry
is one of causality. If the original introduction led to the sale, then it does
not matter that there is a difference of party.29
28 1982 (4) SA 540 (C).
29 See also paragraph 111 below in respect of Aida Real Estate (supra). Despite the later purchase by a
company, the husband and wife who controlled the company were identified as one with the company.
37
- In Edwards v Wynberg Club30 there was an exchange of properties and a
number of parties involved in making this happen. The agent introduced a
certain Mr. Engelbrecht to the property, but he did not become the
purchaser, another entity did. There was an intervention by a consortium
ultimately which it was contended made it possible for the respondent to
exchange its property for the property in question. It appeared that the
appellant (agent) did not introduce the consortium to Engelbrecht or to the
club’s property. Furthermore, the appellant was not involved in the
negotiations between the consortium and Engelbrecht which led to the
agreement whereby the consortium purchased the shares in Fitzroy Bay (Pty)
Ltd nor, for that matter, was the appellant involved in the negotiations
between the consortium and the respondent which culminated in the
purchase by the consortium of the club’s property. The prospective
“purchaser” of the club’s property that was introduced to the respondent by
the appellant was the respondent. However neither Engelbrecht nor his
company, Engelmove (Pty) Ltd purchased that property. The actual
“purchaser” was the party introduced to the club’s property by one Janice
Orpen, she being the agent of Engelbrecht and not the sub-agent of the
appellant. Despite the complex exchange, the introduction by the agent to
Engelbrecht to Johnstone was held to be the effective cause of it. This
conclusion was motivated thus by the court:
“Whether in a particular case the agent’s introduction can properly be said to be the effective
cause of the sale must depend on the particular facts and circumstances of the case. In a case
where the eventual purchase is not the person introduced by the agent, but a third party
brought into the picture by the person whom the agent has introduced, the agent’s entitlement
to commission cannot, to my mind, depend solely on whether the relation between the
eventual purchaser and the person introduced is such that the sale can be regarded as virtually
one to the person whom the agent has introduced. That this cannot be the decisive factor is
30 1990 (2) SA 429 (C).
38
evident from the decision of the Appellate Division in Nelson v Hirschhorn (supra). In that
case the agent’s claim for commission was upheld even though the eventual purchase was not
the person whom the agent had introduced, but a party who became involved as a result of the
efforts of that person. There was no suggestion, nor could there have been on the facts of the
case, that the sale to the eventual purchaser could be regarded as being in substance a sale to
the person whom the agent had introduced.
In the present case there is in my view also no room for a finding that the relation between the
consortium and Engelbrecht was such that a ‘sale’ of the Club’s property to the consortium
can be said to be virtually a sale to Engelbrecht. Nevertheless, it was the appellant’s
introduction of Engelbrecht to Johnstone that was the cause of the respondent becoming
interested in the Chelsea Arms property. Those in control of the respondent obviously
regarded the Chelsea Arms property as a desirable substitute for the Club’s property. It was
this factor - the respondent’s desire to acquire the Chelsea Arms property, itself a consequence
of the Appellant’s introduction - that in my view remained operative throughout the
negotiations which resulted in the eventual exchange of the two properties. Furthermore,
although Engelbrecht was not the eventual purchaser of the respondent’s property, it was due
to Engelbrecht that the respondent disposed of its property and acquired in its place the
Chelsea Arms property of which Engelbrecht was previously the effective owner. Although
Engelbrecht decided that he no longer wanted the Club’s property he clearly remained intent
on disposing of the Chelsea Arms property. In order to achieve this he shrewdly exploited the
respondent’s interest in the Chelsea Arms property – an interest which, as I have said was
engendered by the appellant’s introduction – and appointed agents to find someone who was
willing to acquire the respondent’s property by means of the shares in the company owning
the Chelsea Arms property. In my opinion the appellant’s introduction of Engelbrecht to
Johnstone was, as the appellant alleged, the effective cause of the exchange …”31
- In this instance, one cannot overlook the particular context in which
Mahanjana was approached for his interest in the defendant’s property as a
“beneficiary,”32 neither the limited mechanisms in place by the department at
the time by which access to redistributed land could be realised. Regardless
of how the plaintiff understood the matter, Mahanjana confirmed that the
offer was intended to be a land reform transaction and there can be no doubt
that acquisitions pursuant to the Land Reform: Provision of Land Assistance
31 At 439 B.
32 In finding beneficiaries for the department the plaintiff and Tessendorf were focused on presenting only
candidates who might benefit from the department’s land reform objectives
39
Act present a different category of transfers with unique features. Even if
Mahanjana wished for NERPO to acquire the land in its own right – as was
indicated by the offer – it was going to be through the assistance of the
department, and no other financial institution.33 The promise of a sale being
concluded lay in what the department could do by way of its powers.
Although Molokoane suggested that he might approach a private financier,
this was only after the first LRAD application failed. Moreover, there is no
evidence that he in fact did so.
- The ultimate manner in which the defendant’s property was made
accessible to NERPO's development trust is not mere co-incidence albeit
Mahanjana testified that he was unwittingly misled into believing that the
lease held the promise of the trust exercising an option to purchase in due
course. Matta and Molokoane explained that the stated objective of the
department was to acquire 30% of arable land by 2014 per the mechanisms
in place at the time. It is common cause that the LRAD model became
problematic and that these applications were re-designed under PLAS. For
various reasons government has presently resolved to acquire land in its own
name rather than to award grants under the LRAD program. Molokoane
explained how this might attract a constitutional challenge since it defeats
the aim of redistributing farming property to black persons pursuant to
government’s Constitutional mandate, but Matta clarified that the focus is on
access to such land, not necessarily ownership thereof.
- In the scheme of things, therefore, and given the way Mahanjana’s
application mutated, there is in my view no disconnect between Mahanjana
33 This accorded with the plaintiff’s simple understanding that, in presenting the offer, Mahanjana was going
to buy “through” the department.
40
(representing NERPO) as potential purchaser and government as actual
purchaser instituting the trust as lessee when these peculiarities are borne in
mind. The trust’s interest being limited to that of lessee - unfortunately for it
without any option to purchase - does not break the causal chain. It
succeeded in gaining access to the property by the only remaining land
reform mechanism possible at the time.
- To return to the central enquiry, the approach to be adopted by the court
in determining effective cause of sale has been illustrated in a number of
judgments which serve as a useful guide.
- In Aida Real Estate (supra) the property was introduced by the agent to a
husband and wife whereafter the wife advised that they were no longer
interested in purchasing. This was not on account of the fact that she and
her husband had lost interest in the house as such, but because he got the
impression that the agent was not doing his work properly in trying to sell
the house. The husband later negotiated with the seller on his own. A sale
was concluded after the seller’s spouse granted a company controlled by the
husband and his spouse a second bond, thus removing an obstacle in the way
of concluding the purchase. Despite a break in negotiations, and the fact that
the agent had dropped out of the negotiations, the court held that it was the
agent’s introduction and efforts which were the effective cause of the sale
going through.
- In Webranchek v L.K. Jacobs & Co Ltd34 there was an introduction;
some quibbling over price and then a rival firm of estate agents became
34 1948 (4) SA 671 (AD).
41
involved who resolved an issue around price. Only then did the eventual sale
take place. Despite this intervention by the rival agent, the court held that
the first agent was entitled to his commission because it was his introduction
that “aroused” the interest of the purchaser. The sale had clearly been
attributable to the efforts of the first agent that had constituted the “dominant
or effective cause of the sale”.35
- In Nach Investments (Pty) Ltd v Knight Frank South Africa (Pty) Ltd36,
despite the sale of the property to a tenant with a right of pre-emption who
the agent had clearly not introduced - but in circumstances in which an
exclusive mandate was given to sell it - the court found that it was the effect
of an offer presented by the agent from an alternative source that effectively
caused the tenant to exercise his option to purchase.
- A different approach was adopted in the matter of Wynland Properties
CC v Potgieter and Another37. In this instance the purchaser had initially
looked at a property at the introduction of the agent but lost interest in it
because it had certain structural defects. Some time thereafter she had been
persuaded by her sister- in- law to have another look at it and to talk to the
sellers to see if she could find out about these structural defects. She
inspected the property and elicited the assistance of an engineer who gave
her a report that they could be dealt with. She then concluded a sale directly
with the sellers. The court held that it was the subsequent intervention of the
35 At 685.
36 [2001] 3 All SA 295 (SCA).
37 [1999] 3 All SA 576 (C).
42
sister-in-law and the report of the engineer which was the effective cause of
the sale and the agent was held not to have qualified for commission38.
- Also against the plaintiff, but distinguishable, is the matter of Basil Elk
Estates (Pty) Ltd v Curzon39. In this regard a couple looking for
accommodation were attracted to a particular property. They were interested
but the subsequent miscarriage of the wife caused them to walk away from
the deal. The seller herself fell pregnant and elected not to proceed with a
sale. She took the property off the market. Subsequently the erstwhile
potential purchaser had a change of financial circumstances when he won on
the races and was introduced to the same property by a different agent
through whom the sale was concluded. The court held in the circumstances
that the first introduction was not the effective cause, most notably because
there was a change of agent and a lapse of approximately 9 months since the
purchaser initially walked away from the deal.
- In Et Mano Limited v Nationwide Airlines (Pty) Ltd40 the court held that
the direct sale of an aircraft to a purchaser to whom the seller was previously
introduced by an agent - without the latter’s intervention - was necessitated
by unforeseen circumstances and was moreover separated from the agents’
prior failed endeavours to sell by a lapse of several months. Hence it was
held that the agent was not the effective cause of the sale nor entitled to
commission. The court referred to the appropriate test as follows :
38 There is not much in the summary of facts from which to critically analyse the causality finding, but a
significant determination was that the purchasers would have made contact through the intervention of the
sister‐in‐law even if the agent had not introduced the property to the purchasers.
39 1990 (2) SA 1 (TPD).
40 2007 (2) SA 512 SCA at 519 C ‐ D.
43
“The only event that would be regarded as breaking the chain of causation between the agent’s
endeavours and the eventual transaction is a sufficiently weighty intervening cause. What
such an intervening cause might be and when it will be weighty enough, depends on the facts
of each case. In general the question revolves itself into the question whether, on balance, it
was the agent’s exertions that caused the purchaser to buy or whether the sale was rather due
to the impact of the intervening cause.”
- In assessing the agent’s expected involvement and the measure of his
exertions as a “major positive force” in the chain of causation, it is to be
noted that he is under no obligation in the ordinary course to conduct the
actual negotiations or to see to the completion of the ultimate contract.41 He
is remunerated for bringing about a specified event which he is incidentally
under no obligation whatsoever to bring about, rather than for discharging
certain specified duties or obligations.42 He is paid “by results and not by
good intentions or even hard work.43 As was highlighted in Aida Real
Estate (supra), the question whether an agent should receive compensation
for the introduction has nothing to do with the amount of work put into it at
all. This might well evoke some reticence on the part of the seller to pay on
registration of transfer what must seem like an inordinate sum of money for
seemingly little effort put in by the agent, but that is the nature of this type of
contract of agency.44
41 Van Zyl & Seuns (Edms) Bpk v Nel 1975 (3) SA 983 (N).
42 John H Pritchard & Associates (Pty) Ltd v Thorny Park Estates (Pty) Ltd 1967 (2) SA 511 (D) 577
43 Aida Real Estate Limited, (supra), at 875 H.
44 See Doyle v Gibbon 1919 TPD 220 at 223 where the agent handed the prospective purchaser a card to view
the property. The purchaser bought directly from the owner despite leaving the parties to get on with their
own business, but the simple leaving of a card by the agent was held to be the causa causans of the sale. See
also Machonochie’s Executrix v Bidewell‐Edwards (1982) 9 SC 204 in which the court endorsed the principle
that the sale effected through an agency entitled an agent to his commission “however small his trouble in
effecting the sale may have been”. In this instance an advertisement placed in a newspaper published by the
seller and seen by the purchaser was held to be the effective cause of the sale notwithstanding that the agent
had previously introduced the purchaser to the property. But these negotiations were broken off and
communications had ceased entirely.
44
- In this instance much criticism was made of the plaintiff and Tessendorf’s
seemingly limited role in facilitating the process from introduction through
to the successful application in terms of PLAS resulting in the formal
conclusion of Annexure “A”, but the defendant himself never testified to
refute that anything more was expected from the plaintiff concerning the
performance of her mandate beyond what she said was necessary for her to
do in the circumstances. In Barnard Parry Ltd v Strydom45 it was said that
the “state of mind” of the purchaser leading up to the sale – not intending to
be analogous with the defendant’s desperate emotional state in casu – is very
material and his own evidence thereon may be of great importance. There
seems to be no reason why the defendant did not testify, neither was it
suggested that he was unavailable. On the contrary, several references were
made to the promise of what he would come say in his testimony. In this
regard the dictum in Elgin Fireclays Ltd v Webb46 is apposite:
“… it is true that if a party fails to place the evidence of a witness, who is available and able to
elucidate the facts, before the trial court, this failure leads naturally to the inference that he
fears that such evidence will expose facts unfavourable to him. (See Wigmore, secs, 285 and
286). But the inference is only a proper one if the evidence is available and it would elucidate
the facts.”
- Molokoane’s suggestion that the plaintiff had not performed by her
standards of what was expected of an agent involved in land reform
transactions can hardly supplement the defendant’s case in this regard. The
plaintiff, although she had been asked by the department to look for
beneficiaries was not in this instance acting as the department’s agent, but
the defendant’s - and her mandate was simply to find a purchaser for his
45 1946 AD 931.
46 1947 (4) SA 744 at 749.
45
farm. It matters not in my view, therefore, whether the plaintiff or
Tessendorf personally conveyed the valuation to the defendant or whether
one or either of them were involved in the redesign of Mahanjana’s original
application for finance under the PLAS model. Similarly it is insignificant
that the relevant documentation required by the Queenstown office in the
process was procured from the defendant or De Waal- Baxter attorneys. For
the plaintiff it was enough to simply wait for the process culminating in
registration of transfer to unfold. In the absence of any evidence by the
defendant to the contrary, what in fact evolved from date of submission of
her offer to registration of transfer required neither her assistance nor
knowledge.
- I mention, however, that it was not unexpected that the plaintiff’s role
would recede into the background once the defendant began to personally
present himself at the Queenstown office and plead his case. On everyone’s
account Molokoane was sympathetic to his plight and quite taken with him.
Indeed how could she ignore him when he was there from early morning
entreating her to come to his assistance? The evidence also revealed that De-
Waal Baxter’s offices were next door to the Queenstown district office, so it
is not improbable that this facilitated the exchange of documents and
communication between the department and the attorneys, leaving the
plaintiff ostensibly out of the loop.47
47 This explains why, except for the initial letter submitting the offer and contentious letter in which De‐Waal
Baxter refers to a communication addressed by the department to the estate agents, none of the
correspondence in the bundle directly evidences the plaintiff’s involvement. Contrariwise this may be an
indication of the plaintiff’s relaxed business practices.
46
- I turn now to deal with the submission that the Anne Chamber’s
agreement was by 30 November 2008 a “nullity” for want of compliance
with the suspensive condition. The defendant offered no countervailing
evidence to the plaintiff’s in this regard that his specific instruction was not
to revise the offer. Already by the date Mahanjana’s LRAD application
served before the district screening committee for the second time, the offer
did not fairly reflect the events which had by then unfolded in respect of
valuation and counter-offer in respect of price; or that the subject matter of
the purchase had changed. This notwithstanding, it sufficed for the
committee’s purposes. Even later when the PLAS application served before
it, these changes (and the further obvious difference that the government
represented through the department would be the purchaser if the application
was approved under that model), plus the fact that the agreement had by then
lapsed – with reference to the date by when the department was to approve
the financing of the purchase price, did not offer an obstacle to the way
forward. Its legal efficacy, or lack of it, seemed to make not a jot of
difference to the district screening committee. This it is entirely consistent
with the plaintiff and Tessendorf’s evidence that the offer served merely to
get the ball rolling and that a formal deed would be concluded later. It also
fits in comfortably with the evidence of Matta and Molokoane that the
initiating application required no particular formality. Indeed the offer at that
stage, regardless of whether the defendant had “renewed” it, or extended the
period for the financial processes to run their course, could hardly present as
a perfect deed of sale with all the information ultimately contained in
Annexure “A” as the drafting thereof had to await the project instruction
letter. This only followed much later, toward the end of January 2009.
Matta confirmed too that it was standard procedure for the conveyancers to
draft a deed of sale, so nothing turns on this (or the legal reality that the offer
47
had in law lapsed) as constituting a weighty intervening cause breaking the
chain of causation.
- Molokoane’s initiative, driven by her concern and empathy for the
defendant’s situation, in persuading Mahanjana - apparently against his
better judgment - to resubmit under the PLAS model after he had accepted
the declension under LRAD and “walked away from the deal” is indeed a
critical factor in the causal chain. Her efforts in this regard were quite
commendable and saved the day as it were, but it was her duty - as testified
to by Matta - to assist in this manner by encouraging the redesign of projects
under the PLAS model.
- Further, despite giving the impression that her intervention on this basis
was a separate act divorced from anything which had gone before, she was
obliged to concede that her efforts in resuscitating the project were for
nought unless Mahanjana came on board. There had to be a lessee for the
land to be purchased at all, and NERPO was it. She made a fuss of insisting
that, despite the existing project file being placed before the district
screening committee, this was a different and new project, but this cannot be
true if Mahanjana was critical to its success. Had he declined Molokoane’s
invitation at this point to resubmit a business proposal under the PLAS
program, the line of cause and effect would indisputably have grown cold,
but it was his revived interest in acquiring the defendant’s property that
clinched the final sale. The plaintiff’s introduction of him to the property
once again became relevant.
48
- Inasmuch as the passing of time is a critical factor impacting causation, it
is to be noted that the period between the failure of Mahanjana’s application
under LRAD (11 November 2008), and the ultimate success under PLAS (10
December 2008), was of very short duration. It may fairly be concluded that
if the application had succeeded under LRAD, the payment of the plaintiff’s
commission would hardly have been contentious. But it was not. Even if
the resubmission of the application under the PLAS model was underway
without the plaintiff’s knowledge at this time, in her mind she still had until
30 November 2008 for finance to be approved and, even thereafter, she had
the blessing of the defendant to go ahead on the basis of the initial offer
presented. This waiting ended early December 2009 by when Molokoane
had informed the defendant – and the plaintiff claims to have known of this
by virtue of her exchange with Dawn of Dawn Kemp Estates who was also
waiting for this outcome – that the department had approved the sale. The
deed of sale itself was only dated in February 2009, but this was because it
was necessary for project letters to first be obtained before De-Waal Baxter
could be instructed to draft the deed of sale. The further delay in registration
of transfer was attributable to the fact that the department was obliged to
wait in the new financial year in order to have funds to pay the purchase
consideration. These are accordingly neutral factors.
- Following on the approval of the sale, it was never suggested to the
plaintiff that she would not be paid the commission due to her on date of
registration of transfer. The formal deed of sale providing for payment of
commission48 – according to Molokoane included to indemnify the
department in respect of such claims, coincidentally supports such
anticipation on her part. If the defendant and his advisers thought that it
48 Clause 21 of Annexure “A”
49
followed logically that there was no connection between the original
introduction and the eventual sale, or that the interest of the plaintiff had
naturally passed with the failure of Mahanjana’s application under LRAD, it
is improbable that a commission clause would be included in the formal deed
unless the plaintiff had a legitimate expectation to be paid her commission.
It appears rather jarringly therefore that on the morning of registration of
transfer, and seemingly unsolicited - because there is no correspondence
indicating that the plaintiff demanded payment of her commission until after
the defendant’s disavowal of her entitlement thereto - De Waal-Baxter for
the first time suggested that she was not entitled to be paid. The very act of
doing so is consistent in my view with the plaintiff’s submission that her
agency was still very much involved and the defendant knew it - even if this
meant only that she was awaiting registration of transfer in order to be paid
her commission. The reason for the defendant’s disavowal and the timing of
it is instructive. It is based entirely on a legal argument that the offer to
purchase had lapsed some 6 months earlier, in direct contradiction to the
defendant’s specific mandate not to rock the boat as it were by formally
amending the offer or extending the period by when financing for the
transaction had to be approved. If it were true that no expectation on the part
of the plaintiff to be paid abided naturally after this date, it would surely
have been unnecessary to warn the plaintiff that this was the defendant’s
thinking at all. I am accordingly constrained to find that this was nothing
more than an opportunistic attempt on the part of the defendant to avoid his
contractual obligation to the plaintiff when the promise of payment to him -
and the end of a harrowing and stressful process - had at last become a
reality.
50
- In the premises I am satisfied that the plaintiff has established on a
balance of probabilities that her introduction of Mahanjana and activities
predominated as a causative factor in the conclusion of the sale and that she
is entitled to payment of the commission. Since it was conceded by the
defendant that if the plaintiff proved that she performed in terms of the
mandate commission was payable by no later than the date of registration of
transfer, I am further satisfied that interest on the commission should accrue
from this date.
- In the result I make the following order:
- The defendant is to pay commission to the plaintiff in the sum
of 542 640.00 (inclusive of vat), together with interest thereon
at the legal rate calculated from 19 May 2009 to date of
payment;
- The defendant is to pay the plaintiff's costs of the action; and
- Mr. Daliwonga Matta is declared a necessary witness
B C HARTLE
JUDGE OF THE HIGH COURT
51
Date judgment delivered : 9 March 2012
Appearance for the Plaintiff : Adv R Brooks
Attorneys for the Plaintiff : WYLDE & RUCHMANN INC.
2nd Floor, NBS Building
15 Terminus Street
EAST LONDON
REF. MR WYLDE/YM
Appearance for the Defendant : Adv J Kincaid
Attorneys for the Defendant : DE WAAL-BAXTER ATTORNEYS
c/o Bate Chubb & Dickson Inc.
Suite 3, Norvia House
34 Western Avenue
Vincent
EAST LONDON
REF. MR KRETZMANN/KP/
B232/W71