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Home purchased 20 years ago for R100 returned to owner

Tebogo Thupaatlase, acting judge of the Johannesburg High Court, undid a series of “illegal” sales of a property that began 20 years ago when Nedbank (then BoE) purchased a home for R100.00.

According to GroundUp, He ruled that the original execution sale of the property by the then BOE Bank (now Nedbank) in 2001 had been conducted without judicial oversight or authority and returned it to its original owners.

R100 was paid for the property, which was added to the bank’s real estate portfolio. It was then resold. In 2014, the property was finally sold to its current owner, Tobeka Mahamba, after being transferred to three distinct entities.

During this time, the original owners Agnes Malinga and Joseph Njoko continued to live in their home, believing they were still the owners.

They claim that it wasn’t until Mahamba filed for their eviction in the Sebokeng magistrate’s court that they learned their home had been sold more than two decades earlier.

Judge Thupaatlase

Acting Judge Thupaatlase stated in the application before him that he was required to determine the legality of the transactions over the years.

The judge stated, “The case has a tangled and convoluted history.”

He stated that there was no dispute that Malinga and Njoko were the original owners who obtained financing through the defunct NBS Bank in 1990. In 2005, the majority of the bank’s assets and liabilities were transferred to Nedbank, following a series of mergers.

According to Malinga and Njoko, they did not know where to pay their installments during this time, causing them to fall into arrears.

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Nedbank argued, on behalf of BOE Bank, that this led to the foreclosure and sale in execution in 2001.

The judge stated that despite the bank’s claim that the couple subsequently paid rent, entitling them to remain in the property, “there is no indication that they were aware of this situation and there is no other evidence of a rental agreement.”

The applicants submitted receipts indicating payments they believed to be bond repayments made around 2003.

They stated in 2014 that they “suspected something was amiss” when they were visited by “unscrupulous and illegal estate agents.”

During this time, the house was being advertised by a firm named CUF Properties (which had bought it from Company Unique Finance which had bought it from Meadowstar Investments which had bought it from the bank).

Mahamba bought it from CUF.

“The details of this case reveal a very troubling pattern of behavior among the numerous banking institutions that arose following the demise of NBS. It is unclear how existing clients were informed of the various changes in ownership.”

The fact also that property was sold for R100, according to him, exemplifies the type of “mischief” that judicial supervision is intended to prevent.

The ruling

“There is no evidence that any legal proceedings were initiated when the home mortgage agreement was canceled around 2001,” he said.

This, he explained, meant that the bank’s foreclosure and sale were illegal. And as a result, successive transactions were also tainted.

He declared the bank’s forfeiture of the property illegal and invalid, as well as the successive sales and transfers, null and void.

He ordered the Registrar of Deeds to revoke all transfers and register the property in the applicants’ names within sixty days.

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