South African Deeds Journal

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C ontents E ditorial News Discussion on section 35A of the Income Tax Act 25 Cross-Border Insolvency Law 30 Property Law Update Couching of Waiver of Preference in a Sectional Bond 3 Massing and Adiation vis à vis Massing and Election 5 Registrars' Conference Resolutions of 2007 8 The Recognition of Customary Marriages Act, 120 of 1998 9 Beneficiary's Disposal in a Trust and Transfer Duty Implications 17 Sales from Estates: Section 18(3) Act 66 of 1965 19 Chief Masters Directive 3 of 2006: Appointment of Executors and/or Master's Representatives in Deceased Estates by the Master 20 Waiver of Legal Exceptions 25 Change of Names of Building Societies and Banks of Immovable Property in South Africa Does Agricultural Land Still Exist given the Stalwo v Wary case? 27 32 Case Law Books Conveyancing Through the Cases 34 Articles Published in Legal Journals 34 Letters to the Editor Testamentary Conditions and Redistribution Agreements – Reply 1 35 Section 4(1)(b) – A rethink 35 Lapsing of Real Rights of Extension 36 SADJ – October 2006 – Transfer Duty : Acquisition of Immovable 36 Property by a Company, Close Corporation or Trust: Article by PS Franck Other features The Deeds Registry as a Necessary Economic Infrastructure 2 Long Distance Runner 7 Reflecting the Past 40 Years 14 Deeds Training Spreads its Wings 16 DISCLAIMER The views expressed in the articles published in this journal do not bind the Department of Land Affairs and the Chief Registrar of Deeds. The Chief Registrar of Deeds does not necessarily agree with the views of the contributors. HOW TO SUBSCRIBE Anybody who would like to be placed on the mailing list for the SADJ, must submit their postal address to SCMohlake@dla.gov.za PRINTER Lesedi Litho Printers 88 Visagie Street, PRETORIA Editorial Committee Allen West (Editor) - Deeds Training Joanne Dusterhoft - King William's Town Tebogo Monnanyana - Bloemfontein Ali van der Ross - Vryburg Hennie Geldenhuys - Office of the Chief Registrar of Deeds Lood Vosloo (Sub-Editor) - Cape Town Zandré Lombaard (Scribe) - Deeds Training (Scribe) Dorethea Samaai - Directorate: Communication Services Marie Grovè - Deeds Training Elizabeth Govender - Pietermaritzburg Alan Stephen - Johannesburg Levina Smit - Kimberley George Tsotetsi - Office of the Chief Registrar of Deeds Gustav Radloff - Conveyancer, MacRobert Inc. André Schoeman - Office of the Surveyor General, Pretoria The new year has literally commenced with a bang, albeit with or without load shedding. This issue is once again bumper-packed with interesting articles and news. Photos are provided on courses and conferences for readers to try and identify previous Registrars and Deeds Office officials. The 2007 resolutions taken by the Registrars are included. Please note that they have become operative with effect from 2 January 2008. The article chosen as the best article in the previous issue was the one by the former Registrar of Deeds Kimberley, Mr Willie Swanepoel on Fideicommissums. Accolades were received from far and wide for the article on Robben Island together with the superb photography. Thanks once again Loodt on a wellresearched article. Abelated blessed new year to all. ALLEN WEST - EDITOR Contributions may be sent to the Editor: Via e-mail or post ASWest@dla.gov.za AS West Private Bag X659 PRETORIA 0001 This journal is also published on the Department of Land Affairs' website: www.dla.pwv.gov.za CONTRIBUTORS: A S West • A Boraine • L J Vosloo • R Rossouw • A van Wyk • M M Meyer • L Kilbourne • I Broodryk • M Grovè • T Maree COVER PHOTO Allen West - Editor Our Front Cover picture this month shows a colourful row of historic houses on the slopes of Signal Hill in the Cape Town city bowl, which is known as the “Malay Quarter”, so named after the inhabitants who have lived there since they were freed from slavery in the early 1800s. The area is a major tourist attraction, hence the colourful outside paint schemes of some of the houses. It is hardly imaginable that in the 1930s, due to the deterioration of many of these historic buildings, it was considered demolishing the houses to make way for development. A very informative paper, written by Cape Town professor Fabio Todescini and published on the website http://www.international.icomos. org.victoriafalls2003/papers/A2-6%20-%20 Todescini.pdf gives an authoritative insight in the background of the Malay Quarter, or Bo Kaap and its inhabitants, who have shaped this unique heritage site. 1
The Deeds Registry as a Necessary Economic Infrastructure By: Professor Andreas van Wyk University of Stellenbosch Astrike of Deeds Registry officials during 2006 hardly received attention in the highest quarters of Government. The reaction might well have been that it is a strike by just another relatively obscure group of aggrieved civil servants, within the Department of LandAffairs. In reality, the offices of the registrars of deeds, which are mostly situated in areas where there are also Divisions of the High Court, form a vital piece of economic infrastructure. Without it our modern free market system would hardly function or function with great difficulty, as has been shown in countries aligned to the former Soviet Union. Likewise, in many Third World Countries, the lack of a proper land register stifles economic development. As an everlasting asset, land forms the most obvious security one has to offer for the repayment of a loan. However, this presupposes that the particular piece of land may be clearly identifiable. Only then will individual or institutionalized money lenders be prepared to provide credit on the strength of a real right against the debtor's land this which we nowadays call a mortgage bond. This is the basis upon which the whole modern banking system is built. If all land in a country belongs to the State, then banks are largely restricted to providing loans to the different organs of State or merely providing short term loans, even if individual property rights on land are acknowledged without a credible system which proves X or Y's legal right. So for example, in Indonesia, or in other parts of the developing world no bank will provide significant credit to say a Javanese subsistence farmer. It is exactly in this area where South Africa inherited one of its most significant strategic advantages from the Roman Dutch law. Fundamental to a credible cadastre (property register) is the survey performed by many generations of surveyors, which enables almost each piece of land to be identified. This provides not only the creation of a register of who owns a piece of land or has rights thereto, but may also provide this information for public knowledge. This all may sound obvious, but it is not really so? In some of the most highly developed Western countries, such as Britain there is not really an equivalent to South Africa's reliable deeds registers (property registers). During the late Roman times the transfer of land took place by physically handing over a document in which the transferor (i.e. the seller of a house) confirmed that he transfers the land to the transferee (the buyer). This event was not accompanied by public notification. This in essence is still the situation in England today with their “conveyance by deed” and complicated matters to outsiders who wish to know who the owner of a specific piece of land is. However, in other parts of North Western Europe things developed differently during the Middle ages. The transfer of land had to take place in public, usually in the presence of family or neighbours. This developed into a practice where this function was performed in the presence of the local judicial official who had to keep a copy of the transfer deed in his office. This finally gave rise to legislation enacted between 1529 and 1580 by the then Austrian-Spanish rulers who also ruled the Lower Lands of Holland. Accordingly, all transfers of land and rights thereto (such as a mortgage or servitude) had to be registered in the local court. This is precisely what happened in the Cape. Simultaneously with the establishment of a separate Council of Justice (“Raad van Justisie”) in 1680, all land transfers were registered there th until the early 19 century when the British administration in the Cape established a separate registration office for land titles. The Roman-Dutch principles upon which this office then functioned remained, and indeed still does so to this day. South African Deeds Registries are therefore government offices where information relating to land and certain other related judicial information (such as antenuptial contracts) are readily provided for public access. Information kept there enable potential land purchasers or credit providers to decide whether they wish to proceed with such transactions or not. Land registers may function in one or the other way. In certain Western European countries a so-called positive registration system is employed, which means that information recorded may be fully relied upon. By implication this means that the relevant State will guarantee the accuracy of the information contained in its land registers. In South Africa, and elsewhere, the system however is negative. This means that the information contained in deeds registers create a strong presumption, but total reliability cannot be guaranteed. Nevertheless, great care is taken to ensure the accuracy of our registers. In its present form, the Deeds Registries Act, 47 of 1937 places a great deal of responsibility on conveyancers (the specialized attorneys who deal with land transfers and the rights thereto) to take responsibility for this. On the other hand, our system also relies to a great extent on 2
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