Noormohamed v Visser NO and Another

Immovable property was sold in execution by public auction. The appellant, Noormohamed, made the highest bid and the property was knocked down to him. Prior to bidding, he informed the sheriff’s deputy that he wished to bid and thereafter nominate another purchaser, which was accepted. After the auction, Noormohamed nominated S Moosa as purchaser. The Conditions of Sale were completed reflecting Moosa as purchaser and signed by Moosa, not by Noormohamed. Moosa paid a deposit by cheque which was later dishonoured. The sheriffs instituted proceedings seeking to compel Noormohamed to sign the Conditions of Sale on the basis that he acted as a nominee, thereby rendering him liable as surety under clause 16 of the Conditions of Sale. The High Court upheld this contention, and Noormohamed appealed.

The appeal was upheld with costs. The order of the High Court was set aside and replaced with an order dismissing the application against the appellant. The applicants were ordered to pay the appellant’s costs.

The case clarifies the legal meaning of ‘nominee’ in the context of sales in execution and Conditions of Sale, and confirms that a purchaser who merely assigns rights and delegates obligations is not a nominee or trustee attracting suretyship liability. It affirms principles relating to public auctions, cession and delegation, and limits the scope of automatic suretyship clauses.