Property Law Update

Issue 35 - 2011

09 December 2011

DEVELOPER’S EXTENSION RIGHT NOT INCLUSIVE OF RIGHT TO LEASE

Body Corporate of Savannah Park v Brainwave Projects 1147 CC and Others (735/10) [2011] ZASCA 239 (1 December 2011)

In this matter the Supreme Court of Appeal investigated what the content was of a developer’s right to extend a scheme. This was prompted by the factual scenario in which a developer, who allowed a cellphone operator to erect a mast on the land in return for rental before opening the sectional title scheme, continued to receive rental for it after the scheme was opened. The developer had reserved a right to extend over the relevant portion, but the body corporate argued that the right to extend did not allow the developer to commercially exploit the area. The Court upheld the body corporate’s argument.

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The Judgment
Summary of the Judgment

TYPICAL BOND CLAUSE WORDING UNDER SCRUTINY

Park 2000 Development (Pty) Ltd v Page (905/2010) [2011] ZASCA 208 (29 November 2011)

The Court here was faced with wording of a bond clause typically found in agreements for the sale of immovable property. Did the phrase “should such a bond not be granted within 7 days of signature of this agreement, the seller will have the right, but will not be obliged, to cancel the sale…” allow a purchaser who did not get the bond approval within the required time, to argue that the agreement remained valid because the seller did not cancel the agreement after the lapsing of the 7 day period? The Court upheld the general principles of interpretation and confirmed that commercial reality required that such agreement lapse after expiry of the time period in the absence of any waiver of the provisions by the purchaser.

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The Judgment
Summary of the Judgment

PRESCRIPTION STARTS RUNNING FROM WHEN YOU FIND OUT - NOT FROM WHEN YOU UNDERSTAND

Claasen v Bester (872/10) [2011] ZASCA 197 (23 November 2011)

Does prescription run from the date when you find out a relevant fact or from the date on which you understand the implications of this fact? The Supreme Court here confirmed that it commences from the former date. The dire consequence of this was that a farmer lost his farm after learning too late that the details of his right to re-purchase were insufficiently recorded in the agreement in which he sold his farm to a friend.

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The Judgment
Summary of the Judgment