IN THE HIGH COURT OF SOUTH AFRICA

In the matter between:

And

BOULEVARD MOTORS

JUDGMENT

OOSTHUIZEN. AJ:

[1] in the instant application it is not in dispute that applicant is the registered owner of certain property being erf 1586 Goodwood, that respondent is in possession of the property and that at such property respondent operates a motor vehicle service and petrol station.

[2] Applicant acquired the property from Polsta (Pty) Ltd (hereinafter referred to as "Polsta"). In 1987, Polsta concluded a lease with BP Southern Africa (Pty) Ltd (hereinafter referred to as "BP") and respondent in turn sub-leased the property from BP. Erf 1586 Goodwood is hereinafter   referred   to   as   "the   leased   property".

[3] On acquiring the leased property from Polsta, applicant, by operation of law, stepped into the shoes of Polsta as lessor in respect of the lease with BP. Applicant contends that the main lease with BP expired on 31 August 2007. This contention is borne out by the lease which is annexed to the founding affidavit and which is alleged to be that main lease. Clause 2 thereof reads as follows:
"This agreement of lease commences on 1 September 2002 and shall endure until 31 August 2007".

[5] In the instant application the applicant seeks an eviction order on the basis that the main lease has come to an end on 31 August 2007 by virtue of the clause already referred to and that the rights of the respondent as sublease lessee have accordingly also lapsed in view of the authorities to which I refer above.

[6] The respondent advances various grounds of opposition. As to urgency, the respondent contends that no case is made out for dealing with the matter on an urgent basis and submits that that being so, the application falls to be dismissed.

[8] The application now before me was launched on 18 December 2007. It was postponed on four subsequent occasions. Three months have lapsed since the launching of the application. It appears to me that the respondent has had adequate opportunity of setting out the grounds on which he opposes the relief sought against him and of resisting the application and canvassing all matters relative thereto. There is nothing indicating that the Eaunch of the proceedings on an urgent basis constitutes an abuse of process by the applicant. The applicant states that he wishes to make use of the lease premises to operate a petrol station, workshops and as a venue for the sale of motor vehicles. This intention is not disputed.

[9] The respondent contends that the operation of this type of business requires certain licences issued by the regulatory authorities, and that the issue thereof may take several months. The details , put up by the respondent are unclear as to how long that process or those processes may take but the facts thus advanced do not, in my view, defeat the applicant's right to the eviction order sought. There is no reason why the applicant should not in the meantime be placed in occupation and permitted to commence with whatever steps are open to him preparatory to launching the business. There is furthermore no tender by the respondent to vacate the premises once the regulatory approval is granted.

[10] An argument was put up on behalf of the respondent that the founding papers contain no details showing that the respondent is a man of straw. The respondent would therefore be able to continue paying the rental due in terms of the sub-lease and also, so it was contended, any holding-over damages that may later be awarded to the applicant. For that reason it was submitted the eviction proceedings cannot be entertained on an urgent basis.

[11] That contention loses sight of the fact that the applicant has stated that it requires possession of the leased property and it requires to utilise the leased property for its own ends. H does not require the property for purposes of re-letting to another person. No authority was cited to me in support of a proposition that a right to eviction is negated simply because the Eessee is in a position to pay damages or compensation in some other form, should it be found that the lessee's continued occupation of the property was unlawful.    That factor does not, in my submission, negate the applicant's right to have the matter dealt with on an urgent basis. I can see no reason why, in the circumstances I have outlined, it is inappropriate to deal with the matter on an urgent basis.

[13] Applicant's averment that he purchased the property subject to this lease is of course not hearsay. Applicant is aware of the terms governing the sale of the property to it and encumbrances resting on the property at the time. There is nothing in the documentation and the material before me indicating that the lease in question is anything but genuine. In addition, the existence of the lease is confirmed by various letters included in the record from BP and their attorneys. Furthermore, the existence of a lease is acknowledged in the sub-letting agreement concluded between BP and respondent during 2002 and no facts were, in my view, put up by respondent indicating that he had any reason to betieve that some lease agreement other than that annexed to the founding affidavit as Annexure ES2 is in existence or was concluded between the applicant's predecessor and BP.

[14] Lastly on this issue, even if the evidence regarding the conclusion of the lease does amount to hearsay, as submitted by respondent, the Court is vested with a discretion to receive such evidence by virtue of section 3 of Act 45 of 1988. The manner in which that discretion is to be exercised depends on the nature of the proceedings, of the evidence proffered, of the purpose which the evidence would serve, of the reliability thereof and of prejudice to the other party if the evidence is allowed.

[15] To the extent that the document in question (Annexure ES2 to the founding affidavit) does involve and is introduced by allegations which amounted to hearsay, I am of the view that this is a proper case for such evidence to be received in terms of section 3 of Act 45 of 1998.

"The tacit relocation is an implied agreement to re-let and is concluded by the lessor permitting the lessee to remain in occupation after the termination of the lease and accepting rent from the lessee for the use and enjoyment of the property. In general our courts have not followed the Roman-Dutch writers but have made the duration of a tacit lease dependent upon the rent period. Thus the effect of a tacit relocation of premises originally let for one year at a monthly rent (it has been held) is to renew the lease from month to month and each time only for one month. On this reasoning upon the expiration of the period, the lessee should be entitled to vacate the premises and the lessor to claim his eviction but the courts hold that the tacit relocation can be terminated unilaterally only upon reasonable notice being given, the reason presumably being that in the absence of an indication to the contrary, the parties have tacitly agreed that the relocation will be for an indefinite period".

[20] In the instant matter, notice has been given to the respondent to vacate the premises at the end of August 2007. Such notice was given firstly in a letter from BP to respondent dated 28 May 2007 notifying him that his occupancy of the leased premises woufd expire at the end of August 2007 and secondly, in a later letter from BP dated 14 June 2007 which contains the unequivocal statement that the lease would terminate on 31 August 2007. Respondent does not deny the receipt of these letters and was accordingly, some two and a half months prior to the expiry of the lease, notified of the fact that his right of occupation would terminate on 31 August 2007.

[21] A tenant or sub-tenant who ignores a valid notice of termination of this nature and, contrary to the terms of such notice, remains in occupation of leased property, cannot contend that a tacit relocation has occurred. Even if, however, there was scope for finding that a tacit relocation had taken place, the respondent was given more than sufficient notice of the termination thereof and has failed to put up any facts showing that the period of the notice or notices that he was given was unreasonable.

[22] The respondent next contended, relying on clause 18 of the lease (Annexure ES 2 to the founding affidavit), that a right of first refusal was enjoyed by the respondent in respect of certain transactions and that he had not been given an opportunity of exercising that right of first refusal. Clause 18 reads as follows:

[23] Firstly, and upon a plain reading of the clause which I have just quoted, it applies only during the subsistence of the lease or any renewal thereof. It does not, as was contended for by the respondent, survive the lapsing of the lease. The lease in the instant case, as already pointed out, terminated on 30 August 2007, there has been no renewal thereof and the clause is therefore inapplicable.

[25] Reliance was then placed on a contention that contractually the doctrine of legitimate expectation came into play and that by reason of such doctrine, the respondent had a legitimate expectation that he would be entitled to remain in occupation of the premises for a further three years or, alternatively, that a further sublease for a three year period would be concluded with him.

[29] In the instant case and in relation to the legitimate expectation which the respondent says he has, he refers to the fact that at a stage prior to the launch of the instant application the applicant indicated an interest in buying the respondent's business. The applicant also allegedly at some or other stage indicated that it was not interested in continuing the relationship with BP, and indicated that it had had a fall-out with BP.

[30] Even if one accepts these allegations as true, I cannot by any stretch of imagination see that they would give rise to the expectation alleged, namely that the respondent would be entitled to remain in occupation of the property for a further three years and the reliance on the doctrine of legitimate expectation is, in my view, misplaced.

[33] fn the premises, I am of the view that none of the grounds raised by the respondent in resisting the relief sought constitute a legally valid reason for refusing the eviction that the applicant seeks in these proceedings. The applicant is accordingly entitled to succeed. As regards the costs of the application, I am of the view that the costs on the ordinary scale are appropriate and that there is no basis for ordering any costs on a punitive scale.