The two appellants (G and J) appealed against a decision of the Northern Cape (Kimberley) High Court (Lever AJ) in which the court held that a condition in a will that gave G the right to purchase a particular farm at a set price from the deceased estate of the original testator’s spouse was an option (pactum de contrahendo).
The original testator (A) executed a will in 1990 in which A bequeathed two farms to his surviving spouse (AG) subject to the conditions that if she chose to sell the farms during her lifetime G would have the right to buy the farms at a price prescribed in the will, and if she did not G would have the right to buy the farms upon her death from her executor at the fixed price. J is A and AG’s daughter and G is J’s spouse and therefore A and AG’s son-in-law.
AG sold one farm during her lifetime to G at the prescribed price, but retained the other farm until her death. After AG’s death, G wanted to enforce his right to purchase the second farm. However, J’s siblings applied to the Kimberley High Court to have the conditions in the will set aside on the grounds that it amounted to the giving of an option to purchase and was therefore subject to the requirements of section 2(1) of the Alienation of Land Act, 68 of 1981. The provision requires that such an option must be in writing and signed by both the parties to such an option, and as G was clearly not a party to the will and did not sign any option his perceived rights were unenforceable. The Kimberley High Court ruled in their favour.
The Supreme Court of Appeals (Ponnan JA, with Cachalia, Zondi, Dambuza and Nicholls JJA concurring) held that the source of G’s right was not an option (pactum de contrahendo), but originated from a testamentary provision with proper alternative provisions should G decide not to purchase. Therefore G had a personal right to purchase, first against AG should she choose to sell during her lifetime and then against her executor after her death. The appeal was accordingly upheld and the order of the Kimberley High Court reversed.