UJ battle over lease on land it wants for student res heads to ConCourt

23 October 2020 - 12:05 By Ernest Mabuza
The Constitutional Court in session. File image.
The Constitutional Court in session. File image.
Image: JAMES OATWAY

The University of Johannesburg's bid to evict the Auckland Park Theological Seminary (ATS) and Wamjay Holdings Investments from land it leased to the seminary 24 years ago will be heard by the Constitutional Court next month.

The leased land is situated at 51 Richmond Avenue, a seven-minute walk from UJ's Kingsway Campus. The university sees the property as a critical resource and intends to use it for much-needed student accommodation.

UJ's predecessor,  the Rand Afrikaans University (RAU), had leased the land to the seminary in 1996 for a term of 30 years.

The reason for the lease was to allow ATS - which had an agreement with the university to offer higher education degrees at both institutions -  to build its theological college.

ATS paid RAU a one-off rental of R700,000.

A clause in the lease agreement provided that the land would be used by the lessee for education, religious and associated purposes.

Despite this clause, the seminary did not establish a theological college on the property.

Instead ATS ceded its rights under the lease agreement to Wamjay, a private company, by means of a written cession dated March 25, 2011.

Wamjay paid R6.5m to ATS for the right to take possession of the leased land.

The university became aware of the deal between ATS and Wamjay a year later and felt ATS had repudiated the lease agreement by purporting to cede the rights to Wamjay.

UJ then cancelled the lease agreement it had with ATS in 2012 but ATS and Wamjay disputed UJ's right to do this.

This dispute led to UJ going to the high court in Johannesburg where it sought an order that ATS and Wamjay be evicted.

BACKGROUND

On December 6 1996, UJ and the Auckland Theological Seminary (ATS) signed a long lease of the property.

In March 2011 ATS ceded its rights (but not its obligations) in the lease to Wamjay Holding Investments (Pty) Ltd.

Wamjay took occupation of the property in 2012 and submitted detailed architectural plans to the local authority for approval for the construction of a pre-primary, primary and high school with an Islamic ethos.

UJ sought to cancel the lease inter alia on the basis that it was specific to ATS and could not be passed on to a third party. 

In March 2017, the high court in Johannesburg granted an order for the eviction of the seminary and Wamjay.

However ATS and Wamjay appealed to the Supreme Court of Appeal, which upheld their appeal in March this year.

This prompted UJ to appeal the decision before the Constitutional Court.

In its written heads of argument to the Constitutional Court, the university said the SCA held that evidence regarding the context of the lease agreement between UJ and ATS was inadmissible because “the words must be construed objectively”.

Advocates for UJ, Alfred Cockrell, Anthony Mundell, Christo Bothma and Noxolo Khumalo, said this was at odds with another judgment by the SCA where the SCA said a court must examine all the facts - the context - to determine what the parties intended.

“In a judgment handed down – ironically, on the very same day as the judgment in the present case - the SCA interpreted a provision in a lease by having regard to evidence that had been led regarding the background to the conclusion of the lease.”

They said had the SCA chosen to have regard to the evidence of context, it would have reached the conclusion that the rights under the lease agreement were personal to ATS.

They said the co-operation agreement between RAU and ATS was expressly directed at the provision of higher education.

“RAU and ATS were both involved in the provision of higher education, since students at ATS would eventually obtain a university degree in theology.”

The seminary and Wamjay, in their heads of argument, urged the court to dismiss the application for leave to appeal with costs.

They said one of the ways in which a creditor may be prevented from ceding a contractual right is that the contract must contain an “undertaking not to cede”.

“In its pleadings UJ did not rely on an (undertaking not to cede) and nor could it since there is no term on the written agreement that prevents ATS from ceding its rights,” counsel for the seminary and Wamjay, George Kairinos, said in written submissions to the court.

The matter is set to be heard on November 5.

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