Louis Case Reports

GARDEN SERVITUDE

PROPERTY – Servitude – Utilitas – Exclusive use of garden in sub-divided property – Element of utilitas being present – Features of garden servitude meeting distinctive characteristics of praedial servitude and not personal servitude of usus – Common intention of the parties and when terms of servitude interpreted purposively, contextually and having regard to the background to their preparation and production.

Berzack v Huntrex 277 (Pty) Ltd [2022] ZASCA 17 at [22]-[33]

Facts: Ms Berzack subdivided her property into two separate portions and to keep the garden as part of her property without contravening the land use regulations she reserved her rights to the garden, which had fallen into the subdivided portion, by means of a servitude. She had cordoned off that area with a wooden fence. Huntrex later acquired this property and the terms of the servitude were endorsed on the title deed.          

Appeal: By Ms Berzack against the decision of the High Court in terms of which the servitude was declared to be a personal servitude of usus. The order entitled Huntrex to demolish the wooden pole fence that exists on the servitude area and to construct its own fence, fitted with a gate.

Discussion: Whether the terms of the pertinent clause amount to a praedial or personal servitude of usus and whether such servitude is capable of being registered in terms of section 66 of the Deeds Registries Act 47 of 1937; that the interpretation of the clause was crucial; that the High Court applied a narrow and sequestered method of interpretation, misconstrued the meaning of utilitas and mischaracterised the praedial servitude as a personal servitude of usus; and that an opportunity was missed to unravel the causa et origo of the contract that was concluded between Ms Berzack and the first buyer.

Findings: The meaning of the clause shows that the element of utilitas is present. The features of the garden servitude meet the distinctive characteristics of a praedial servitude, not a personal servitude. The attack against the recognition of a garden servitude simply on the basis that it is not one of the traditional servitudes does not have a legal basis. The correct position in our law is that there is no exhaustive list of real servitudes. The order authorising Huntrex to demolish the existing wooden pole fence and erect its fence on the servitudal area, thereby restricting access by Ms Berzack to the garden, ought not to have been granted. The registration of the servitude by the Registrar of Deeds cannot be faulted.

Order: The appeal is upheld and the order of the High Court replaced with one dismissing the application.

NHLANGULELA AJA (PETSE AP and MOLEMELA JA concurring.)

PLASKET JA and GOOSEN AJA dissenting from para [34]

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STATE-OWNED COMPANY AND ARBITRATION

Arbitration – Arbitration clause – Purported illegality – Tender by state-owned enterprise – Contended that decision of a third party could result in the imposition of financial liability and divesting board of determining how much should be paid – Clause was clear and enterprise had explicitly agreed to the arbitration proceedings and the specific dispute to be arbitrated – Application seeking setting aside of award dismissed.

Komatiland Forest v John Wright Veneers [2023] 56241-2021 (GP)at [21]-[34]

Facts: Komati is a subsidiary of the South African Forestry Company and both fall within the definition of a state-owned company. John Wright Veneers (JWV) operates a sawmill and was awarded a tender by Komati for the processing of logs in 2017. The tender was for three years and during 2019 JWV gave notice to Komati that it wished to negotiate for a revision and increase of the processing fees for the logs. Komati refused to acquiesce, a dispute was declared, and an application was brought to court for the Legal Practice Council to nominate an arbitrator as provided for in Schedule 9.

Application: Komati seeks the setting aside of the arbitration award made by against it in favour of the JWV.

Discussion: The contention by Komati’s that the inclusion of the arbitration clause as schedule 9 to the tender was unlawful and that within the context of a tender awarded by a state-owned enterprise, submission to the decision of a third party which may result in the imposition of financial liability in effect divests the board of Komati from the determination of exactly how much and for what a successful tenderer should be paid; and that the crux of Komati’s case was that because the inclusion of Schedule 9 was itself an illegality, the arbitration and everything that followed was similarly so.

Findings: Schedule 9 of the contract was clear and Komati had explicitly agreed to the arbitration proceedings and the specific dispute to be arbitrated. Despite the ruling against it and the withdrawal of its participation, Komati did not exercise any of its rights in terms of the Arbitration Act 42 of 1965. Komati also did not exercise the rights available to it in terms of the contract to summarily terminate the Contract if JWV did not meet its production obligation or if Komati was not prepared to agree to an increase. In these circumstances JWV was entitled to accept that the arbitration would be the process through which the dispute was to be resolved. There was no merit in the assertions by Komati that the decision of the arbitrator falls to be set aside in terms of section 33 of the Arbitration Act or that the inclusion of Schedule 9 in the contract was invalid on the basis of legality.

Order: The application is dismissed.

MILLAR J

The argument for Komati is that “cost effectiveness” extends beyond the procurement process to the ultimate commercial outcome of the contract. Such extension must on this argument be applied retrospectively and only in favour of the SOE. (See para [22].)

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NOTICE TO ORGANS OF STATE AND ESKOM 

CIVIL PROCEDURE – Organs of state – Notice – Whether notice required for Eskom as an organ of State – Not a functionary or institution exercising a power or performing a function in terms of the Constitution – Not an organ to which Act applies – Plaintiffs not required to have given notice – Institution of Legal Proceedings Against Certain Organs of State Act 40 of 2002, s 3(1).

Botha v Eskom Holdings [2023] ZAFSHC 45 at [11]-[25]

Facts: The plaintiffs in these cases instituted action against Eskom for damages they suffered on their farms in fires allegedly caused by the negligence of Eskom in Heilbron during 2018 and in Lindley during 2020.

Special plea: Eskom raised a special plea based on the fact that the plaintiffs had failed to give it the required notice in terms of section 3(1) of the Institution of Legal Proceedings Against Certain Organs of State Act 40 of 2002.

Discussion: That Eskom is an organ of State; the contention by the plaintiffs that Eskom is not one of those organs to which the Act applies; the case of Madinda v Minister of Safety and Security at the Supreme Court of Appeal; the preamble to the Act and the section 1 definition of “organ of State”; and that the only definition that could be applied to Eskom was that of a “functionary or institution exercising a power or performing a function in terms of the Constitution”; and the submissions that Eskom does not exercise a power or perform a function in terms of the Constitution, but rather in terms of other legislation.

Findings: There is no indication that Eskom is controlled by any national or provincial department and that it is therefore an extension of such a department. While Eskom is under a Constitutional obligation to provide electricity for the economic and social wellbeing of people, it does not perform its functions in terms of the Constitution, because the Constitution does not refer to Eskom and it does not provide for its existence. This is done in terms of other legislation. The court is not persuaded that Eskom qualifies under the definition of an organ of State in section 1(1) of the Act. It was not necessary for the plaintiffs in the present matter to give the required notice in terms of section 3 of the Act.

Order: The special pleas are dismissed.

LOUBSER J

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ABOUT THE EDITOR

Louis Podbielski spent ten years at Juta working on various law reports and has read many thousands of judgments for case selection. He has considerable experience in writing flynotes and headnotes, compiling case annotations, and in refining subject indexes.​ During his four years at LexisNexis he was involved with legal data, analytics and in developing various legal tech solutions. He now runs his own case law service Louis Case Law

You can read his full CV and more about Louis on his LinkedIn profile where he shares interesting and recent cases.

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