Pretoria East Builders CC and Another v Basson

Infogold Investments CC was the registered owner of erf 6733, Woodland Estate, Pretoria. Pretoria East Builders CC, a related close corporation with the same sole member, was the developer tasked with building a house on the erf. Acting for Pretoria East Builders, its project manager accepted a written offer from the respondent, Basson, to purchase the property. After Basson had signed the offer, an additional clause (paragraph 18) was inserted making the sale subject to a specification list and the signing of a building contract. Basson never accepted this addition in writing. He nevertheless proceeded on the assumption that a binding sale existed, sold his own home, arranged financing, and prepared to take occupation. Shortly before occupation, the appellants repudiated the agreement, asserting that Pretoria East Builders was not the owner and that Infogold had never authorised the sale. Basson obtained urgent relief in the High Court enforcing the agreement and interdicting alienation to third parties. The appellants appealed.

The appeal was upheld with costs. The order of the court a quo was set aside and replaced with an order dismissing the application with costs.

The case is important for clarifying that a sale of res aliena does not bind the true owner absent proof of authority or agency, and that the doctrine of undisclosed principal cannot be invoked without clear evidence of agency. It also affirms the strict requirements of section 2(1) of the Alienation of Land Act and confirms that specific performance will not be granted where performance is impossible, particularly in property transactions.