LAW OF PROPERTY – ERROR IN THE DEED OF TRANSFER OF IMMOVABLE PROPERTY CONTRACTS – VOLUNTARY ASSOCIATIONS

LAW OF PROPERTY – ERROR IN THE DEED OF TRANSFER OF IMMOVABLE PROPERTY

CONTRACTS – VOLUNTARY ASSOCIATIONS

 

On 16 May 2000, the Royal Red Flag Association, as a voluntary association entered into a written Deed of Sale agreement with the Municipality of Windhoek for the purchase of the ‘commando’ erf in Katutura. The municipality gave instructions to its legal practitioners to pass a transfer to the Royal Red Flag Association in May 2006 upon payment of the full purchase price. A power of attorney to pass transfer dated 18 May 2007 indicating that the municipality sold the property on 16 May 2000 to the Royal Red Flag Association was prepared to grant the municipality’s legal practitioners the power to register the transfer of the property to the Royal Red Flag Association.

 

In the power of attorney, the word ‘Royal’ in Royal Red Flag Association was deleted and this deletion was endorsed by signatures accompanying the deletion. As a result, the power of attorney indicated that the sale of 16 May 2000 was between the Herero Red Flag Association (the first respondent) and the municipality and that the transfer of the property had to be made to the Herero Red Flag Association. The transfer was thus made to the first respondent.

The Herero Royal Red Flag Association took issue with the transfer and instituted an action in the High Court against the respondents as defendants to rectify what was alleged to be an error made in the deed of transfer of the immovable property. The first respondent raised two special pleas, locus standi, and non-joinder of the appellant’s unincorporated predecessor. The first respondent further pleaded that due to the non-compliance with section 97(1) of the Deeds Registries Act 47 of 1937 (the Act), the appellant’s claim should be dismissed. The court a quo rejected and dismissed the first respondent’s submission that the appellant’s claim should be dismissed for non-compliance with s 97(1) of the Act and upheld with costs the point that the appellant lacked the necessary locus standi to bring the claim.

On Appeal, FRANK AJA (with SHIVUTE CJ and MAINGA JA concurring) considered the High Court’s findings. The appeal succeeded with costs with the Supreme Court holding that:

1. A voluntary association is founded on the basis of mutual agreement and hence when considering its constitution, one is dealing with a contract between the members of the association which must be dealt with in accordance with the principles relating to the interpretation of contracts.
2. On the evidence, the constitution of the Royal Red Flag Association was partly written and partly unwritten. When considering the powers of the association and in such a scenario, the unwritten part of the constitution cannot be ignored in favour of the written part.
3. The raison d’etre for the creation of the Royal Red Flag Association was for it to acquire the property in question from the municipality. This evidence was uncontested.
4. In terms of the unwritten provision of the Royal Red Flag Association’s constitution, it is clear that the Royal Red Flag Association was a universitas and it was empowered to enter into the agreement to purchase the property from the municipality on 16 May 2000.
5. The Royal Red Flag Association made out a case for locus standi, in that it was a party to the contract for the purchase of the property from the municipality and that property should have been transferred and registered in its name.

Herero Royal Red Flag Association v Herero Red Flag Association NASC (18 July 2022)