A reader wants to know if it is possible that a plot of land he wants to buy cannot be sold to him without the consent of the previous owner.
He is interested in purchasing a plot and approached the owner to negotiate a contract for the sale.
It appears the owner is willing to sell the land but that a sale may not be possible as the person he acquired the land from is required to provide consent should he wish to sell.
See the reader’s question here.
The reader asks whether or not the willing buyer, willing seller scenario should apply.
In principle, it is entirely possible that such a prohibition could be in place.
Such an undertaking typically falls under the so-called pactum de non cedendo [agreement not to cede or transfer].
The key case upon which the law in this regard is largely based is the 1920 Appellate Division case of Paiges v Van Ryn Gold Mines Estates.
In this matter the court considered whether the pactum de non cedendo was possibly invalid based on a restriction to the principle of one’s freedom to contract as one wishes or whether it was invalid due to it being contrary to public policy.
The court held that the general rule is that the undertaking is valid as long as the stipulation serves a useful purpose to the debtor [the person who agreed to the restriction].
In substantiating its opinion, the court said the stipulation against cession is part and parcel of the agreement creating the right, and the right is limited by the stipulation.
It is thus clear that the court regarded the contract and the prohibitive undertaking as being inextricably linked and accordingly inseparable.
While the matter of Paiges v Van Ryn Gold Mines Estates dealt with the prohibition on a worker who wanted to cede his wages as security for debt, the 1944 Appellate Division case of Friedlander v De Aar Municipality dealt with a prohibition on the sale of land.
In this matter, the Friedlanders sold certain portions of their land to the local municipality, which the municipality was meant to hold in trust for use by the local members of the Friedlander township [as commonage].
The agreement of sale specifically provided that the municipality was prohibited from selling the land or any portion thereof without the prior written consent of the sellers or their heirs, executors or assigns.
The court ruled that the prohibition on alienation was indeed valid as the Friedlanders had an interest in upholding the prohibition.
From these cases, it is clear that a possible restriction may prevent the owner of the land from selling the property in question to the reader.
It is possible that a prohibition or some other pre-emptive right in favour of a third party exists over the land in question.
The reader should endeavour to establish the true nature of the prohibition and, in particular, the source of the prohibition.
If he does this, the terms of the prohibition may be properly examined in order to determine what exactly is required of the owner so that he may sell the property successfully to our reader.
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