The court overturned the sale of a house on auction to “the highest bidder” after a divorced wife went behind her husband’s back and bought the home, valued at more than R1.5 million, through her attorney for a meagre R1 000.
According to a divorce settlement, the house was to be sold to the highest bidder, and the parties agreed that they would split the proceeds. However, the husband was unaware that the house was sold from under his nose to the “highest bidder” - the attorney, who had a mandate from the wife to buy it on her behalf.
Thus, if the proceeds were to be split, the husband was due to receive R500 for the home valued at more than R1.5 million.
When the husband got wind of this, he turned to the North West High Court, sitting in Mafikeng, where he asked that the sale be overturned and barring the property from being transferred.
When they got divorced, they agreed to sell the home and split the proceeds. The husband obtained a municipal valuation of the property, which was valued at R1.545 million, and he tried to find buyers.
He told his wife that he had secured buyers, but she said that she was not interested in selling the property.
A few months down the line, a writ was served on the husband informing him the house was due to be sold at auction. But he never physically received it at the time as no one lived there. About four months later, he found the document on the front lawn. It emerged that the Sheriff attached it to the gate, which was locked.
On the day of the auction, the husband went to the house as he thought the auction would take place there, only to find it deserted. He then went to the office of the Sheriff to enquire about where the auction was to take place.
To his surprise and horror, he was told that the auction was held at the Sheriff's office and that the property was sold from under his nose for R1 000, to the highest bidder of the two who attended the auction.
It then emerged that the property was sold to the attorney of record of the wife, acting in terms of a power of attorney on behalf of the wife.
This application was opposed, mainly on the basis that the sale in execution of the property was properly and lawfully done, as the highest bidder’s offer (R1 000) was accepted.
The contention by the wife, through her attorney, is that the sale in execution of the property was advertised in the local newspaper, Mahikeng Mail, and it categorically states, although in the fine print, that the sale would be held at the Sheriff's office, with the address provided. According to the wife, all the requirements were complied with.
She also said that the notice of sale was placed on the notice board in the foyer of the High Court, Mahikeng. Thus, she said, she did everything that was required of her.
Judge Ronald Hendricks said in terms of the agreement, both parties would split the proceeds of the sale to the highest bidder and the intention was that neither of them should unduly benefit, to the exclusion of the other.
While the property was indeed sold to “the highest bidder,” there is, however, a history to this matter. The wife earlier, through her attorney, asked the husband whether he would purchase her half-share in the property, but no response was received.
She became aware that her husband received an offer from someone to buy the property for R900 000. Based on this, she made a proposal that he should “buy her out” at an amount of R700 000. The husband once again did not respond.
She then told him that the property would be auctioned. Judge Hendricks noted that it is not in dispute that in terms of the settlement agreement, either party may cause the property to be auctioned if the husband could not ‘buy out’ the wife (at 50% of the market value).
The judge said that the formalities of the sale in execution were complied with, is not the issue. What is in issue is the fairness and equity of the process.
On her own version, the wife offered that the husband “buy her out” and give her R700 000.
“If this is the amount that she regarded as the fair value of a half-share of the immovable property, then the question that begs an answer is why would it be fair, just and equitable that she, through the assistance of her attorney, buy the property for only R1 000” the judge questioned.
He said it is indisputable that the wife’s attorney knew that she wanted R700 000, which is a far cry from the R1 000 received for the property worth more than R1.5 million.
“This is certainly not just nor fair at all,” the judge said.
In overturning the sale, he remarked: “This is clearly not a case that is to be determined by the ‘fall of the hammer’ of the Sheriff as auctioneer.”
Pretoria News