Tramore Property Group (Pty) Ltd v Vosloorus Square CC

In 1991 the City Council of Vosloorus and Permprop (Pty) Ltd concluded an exchange agreement in terms of which certain properties owned by Permprop (later Tramore Property Group (Pty) Ltd) would be transferred to the council, and certain council-owned properties would be transferred to Permprop, with transfers to occur simultaneously. No transfers were ever effected, although the council took occupation and built a school. In 2000 Tramore sold the council properties (which it did not yet own but was entitled to receive under the exchange agreement) to Vosloorus Square CC. Vosloorus Square undertook steps to have the land rezoned and proclaimed as a township, incurring substantial costs and concluding a services agreement with the municipality (successor to the council), albeit formally in Tramore’s name. Tramore later refused to transfer the properties to Vosloorus Square and purported to cancel the sale agreement in 2014, alleging that Vosloorus Square failed to provide guarantees required under the sale agreement. Vosloorus Square applied to court for specific performance, seeking transfer of the properties. The High Court initially dismissed the application for lack of locus standi, but the Full Court upheld the appeal and ordered transfer. Tramore appealed to the Supreme Court of Appeal.

The appeal was dismissed with costs, and the order of the Full Court directing the parties to take steps to effect the simultaneous transfers and related relief was upheld.

The case clarifies South African law on the enforceability of a sale of property belonging to another, the circumstances under which a seller may cancel for alleged breach, and the distinction between the cession of rights and the delegation of obligations. It affirms that a purchaser may enforce ceded contractual rights, including rights to compel transfer, even where the purchaser was not a party to the original agreement, provided the seller has disposed of those rights.