PROPERTY LAW – REVIEW OF ORDERS DECLARING PROPERTY NOT BELONGING TO DEBTOR EXECUTABLE

PROPERTY LAW – REVIEW OF ORDERS DECLARING PROPERTY NOT BELONGING TO DEBTOR EXECUTABLE

1^st respondent obtained a default judgment in the High Court against the 1^st applicant for payment of an amount owed. 1^st applicant failed to pay the judgment in full, and 1^st respondent sought to have his property declared executable, but the parties reached a settlement. 1^st appellant again failed to comply and 1^st respondent sought and obtained an order to declare his property executable, on 7 June 2019.

When the Deputy Sheriff went to attach the property, it came to light that the property was registered to the 2^nd appellant (1^st appellant’s mother). Prior to the transfer of the property in her name, she entered into an agreement with the 1^st appellant that he could use the property as ‘collateral for a FNB business loan and the bond shall be cancelled immediately after this purpose’. The property was transferred to 1^st appellant on this understanding.

Subsequent to the compromise, the appellant donated the property to her mother, and it was transferred accordingly. The first respondent then filed an application in the High Court to cancel the donation and directing the Registrar of Deeds to transfer the property to appellat, and to ratify the previous order of 7 June 2019 to declare the property executable. The High Court granted these orders on 6 June 2019. The 1^st applicant applied to the Supreme Court to review the orders of 7 June 2019 and 6 December 2019.

In respect of the 7 June 2019 order, whether the granting resulted from an irregularity in the proceedings in view of the fact that no judgment had been granted based on the compromise; that 2^nd applicant who was the registered owner of the property was not cited as a party to the proceedings and hence did not participate in the proceedings. In respect of the 6 December 2019, whether the order amounted to a mistake of law per se which resulted in an irregularity in the proceedings so that it can be said that the applicants did not receive a fair trial, and it was held:

5. Clause 5.7 of the compromise made it clear that the compromise constituted a novation of any claims that might have existed prior to the compromise.
6. The doctrine of res litigiosa on which 1^st respondent relied did not find application on the facts of the matter.
7. There was no basis to declare the property of the 2^nd applicant executable in respect of debts owing to the 1^st respondent by the 1^st
8. The legal conclusion reached by the court a quo setting aside the transfer of the property by 1^st applicant to 2^nd applicant was not correct.
9. 2^nd applicant acquired a real right in the property which the 1^st respondent had no right to assail. Real rights generally prevail against personal rights (even if it is prior in time).
10. The court could not interfere with the court a quo’ decision as that was a matter of appeal.

Mbumbo v Amadhila (SCR 2 – 2022) NASC 23 August 2022