n Annual Survey of South African Law - The general principles of the law of contract

Abstract

By virtue of section 15(2)(b) of the Matrimonial Property Act 88 of 1984, a spouse to a marriage in community of property cannot validly agree to mortgage immovable property forming part of the joint estate without the written consent of the other spouse. In Gounder v Top Spec Investments (Pty) Ltd 2008 (5) SA 151 (SCA), the husband of the appellant had purported to do just this. When negotiating a monetary loan from the respondent he had, without his wife's consent, agreed to the registration of a mortgage bond over their fixed property as security for repayment of the loan. No bond had actually been registered, but the appellant maintained that the failure to obtain consent to the mortgage agreement invalidated the entire transaction, including the loan agreement (which the respondent was seeking to enforce). The court held that the loan and mortgage agreements were separate and distinct and, accordingly, a declaration of invalidity in respect of one would not invalidate the other (para [18]).