The Cape High Court recently granted an application by the Eventide Body Corporate to interdict the developers, the City of Cape Town and others from transferring four parking bays, at R1 million each, to an existing unit owner of the Eventide sectional title development in Clifton and a prospective buyer.

The court held that the bays should be interdicted from being transferred pending an action to be instituted by the body corporate to compel transfer of those bays to the body corporate to be dedicated to visitors, as prescribed by the City’s zoning and planning regulations, which were intended to limit congestion in an already congested part of the city.

Judge Bozalek held that the developer had an obligation to provide eight visitors’ bays in respect of each unit, where there are currently none. The judge interdicted the transfer of four parking bays (not the sectional title unit) and stipulated that if the developer proceeds with the sale of the unit it is obliged to place R4 million of the proceeds in trust as security for the damages claim by the body corporate. The developer will be unable to transfer the remaining four bays, pending the outcome of the action which the body corporate will have to institute within 30 days.

The body corporate, says Rael Gootkin, partner at Webber Wentzel who acted for the entity, had no choice but to interdict the process being pursued by the developer. The developer is a special purpose vehicle whose last remaining assets constituted the sectional title unit and four parking bays being sold. Gootkin says that if the transfer had gone ahead, it would have left the body corporate with no recourse against the developer, with the obligation to comply with statutory requirements still resting on the body corporate.

“Also, at no point in the proceedings was the developer able to explain the allocation of visitors’ bays, which were reduced from eight to three to two in the various plans, and then to nil, which is the current situation,” says Gootkin.

The interdict was granted against the following parties: Robow Investments 47 (Pty) Ltd, City of Cape Town, SP Sterling, ID Myserson, the Pagoda Trust, Registrar of Deeds and the Surveyor General.

Gootkin says the facts are as follows:

After the establishment of the sectional title scheme in 2006, it came to the body corporate’s attention that no visitors’ parking bays were provided for at the development, which comprises 31 units (there were originally 32, but two were consolidated) spread out over nine levels. In terms of the available plans, which were approved by the City of Cape Town in 2006, provision was made for two visitors’ bays.

Investigations by town planners revealed that no visitors’ bays were available at all. The town planners also conducted various searches at the City of Cape Town for the plans. It turned out that the 2006 plans (the “as built” plans) were not the original plans approved in 2004, and these original plans had gone missing at the City. The City approved the 2006 plans based on the assertions made by the architects that these plans did not deviate from the 2004 plans.

However, the town planners consulted various other sources to establish exactly how many visitors’ bays should have been made available at the development. In terms of guidelines set by the province and the City, there should have been one visitor’s bay for every four units. The City’s zoning regulations has the same stipulation. Hence, there should have been eight visitors’ bays at Eventide. The purpose of the regulations was to ensure that visitors’ bays would be available at developments in areas like Clifton, where there is very little public parking. Without on-site visitors’ bays, visitors would have to park on the street, which would create further congestion in an already overcrowded area. Thus the development would have been approved by the City and province on the basis that it would provide visitors’ bays and not further exacerbate the parking problem.

The Eventide Body Corporate decided to bring an urgent interdict against Robow when it was discovered that it was intending to pass transfer of the last remaining sectional title unit and three bays to Myerson and Sterling for R25 million and a further parking bay to the Pagoda Trust. The fear was that once it had disposed of its last remaining assets, Robow, as a special purpose vehicle, would then go into liquidation, and the body corporate would then be unable to obtain any relief from the developer. Nedbank is a shareholder in Robow and has a bond of over R30 million that remains outstanding.

Eventide Body Corporate brought an urgent interdict at the Western Cape High Court on July 8. An interim interdict was granted on July 23 and the matter was argued on September 16, 17 and 21. The aim of the court action was to interdict the transfer of the unit and bays, pending the institution by the applicant of an action that would determine the merits of the matter.

In August, after various further enquiries made to the City of Cape Town, the officials in its planning department finally managed to locate the 2004 plans, which showed that eight visitors’ bays were in fact designated - one for each level for levels two to nine. The City had no explanation for how the number could have diminished to two on the 2006 plans. Because the provision of visitors’ bays is a statutory requirement, the developer would have had to apply for a departure, which entails conducting a public participation process. There was no record of a departure ever being applied for.

In its response, Robow denied that the original 2004 plans were valid and said they had been “superseded” by another set of 2004 plans, which provided for three bays. But those plans had not been stamped by the City, and there was no indication that these had been approved.

In its argument, Robow was unable to explain how the number of bays could have started out from being eight, diminished to three, and then to two and then to nil. It was the applicant’s contention that Robow had “privatised” the bays and generated additional income by selling the visitors’ bays to the existing unit owners at Eventide. These then became exclusive use areas that visitors’ would not be able to use.

When filing its answering papers, Robow did not acknowledge the existence of the original 2004 plans, which its architects must have been aware of. It acknowledged their existence after the applicant procured the plans from the City.

The court also awarded costs to the applicant and held that special circumstances existed to justify Robow paying the applicant the cost of two counsel, being advocates John Dickerson SC and Andre Smalberger.