LEASE AGREEMENTS
Determining the Lawfulness of Occupation
To resolve this, the court had to consider three key arguments raised by Evolv:
Key Findings and Legal Principles
LEASE AGREEMENTS
Determining the Lawfulness of Occupation
At the heart of the dispute was the question of whether Evolv’ s occupation of the property remained lawful, even though its lease agreement had been entered into with a party that never legally owned the premises or had authority to bind the lawful owners.
To resolve this, the court had to consider three key arguments raised by Evolv:
1. That the lease was entered into in good faith at a time when Med Office was reflected as the registered owner and was therefore valid and enforceable.
2. That the lease remained binding under the huur gaat voor koop principle, which protects existing leases following a change in ownership; and
3. That, even if the original lease was invalid, the liquidators had either ratified it or entered into a new agreement by their conduct after taking control of the property.
Key Findings and Legal Principles
1. Registration and Ownership
The court confirmed that South Africa operates under a negative deeds registration system, which records transactions relating to immovable property.
While this system generally reflects the legal position accurately, the information contained may not always guarantee the true legal position. A title deed for example, may be incorrect or defective and not reflect the correct legal position in respect of an immovable property.
As such, parties must exercise caution and ensure that the person reflected as owner in the registry has acquired title through a lawful and enforceable process.
83