EXAMINATION PREP

CHAPTER 1
In a nutshell – The law of property deals with rights in property, as well as unlawful
control of property. It excludes property rights traditionally dealt with in specialised
courses, but it includes property rights in constitutional law. The main sources of the
law of property are common law, legislation, case law and customary law, all of them
as interpreted and applied with due regard to the spirit and objectives of the
Constitution of 1996.
The law of property deals with the rights and actions of persons with regard to things
and other forms of property, as well as other relations between persons and property.
It describes the ways in which property rights can be acquired and exercised lawfully
and the remedies by which they are protected against infringement, as well as the legal
results and implications of other relations between persons and property.
Scope of the law of property
Law of Property
Traditionally Private Law Traditionally not
private law
Traditional law of things Aspects of constitutional law
References to the law of obligations
References to commercial law
References to immaterial property law

Terminologies
Person – is a legal subject who can acquire and exercise rights and duties in law.
A legal subject can either be a natural person (individual) or a juristic person
(collective operating as a single entity)
An Object – is anything with regard to which a person can acquire and hold rights
and duties to.
Property – everything which can form part of a person’s estate, including corporeal
& incorporeal things.
A Right – legally recognised and valid claim by a subject to a certain object. Not all
relations between person and an object are recognised and protected by law.
Property right is any legally recognised claim to or interest in property

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A thing is a specific category of property, which is defined with reference to its
characteristics; a corporeal object outside of the human body and an independent
entity capable of being subjected to legal sovereignty by a legal subject from whom it
has use and value.
A claim or action is lawful when it is protected by existing legal principles and it is
deemed unlawful when it contravenes, is in conflict with or not acknowledged by the
law.
A remedy is a legal procedure provided by the legal system to protect a right against
infringement or to control the effects of an unlawful act or situation.

CHAPTER 2
Relationship between Property and Things
1. CHARACTERISTICS OF THINGS
1.1 Corporeality – Tangible i.e. a horse; bike; house (it occupies a certain
space and can be observed with any one of senses.
1.2 External to humans - Human beings are not legal objects, but parts of
them can be classified as negotiable items like hair for wigs. However, this
is subject to the Human Tissue Act 65 of 1983, which restricts the use of
human reproductive cells and organs for artificial reproduction and
transplantation.
1.3 Independence – The thing must be a definite and distinct entity that exists
separately.
1.4 Subject to juridical control – Corporeal entities, such as celestial bodies
and natural aspects like the sea and air, cannot be classified as things due to
their lack of juridical control.
1.5 Useful and valuable to humans - A thing must be useful and valuable to a
legal subject, satisfying their needs, and must be destined to exist, despite
not necessarily having economic or sentimental value.

2. CLASSIFICATION OF THINGS
2.1 Negotiable
- Res alicuis – things owned by a natural or legal person or things in a
deceased or insolvent estate.
- Res nullius – Wild animals, birds, fish, insects etc. things which are
wild in nature and have never been owned by any person but ownership
of these things may be acquired through appropriation.
- Res derelictae (Aminus domini) – Things no longer in the physical
control of the owner and in respect of which the owner no longer has the
intention to be the owner. Can also be acquired through appropriation.
- Res deperditae (Aminus domini) – Things lost and no longer in the
physical control of the owner but in respect of which the owner has not
lost the intention to be the owner. Such things cannot be acquired
through appropriation

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 2.2 Non-Negotiable
- Res communes omnium – Natural resources, such as air and running
water, are available to all people but have statutory limitations under the
National Water Act 36 of 1998 and the National Environmental
Management: Air Quality Act 39 of 2004.
- Res publicae - State-owned assets, like public roads, national parks, and
beaches, are used for public benefit but are usually negotiable, as not all
state property falls outside legal commerce.
2.3 Singular and Composite things
Singular things are independent units without specific components, like bricks or
tennis balls. Composite things, on the other hand, are compositions of different
components in a new unit, like motor bikes or houses. These components lose their
individuality, making them considered one thing in property law.
Principle thing - A principal thing is an independent entity with real rights, not part
of another thing. In Khan v Minister of Law and Order 1991 (T), it was determined
that the component of a composite thing providing its identity is the principal thing,
and the owner of the composite thing includes its accessory and auxiliary elements.
Accessory thing - A composite thing, which can exist independently but has been
merged with or mixed with the principal thing to the point of loss of independence,
can be classified as accessory things, as per Khan v Minister of Law and Order 1991
(T).
Auxiliary thing - An auxiliary thing is a separate, independent entity that, due to its
economic value, destination, or use, is no longer considered an independent thing in
property law, regardless of its physical connection to the principal thing.
Fruits - are produced by the principal thing without being consumed or destroyed.
They were previously accessory things to the principal thing, but are destined to exist
separately and independently after separation. i.e. fruit, young of animals , young trees
etc.
2.4 Movable and Immovable things
- Immovable things are units of land and everything permanently attached
to them by means of attachment (assessio).
- Movable things are all things that cannot be classified as immoveable.
(a) Transfer of ownership of moveable things take place by means of
delivery of the thing to the receiver while the transfer of ownership
of immovable things take place by means of registration or transfer
(with the intention of transferring ownership in the deeds registry)
(b) A contract to alienate immovable things must meet the formalities
prescribed in terms of the Alienation of Land Act 68 of 1981 and in
certain cases the requirements are set out in the Property time
sharing Control Act 75 of 1983 as well as the Sectional Tiles Act 95
of 1986, while credit agreements in respect of movable property

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 must meet the formalities described by the National Credit Act 34 of
2005, no other formalities are required for them.
(c) Real security in the case of immovable things is provided by means
of registration of mortgages while security is provided by pledge or
the registration of a notarial bond in the case of movables.
(d) In cases where a debtors assets are sold in execution, his movables
must first be attached then his immovable
Immovable things and Movable things can both be classified as
corporeal or incorporeal
Immovable corporeal – land, building)
Immovable incorporeal – Servitudes, Registered lease in respect of land
Movable corporeal – all tangible things which are not immovable i.e.
car, horse, book
Immovable incorporeal – Shares in a company, goodwill of a business.
2.5 Fungible and Non-fungible things
Fungible things are similar items that can be replaced, while non-fungible
things have individual characteristics or value that make them irreplaceable.
Examples include light bulbs or wire rolls, while original paintings or hand-
woven table cloths can become non-fungible due to additional reasons. The
fungibility of a thing can be determined through a contract, which can
impact its consequences. If a thing is irreplaceable, it cannot be replaced by
a similar one if destroyed before transfer. Compensation may be claimed in
such cases. Non-fungible things due to a legatee cannot be replaced by a
similar one, and if destroyed, the legacy lapses. Money is classified as a
fungible thing.
2.6 Consumable and non-consumable things
Consumable things are depleted or consumed by normal use, like food,
wine, or fuel, while non-consumable things are maintained even with
normal wear and tear. This distinction is crucial when parties to an
agreement regarding a loan or lease of consumables intended to replace
the item with a similar one upon termination. A usufruct can only be
given regarding non-consumable things, while a quasi-usufruct can be
given for consumables, requiring the holder to return the same amount
and quality as consumed. Money is considered a consumable thing, and
a quasi-usufruct can be given for money.
2.7 Divisible and Indivisible things
A thing is divisible if it can be divided into smaller parts without
altering its original value, such as a piece of land or a sack of mealies.
However, it cannot be divided without changing its nature or function,
as seen in a painting or a chair.

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CHAPTER 3 – SUBSTRACTION OF DOMINION
3.1 Property Rights
The law of property encompasses all assets in a person's estate, including rights in
corporeal and immaterial property, as well as rights derived from obligations like
contract or delict. Ownership is the only right in a corporeal or incorporeal thing
belonging to oneself, while a limited real right is in a thing belonging to another
person. A creditor's or personal right against a person involves requiring them to do
something, refrain from doing something, pay someone money, or give something.
The obligation to give something may apply to both corporeal and immaterial things,
but it is always a consequence of one's right against a person.
3.2 Real rights in corporeal property
Ownership and limited real rights in corporeal property
The law of property is concerned with real rights to corporeal things and other
property rights not related to corporeal things. It includes a number of property
relations, not regarded as rights. Real rights and creditor’s rights with regard to
corporeal things are classified as rights in property. They are, however, acquired,
exercised and protected in different ways.
All real rights in corporeal property are classified as follows:
• Ownership (the only real right in terms of one’s own property).
• Limited real right (entailing limited rights to the use and enjoyment of property
belonging to someone else).
3.4.2 The distinction between real rights and creditor’s rights causes problems:
(a) The problem is largely restricted to corporeal property
The problem primarily affects corporeal property, not incorporeal property. Limited
real rights, like long-term leases and mineral rights, are registered as immovable
incorporeal property, following the same principles as land. However, with some
exceptions, it doesn't affect incorporeal property rights.
(b) The problem is restricted to limited real rights
The distinction between real rights and creditor's rights doesn't affect ownership of
corporeals, as ownership is always a real right. However, determining whether certain
rights in corporeal things are limited real rights or creditor's rights is challenging due
to South African law's lack of restriction on limited real rights categories. Creditor's
rights in corporeal things are also created by contract or in a will, making it difficult to
determine whether these rights are limited real rights or creditor's rights.
(c) The problem is largely restricted to immovable property
The acquisition of real rights in immovable property is more complex than for
movables, as they are typically acquired upon registration in the deeds registry. The
Deeds Registries Act 47 of 1937 governs the registration of deeds pertaining to rights

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in immovable property in South Africa. Section 63(1) of the Act allows only real
rights in immovable property to be registered. This raises questions for lawyers and
courts regarding whether a particular condition in a deed can be registered. If it
amounts to a real right, the condition can be registered, affecting the transfer or
acquisition of a real right. However, if the right is a creditor's right, it may not be
registered. The question of whether the right is real or personal does not depend on
registration, as the question is whether the right can be registered.
(d) The problem is limited to rights created in a will or contract
Case law analysis reveals that most problems arise when determining whether rights
created in a will or contract of sale of immovable property are limited real rights
(registration required) or creditor's rights (unregistered). The challenge lies in
determining whether certain rights created in contracts are limited real rights
(registration required) or creditor's rights (unregistered).
3.4.3 Theoretical Approaches
Classical theory - Distinguishes between real and creditor's rights. A real right is a
person's right in a thing, while a creditor's right is a person's right against another
person. The object of a real right is the thing itself, while a creditor's right is the action
the debtor must perform. This theory was approved by the supreme court of appeal in
National Stadium South Africa (Pty) Ltd v FirstRand Bank Ltd 2011 (SCA).
Personalist Theory - The personalist theory focuses on the enforcement of real rights
and creditor's rights. Real rights are absolute and can be enforced against anyone,
while creditor's rights are relative and can only be enforced against specific
individuals or groups. Creditor's rights are based on an obligation of one person to
perform a specific action for the benefit of the holder of the right. This obligation
usually stems from a contract between the parties, and the performance of the
obligation is enforced on the authority of the contract.
On the other hand, real rights are not based on a contract but on a direct relationship
between the holder and the property. Real rights allow the holder to use the property
and exclude others from interfering with it, making them absolute or enforceable
against the whole world.
3.4.4 Case Law – The Subtraction from the dominium test
The subtraction from the dominium test was devised in case law to facilitate the
distinction between limited real rights and creditor’s rights in immovable corporeal
property.
In terms of this test, one should look at the obligation created by the right. If the
obligation rests upon:
1. The land itself (on every owner of the land), the right is real, and it creates a
subtraction from the ownership.
2. A specific person in his or her personal capacity, the right is a creditor’s right.
Only real rights in land may be registered, and creditor’s rights registered by
mistake or by way of exception, do not become real rights.

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In South African property law, there is a principle that an owner's right to ownership
oF Property may be lost if they allow another person to act as if they were the owner
of the
property. This principle is commonly referred to as the "Subtraction from the
Dominion"
principle and is an exception to the general rule that only the transfer of ownership or
agreement can affect ownership. There is a distinction between real rights and
personal rights in immovable corporeal property
The Subtraction from the Dominion principle is based on the idea that ownership of
property includes the right to exclude others from using or occupying the property. If
an
owner allows another person to use or occupy their property without objection, that
person
may acquire the right to continue using or occupying the property.
Case Law: Ex Parte Geldenhuys 1926 (O), the court held that when examining an
apparent personal right to see whether it qualifies to be registered one needs to look at.
1. Nature and effect the obligation created by the right.
 Obligation creates a burden upon the land – a real right is created and should
be registered and bind successors in title.
 If Obligation creates a burden upon the person a personal right is created and
may not be registered and only the debtor in personal capacity is bound
(2) Consequences of the obligation
(3) Intention of the obligation – what was intention of the parties, did the parties
intend
to bind successors in title or only current owner.
 A personal right can be registered when it is found to be inextricably linked to a
real right
In Lorentz v Melle 1978 (T) The court considered the right in contest in this case to
be one rooted in money, thus amounting to a personal right. As such, the court held it
is not a real or limited real right and cannot be confused with a servitude or the
entitlements of a servitude such as registration.
Pearly Beach Trust v Registrar of Deeds, the court held that it is an entitlement of
the owner of the property to be able to dispose of his property when and how he sees
fit. This case illustrates that this entitlement of the owner is restricted because he is
unable to obtain the full proceeds of the disposal of his property due to the right held
by the creditor. This restriction is made perpetual; thus, his heirs will inherit this
restriction too. As such, the rights of the creditor amount to a registrable right.
Today courts rely primarily on Geldenhuys. The judgement was codified in s 63(1) of
the Deeds Registries Act. Courts look for the following: the obligation created, the
effect of the obligation, and the intention of the parties.

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CHAPTER 4 – Ownership
Ownership in terms of common law - Ownership in South African case law is defined
as the most complete real right a legal subject can have regarding a thing, or the real
right that gives the owner the most complete and absolute entitlements to a thing.
However, ownership can be limited by objective law and the rights of others, such as
limited real rights or creditor's rights. Ownership is indeterminate and abstract, as it is
influenced by the interests of the community and social factors. The content of
ownership is described in terms of the owner's exercise of entitlements regarding the
thing. The communal form of ownership, traditionally applied by most indigenous
peoples in South Africa, forms the basis of the views of a large part of the South
African population on ownership. Customary rights and freedoms recognized by the
Constitution are not denied by the fundamental rights of chapter 2 if they are
consistent with the fundamental rights. Several other rights in property are currently
recognized as constitutional property in terms of section 25 of the Constitution and
Port Elizabeth Municipality v Various Occupiers 2005 (CC).
Aspects relating to the content of ownership
1. Entitlements: This refers to the rights and benefits that are attached to
ownership, such as the right to use and enjoy the property, the right to exclude
others from the property, and the right to sell or dispose of the property as the
owner sees fit.
2. Limitations on Ownership in the Public Interest: This aspect of ownership is
concerned with the limitations that are placed on the rights of ownership in
order to serve the public interest. These limitations may include restrictions on
the use of the property, such as zoning regulations, and the requirement to pay
taxes and other duties.
Definition of Ownership
Ownership is an abstract legal relationship between an owner and an object, granting
them certain entitlements. This relationship is indeterminate and varies over time,
depending on the relationship or relationship. Ownership is limited by statutory
measures and limited real rights, ensuring that others respect the owner's rights
regarding the object.
CHAPTER 5
Co-Ownership
Nature of Co-Ownership
Two or more persons can co-own a thing simultaneously, but this does not mean the
object is divisible or distinguishable. Co-ownership is owned by several persons in
undivided shares, meaning they cannot physically divide the thing without the co-
owner's consent. However, a co-owner can alienate or encumber their undivided co-
ownership share. The entitlements to the thing are not divisible, but they must be
exercised jointly in accordance with the undivided shares. The co-owners must
exercise their rights jointly.

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 1. Establishment of Co-ownership
(a) Inheritance - When a testator leaves an indivisible thing to two or more
persons or leaves a divisible thing to two or more persons provided that it may
not be divided, it is owned by the heirs in co-ownership.
(b) Conclusion of a marriage in community of property implies that the
parties to the marriage are co-owners of all things in the common estate in
equal, undivided shares as long as the marriage exists.
(c) Mixing (commixtio) - When movable things of different owners are mixed,
without the permission of the owners, in such a way that the mixture creates a
new thing, it is owned by the owners in co-ownership The previous owners of
the mixed things become co-owners of the new thing in the relation in which
their property contributed to the new thing (mixture).
(d) Estate holdership - The surviving spouse in a marriage in community of
property continues the community of property together with the heirs of the
deceased spouse.
(e) Voluntary association without legal personality - The members of such
an association are co-owners of the assets of the association in undivided
shares. Such a member may, however, not alienate or encumber his undivided
share because of the unique consequences flowing from his contract of
membership of the association.
(f) Contract - By means of a contract two or more persons can jointly buy a
thing and have the ownership transferred in undivided shares through delivery
or registration.
Bound common ownership
Exists between common owners as a result of an underlying legal relationship
between them, which forms the basis for their common ownership of the thing or
things and which implies that the common owners cannot terminate the common
ownership while the legal relationship is still in existence. i.e. a partnership, a
marriage in community of property etc. A bounded common owner cannot alienate an
undivided co-ownership share or terminate the common ownership as long as the
underlying legal personality still exists.
Free Co-ownership
Means that the only legal relationship which exists between the parties is the co-
ownership of a thing or things, no other (underlying) legal relationship exists between
them. A co-owner’s co-ownership share is alienable. All decisions regarding
alienation must be made jointly by the co-owners and every co-owner has a right to
veto in this regard
Rights and Obligations regarding the property
Van der Walt et al. (2016) argue that co-ownership does not allow for physical
divisibility for alienation or encumbering, but it can be divided for use. Co-owners
must jointly exercise entitlements and legal actions related to the thing, with certain
rights and obligations including alienation, use, profit, income, maintenance,

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expenses, and the right of veto. These rights and obligations are essential for effective
co-ownership.
 Alienation and encumbrance – Co-owners must give permission before a
thing can be alienated or encumbered
 Use - Co-owners must jointly decide on the use of a property, either through a
use agreement or informally. Each co-owner has the right to use the property
reasonably and in accordance with their share size, ensuring it is not used to the
detriment of other co-owners. Unreasonable use occurs when agricultural land
is changed or third parties use the property without co-owners' permission. The
co-owner's use must be proportional to their share in the joint property,
considering the use rights of other co-owners.
 Profit, income & fruit - Co-owners have equal rights to property profits,
income, and profits, even if initiated by one co-owner. However, if co-owners
agree that every co-owner can appropriate the fruit of property use
proportionate to their share, other co-owners share only in profit resulting from
unreasonable or disproportionate use. One co-owner cannot appropriate the full
profit of the property through independent use and exploitation.
 Maintenance and expense - Co-owners are required to contribute to property
maintenance and expenses proportional to their shares, but not for luxurious
improvements without co-owner approval, only for necessary property
conservation expenses.
 Right of veto - The majority's decision on property use is not binding on the
minority, allowing them to veto it. This can lead to termination of co-
ownership or court testing of co-owners' reasonableness, resulting in
declaratory orders or prohibitive interdicts, as in Pretorius v Nefdt and Glas
1908 (T).
Entitlements regarding undivided shares
Co-ownership shares in joint property are idealized, undivided ownership of a thing,
not actual divisions. In free co-ownership, a co-owner can alienate or encumber their
share without the cooperation of other co-owners, even against their will. This is a key
difference between free co-ownership and bound common ownership. The co-owner
can encumber their share with a limited real right to a third party proportionate to their
share.
Remedies
Property control and use are typically governed by mutual agreements between co-
owners. However, if the agreement is not followed or the parties cannot agree on its
content, the court may be consulted for assistance.
Remedies include
1. Damages or profit division - If a co-owner exceeds their reasonable use of a
property by using it for a purpose not previously intended or if the use exceeds their
share, other co-owners can claim damages or a division of profit from the co-owner.
This can be done through an action, considering factors like the co-owner's income,

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expenses, profit made, and the extent of the share. The extent of the other co-owners'
claim depends on the co-owner's share and the income from the use.
2. interdict - A co-owner can use their property unreasonably by obtaining an
interdict, based on their right of veto (ius prohibendi), a common law principle.
However, they cannot prohibit the use of the property by other co-owners for any
reason, as they are entitled to use the property as co-owners.
3. sub-division - If a property is divisible, co-owners can claim subdivision based on
each co-owner's share. They must first attempt to divide the property, but if not, the
court asks for a division through the actio communi dividundo (an action that can be
instituted after the dissolution of the partnership for the court to order the dissolution
of the jointly owned property). A perpetual co-ownership is not enforceable. If an
agreement is made, it cannot be challenged based on size or inequity. If the court is
asked to subdivide, co-owners must submit a proposal. If impossible, the court may
order a division. If uneconomical or detrimental, the court may order a sale or
compensation after property evaluation.

NB! CHAPTER 7 – LIMITATIONS ON OWNERSHIP

Although ownership often provides the owner with comprehensive power regarding a
thing, this power is not of an absolute nature. This means that ownership does not
provide an owner with absolute and unlimited entitlements regarding his property.
There are several limitations on an owner in the exercise of his entitlements of
ownership.
Limitations on ownership
Statutory limitations - Statutory limitations are typically imposed on owners to ensure
they exercise their rights in the community's best interest.
1. Taxation
The government's interference in individual owners' patent rights is commonly
indicated by the levying of taxes.
2. Immovable property in general
The Restitution of Land Rights Act 22 of 1994 is a key control mechanism for
immovable property. Other legislation, such as the Expropriation Act 63 of
1975 and the Spatial Planning and Land Use Management Act 16 of 2013, also
impact landowners' entitlements. Other legislation includes the Land Reform
(Labour Tenants) Act 3 of 1996, the Extension of Security of Tenure Act 62 of
1997, and the Prevention of Illegal Eviction from and Unlawful Occupation.
- The Expropriation Act 63 of 1975
Through expropriation (a) ownership of the land vest in the public
interest in the expropriator; (b) the previous owner’s ownership is
terminated without his consent (c) against payment of compensation.
- The Spatial Planning and Land Use Management Act 16 of 2013
It is a framework for South Africa's spatial planning and land use
management. It aims to address historical development imbalances by

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 improving land access and use, focusing on previously excluded areas,
and addressing poverty and deprivation. The Act also emphasizes the
need for improved spatial sustainability, including maintaining fiscal,
institutional, and administrative capacities at all government levels,
protecting high-potential agricultural land, and implementing
environmental management instruments. It also emphasizes the need for
efficient use of existing resources and infrastructure, considering
negative financial, social, economic, and environmental consequences in
decision-making processes. The Act also emphasizes the importance of
spatial resilience and flexibility in planning, policies, and land use
management systems to ensure sustainable livelihoods for communities
impacted by economic and environmental shocks.
3. Rural land
The Environment Conservation Act 73 of 1989 and the National Environmental
Management Act 107 of 1998 are crucial statutory measures for protecting and
controlling the use of land in rural areas. These acts allow for the declaration of
protected nature areas and special nature reserves for protecting the
environment or specific characteristics of a region. However, these measures
can limit the entitlements of landowners or other real rights holders.

In the case of Corium (Pty) Ltd v Myburgh Park Langebaan (Pty) Ltd 1993
(C), the court ruled that nature parks are a national asset of immense value and
should not be allowed to continue with activities that might make it difficult for
applicants to reverse the development. Landowners and controllers are obliged
to prevent pollution or degradation of the environment, or take reasonable steps
to prevent further degradation or restore the land.

Other Acts pertaining to agricultural land include the Fencing Act 31 of 1963,
the Agricultural Pests Act 36 of 1983, and the Conservation of Agricultural
Resources. These acts aim to protect and control the use of land effectively.

4. Urban land
The National Building Regulations and Building Standards Act 103 of 1977
governs the nature and standard of buildings on urban land. Other statutory
provisions include the National Environmental Management Act, Air Quality
Act 39 of 2004, Health Act 63 of 1977, Environment Conservation Act 73 of
1989, and Housing Act 107 of 1997. In the case of Verstappen v Port Edward
Town Board 1994 (D), a dumping site cannot operate without a permit from the
Minister of Water Affairs, who must promulgate regulations for the permit
application process. The court ruled that the operation of a dumping site
without a permit was wrongful, even though the regulations had not been
established by regulation.
5. Movable property
Movable property owners face statutory limitations, including the National
Road Traffic Act 93 of 1996, which regulates motor vehicle use. Other acts
prohibit certain possessions, such as the Drugs and Drug Trafficking Act 140

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 of 1992 and the Prevention of Organised Crime Act 121 of 1998, and the Films
and Publications Act 65 of 1996. The Animals Protection Act 71 of 1962
prohibits owners from causing harm to animals, while the Dangerous Weapons
Act 71 of 1968 and the Firearms Control Act 60 also regulate the use of
movable property.
Creditor’s rights of third parties against the owner
Contractual limitations on the exercise of entitlements by property owners do not
impose a real burden on the property, as they are enforceable only against the owner
in their personal capacity and do not encumber the property. This is not the case for
the owner's successors in title. Similarly, a third party can acquire certain entitlements,
such as a use right, through a contract with the owner, but these rights are enforceable
only against the owner personally and do not encumber the property. The doctrine of
notice applies to this situation. If a creditor's right acquired through a contract is
closely related to a registrable limited real right in respect of immovable property, it
can be registered in the deeds registry without the creditor's right becoming a real
right. If not closely related, the creditor's right is not registrable.
Limited real rights of third parties in the property
Ownership rights can be limited by other people's limited real rights, which differ
from creditor's rights in several ways. They limit the owner's ownership by removing
it from the dominium (subtraction from dominium), making it enforceable against the
owner and successors in title. In immovable property, these rights are created through
registration in the deeds registry, while in movable property, they are created by
delivery of the thing to the holder of the limited real right.
1. Purpose of neighbour law
Neighbour law aims to balance conflicting ownership interests by limiting the exercise
of entitlements by landowners or users of adjacent or nearby land. The purpose is to
harmonize the rights and obligations of these parties, ensuring that the landowner
exercises their entitlements reasonably and, if necessary, fairly. This approach ensures
that conflicting interests are balanced and the rights of all parties are respected.
2. Nuisance
Neighbour law is based on the principle that land should be used in a way that
does not prejudice or burden another person. If an owner or occupier causes
harm or disturbance to a neighbour, they act unreasonable, as stated in Gien v
Gien 1979 (T). If a land user's unreasonable actions cause patrimonial loss or
personal injury to their neighbour, they can resort to deictual remedies or
common law property law remedies, as they constitute an infringement of
ownership or the right of occupation. However, the two approaches do not
necessarily exclude each other. In some cases, the infringement can be
delictual, causing patrimonial loss or infringement of a personality right, while
in others, it can be an infringement of the owner's entitlements, resulting in a
real right infringement.
a. Nuisance in a Narrow sense

13
 Nuisance is an infringement on a neighbour’s use and enjoyment of their
land, which can be a violation of a personality right or entitlement of use,
such as health or undisturbed enjoyment of property, by means of noise,
smells, gasses. These infringements can normally be prohibited through an
interdict.
Criteria for reasonableness - The definition of a nuisance is typically repetitive or
continuous, with only unusual actions being those that would be unreasonable in the
community's opinion. These actions must be considered a nuisance by a normal
person. Factors such as property location, zoning, inhabitants' habits, and the
neighbour’s health can also affect the classification of the nuisance. A single short-
duration action is tolerated if there is a reasonable expectation of repetition.
b. Nuisance in a wider sense
Nuisance refers to the infringement of a neighbour’s entitlements or actions
causing damage, which can result in compensation or prohibition through
an interdict. This includes actions by the neighbouring owner or occupier.

(damage) A delict is a wide-spread act or omission that causes damage to a

neighbour, violating the law, committed in a culpable way, caused by an
action, and causing damage or injury to the injured party, if there is a legal
duty on a person to act.
Criteria for reasonableness - The weighing of interests between neighbouring owners
and occupiers is based on reasonableness, with the exercise of entitlements within
reasonable limits and mutual obligations. If unlawful actions cause damage, liability
must be determined using the actio legis aquiliae requirements, with culpability in
intent or negligence being a requirement. Although not a requirement for an interdict,
culpability is a requirement for delictual liability in terms of the actio legis Aquiliae.
(enables a Plaintiff to recover patrimonial loss (including purely economic loss)
suffered through a wrongful and negligent act of a Defendant)
Nuisance and abuse of rights
The question arises whether an owner who causes nuisance for their neighbour is
abusing their rights. If the owner acts with the exclusive purpose of harming their
neighbour and results in real damage or prejudice, their actions are unlawful and
cannot be considered an exercise of ownership. Examples of such conduct include
building a building to block a neighbour’s view or planting deciduous trees to allow
leaves to fall into their swimming pool or threshing floor. In such cases, it is
inappropriate to speak of abuse of right, as the unlawful activity cannot be classified
as any kind of right. However, sometimes the owner's conduct is lawful if the
exclusive purpose is not to injure their neighbour, even though their actions cause
their neighbour injury. The criterion of reasonableness is also applied, as neither party
acted unlawfully in this case.
3. Lateral and Surface Support

14
Landowners are entitled to the support provided by their neighbours, and they must
use their own land to prevent lateral and surface support from being undermined by
excavations for building or mining purposes. This obligation is influenced by English
law and is not applicable to building or other additions that add additional burden to
neighbouring land. Damage to additions on neighbouring land does not provide
remedies, except in cases where reduced lateral support caused damage to buildings.
This is an inherent characteristic of land ownership, ensuring that the landowner's land
is supported by the neighbour’s land in its natural state.
Principles that apply to lateral and surface support
(a) It is necessary only to prove that the neighbour has disturbed the lateral and
surface support and not to prove culpability in the form of either intent or
negligence.
(b) The plaintiff need not prove wrongfulness, but must simply prove that the
damage that had been caused by the removal of lateral support by the defendant
(c) Liability of the actor is not based on delict, but on the interference with a right
(entitlement) of the owner.
(d) The duty of lateral support only applies to natural land and not buildings and
additions. If excavations cause damage to neighbouring land, the owner cannot
claim compensation unless they can prove the excavation increased the burden
on the land. Compensation for damage to additions can be claimed. Building
regulations address building support to prevent issues in urban areas.

4. Encroachments
Encroachments can be from buildings or plants planted on neighbouring land.
South African law recognizes that landowners' entitlements extend into the air
above the land and into the earth below it. Interference with these entitlements
can lead to various remedies, as per the principle of "cuius est solum eius est
usque ad coelum et usque ad inferos."

4.1 Buildings - In common law, landowners had virtually unlimited

building rights, but they are now limited by statutory measures. The
cuius est solum rule applies, limiting the vertical boundaries of
landowners. Building foundations and additions cannot exceed ground
and air boundaries, as they cannot exceed the landowner's land.
If such encroachments occur, landowners have the following remedies:
(a) Removal - The owner can demand encroaching building parts be removed,
but cannot remove them themselves. Reasonableness and fairness are factors
considered in deciding removal. Courts must exercise discretion within
reasonableness criteria, considering factors like time since owner became
aware, encroachment nature, and cost.
(b) Compensation - Compensation can be awarded to a landowner if they did
not exercise their right to removal or if it would be unreasonable to demand it.
The court has discretion to award compensation in such cases, but the
reasonableness criterion must be clearly stated in the written defence.
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 (c) Transfer of encroaching section to encroacher - The defendant can be
ordered to transfer part of the land where the encroachment occurred as an
additional order to payment of compensation, which includes the cost of the
transfer, the value of the part without the encroaching improvement, and
damages. However, the defendant cannot claim the entire property transfer
against payment.
(d) Termination of occupation by encroacher. The landowner can terminate
the defendant's occupation of an encroaching building but must compensate the
defendant for the value of improvements made on their land. This order is only
made if the encroachment is an independent building, not in slight cases where
it forms part of a neighbouring building, due to the reasonableness criterion.
4.2 Branches, leaves and roots - Plant branches and leaves encroach on
airspace above a landowner's property or roots encroach on land under
the surface, but remedies differ from those for buildings encroachment.
Remedies;
(a) The landowner can request that neighbouring land owners remove
encroaching branches and leaves, and if they don't do so within a reasonable
time, the landowner can request an order to remove them themselves.
However, an order to remove will only be granted if the landowner has
given the neighbour a reasonable time. The landowner can only keep
chopped off branches if the tree owner gives permission or neglects to
remove them.
(b) Planting plants on a neighbour’s land grants them property through
implantatio, after taking root, allowing them to be removed or kept at will.
However, the neighbour cannot demand the defendant remove the plants
from the neighbour’s land.
(c) If trees on a neighbour’s land encroach on a landowner's, they can remove
the roots themselves, as stated in Bingham v City Council of Johannesburg
1934 (W). However, there is no authority for a landowner to get an order
for removal against the neighbour, but they can potentially get one based on
the nuisance caused by the trees.

5. Interference with the natural flow of water

Urban and rural land owners have different obligations regarding the natural
flow of water. Lower-lying rural land owners are required to show greater
tolerance for water flowing onto their neighbour’s higher-lying land. The flow
of water may be influenced by reasonable cultivation and building on the land,
but the interests of the neighbour must always be considered. In urban land, all
landowners are obliged to accept the natural flow of rainwater from higher-
lying land. Factors such as concentration, volume, or direction of the flow must
be considered to determine if it caused damage or nuisance to the lower-lying
owner. The burden of proof rests on the owner of the higher-lying land if
building activities disturb the natural flow of water.

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 6. Elimination of danger
Landowners are obligated to eliminate dangers from their land within
reasonable limits. This includes keeping wild animals or poisonous plants on
their land, ensuring neighbours are not threatened, and compensating for any
damage resulting from these actions. Landowners of cattle straying on roads
are also liable for damages to vehicles colliding with them. Landowners of
urban land who electrify common walls between neighbouring properties are
not unreasonably creating a dangerous situation. Landowners must also combat
temporary dangers, such as a veld fire spreading on their land, under the
National Veld and Forest Fire Act 101 of 1998. Landowners can claim
damages from landowners in cases of fires that originated on or spread from
their land.
NB! CHAPTER 8 – ORIGINAL ACQUISITION OF OWNERSHIP
Original acquisition of ownership does not require the lawful ownership of a legal
predecessor, unlike derivative acquisition. The benefits and obligations of the previous
owner are not typically passed to the new owner, but can be transferred in
extraordinary circumstances. If there is no legal predecessor, ownership can be
acquired through appropriation (occupatio) of a thing not owned (res nullius) or
abandoned by its owner (res derelicta).
The previous owner's cooperation is not necessary for original acquisition, but
derivative acquisition can only occur legally with the previous owner's cooperation. In
some cases, ownership is passed to the new owner without the predecessor's
cooperation through accession, prescription, and expropriation, and ownership is not
transferred.
1. APPROPRIATION (occupatio)
It is the unilateral exercising of physical control over a corporeal thing that can
be owned (res in commercio), but is not owned by anyone (res nullius or res
derelicta) with the intention of becoming the owner.
Requirements;
(a) Physical control (corpus) - Physical control of an object depends on the
circumstances and object's nature. It doesn't have to be lawful; unlawful control
can lead to ownership, like pornography material. Statutory restrictions may
prevent ownership acquisition in certain cases.
(b) with the intention to become the owner (animus domini) - The controller
must exercise physical control with the intention of being the owner (animus
domini).
(c) of a corporeal thing not belonging to anyone - The control must be exercised
in respect of a corporeal thing, which does not belong to anyone. A distinction
is made between things which are not owned by anyone (res nullius) and things
which have been abandoned by the owner (res derelictae)

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Things with no owners’ (res nullius)
(aa) Common law principles dictate that wild animals, birds, reptiles, fish, and
insects have no owners if they are in their natural state, escaped, disappeared,
or within sight but cannot be pursued. If a controller exercises physical control
over a wild animal with the intention to become owner, they become owner by
appropriation.
(bb) The Game Theft Act 105 of 1991 allows owners of wild animals held for
commercial or hunting purposes on land fenced in accordance with section
2(2), or in a cage, kraal, or vehicle, to retain their ownership even if the animals
escape or are removed without the owner's permission.
(cc) Domesticated animals are animals which are wild by nature, but which are
owned by someone because they are in the habit of returning to the owner. As
soon as they no longer have the habit of returning, they are no longer owned
and can be appropriated
(dd) Domestic animals, such as dogs, cats, horses, chickens, cattle, and sheep, are
not considered wild in the community's eyes. They remain the owner's
property, and can only be appropriated if the owner abandons ownership or the
animals become wild. Fruits like honey and young animals' young belong to
the owner of such animals through appropriation.
(ee) Renewable sea products, such as sea grass, shells, shell fish, and fish, have no
owner and can be appropriated, but not substantial parts of the sea or shore, as
they belong to the public in general (res publicae)
Things that have been abandoned (res derelicta)
“Abandoned things are lost or thrown away by the previous owner with the intention
of renouncing ownership. In these circumstances ownership can be acquired through
appropriation”
If an object is lost without the owner giving up ownership, the person who finds it
cannot become owner through appropriation. The intention to abandon a thing is not
lightly assumed when a thing is lost. A shipwreck that has not been salvaged by its
owner is an example of a res derelicta. The legal position of shipwrecks is determined
by the Wreck and Salvage Act 94 of 1996, which applies the International Convention
of Salvage of 1989. In some cases, things do not become res derelictae after being
abandoned but become the property of the state.
2. ACCESSION – (accessio)
Occurs when two corporeal things, usually a principal and an accessory, are
combined through human activities or natural processes, causing one to lose its
independence and become a component of another. The principal thing remains
independent, while the accessory thing loses independence. The owner of the
principal thing becomes the owner of the new thing through law, without
necessarily being aware of the accession.

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 Accession is not a transfer of ownership, but a process where an accessory
thing loses its independence and the principal thing is extended due to a
merger. It is considered the original acquisition of ownership, as it usually
occurs without the owner's cooperation. Ownership of the accessory thing is
not transferred, the accessory thing becomes part of the composite thing, no
longer an independent object.

Passing of ownership through accession takes place only if;

(a) the composite thing is not divisible
(b) the principal and accessory things can be distinguished
(c) the accession does not amount to manufacture (specificato)
The test for determining which is the principal thing and which the accessory
thing, is based primarily on the question of which thing has lost its
independence (accessory thing) and has become part of the other thing
(principal thing). Other factors are also taken into consideration, such as which
has the greater mass (principal thing) or value (principal thing) and which
serves merely as decoration (accessory thing).

2.1 Accession of immovables to immovable

Accession of two immovables usually takes place naturally without human
activities or interference by the gradual adding of soil to a piece of land by
alluvion or the sudden addition to a piece of land through flooding
(avulsion).
(a) Alluvion (alluvio) - Water-induced soil addition is the gradual and
unnoticeable addition of soil to land through mud, soil, and silt deposits.
If the land's surface is not expanded due to soil deposited on top, the
landowner becomes the owner of the mud, silt, or soil added to their
land.
(b) Avulsion (avulsion) - is the sudden addition of land due to flooding or
water flow, which is clearly visible and takes place through a violent
avulsion of a piece of land to the existing land.
(c) Forming of islands - An island created in a river-bed through natural
water flow benefits riparian owners based on its location. In the case of
ager non limitatis, the borders of riparian owners' land are considered
the middle of the river. In Pocock v De Oliviera 2010, it was ruled that
alluvio and avulsio are only applicable to natural accession, not to the
combination of two tracts of land through notarial deed registration.

2.2 Accession of movables to immovable

The transfer of movables to immovables typically occurs through human
activity, where a movable is permanently attached to an immovable. The
owner of the immovable becomes the owner of the composite thing, and
must compensate the previous owner in certain circumstances.
The doctrine of superficies solo cedit states that when a movable thing is
attached to an immovable, it is considered the accessory thing, while the

19
land is considered the principal thing. The movable accessory becomes
immovable.

(a) Planting and sowing (plantatio et satio)

Is a process where movable objects are attached to the land, becoming
the property of the landowner, and everything growing in the soil
becomes part of the land.

The following principles apply;

(aa) A plant removed from soil remains the landowner's property as it
obtained nourishment from it. A tree on A's land, which receives
nourishment from B's land, is also the property of B, as stated in
Secretary for Lands v. Jerome 1922.
(bb) Plants on land boundaries between A and B belong to the
landowner whose soil has the most roots. If the roots are
distributed equally, both parties have equal undivided shares in
the plant. If most roots occur on A's land, B has no rights to the
tree, except for requiring removal of encroaching roots.
(cc) The principles for acquiring plant ownership through accession
apply regardless of the person planting or sowing. However, in
specific legal relationships between landowners and sowers, it
can be regulated by contract. Examples include agreeing to
remove plants later or removing shrubs or harvests before a lease
contract expires, under the right to removal (ius tollendi).

(b) Building (inaedificatio)

Building is the process of attaching a movable item to land, with the
intention of making it part of the land and becoming the property of the
landowner. The accessory item is a part of the composite thing, which is
then the property of the landowner.

Criteria;
(aa) Nature and purpose (objective)
The item must be permanently attached to an immovable item and serve
a permanent purpose on the land, such as bricks, cement, or roof tiles. If
the item is unclear about its permanent attachment, such as if it has lost
its independence, the other two criteria must be used to determine if the
item forms part of the land.
(bb) Manner and degree of attachment (objective)
The attachment of an accessory to land is not based on the intention
behind it, as seen in Standard-Vacuum Refining Co of SA v. Durban
City Council 1961 (A). The key test is whether the accessory can be
removed without damaging the land, which is a matter of fact related to
the common-law requirement that the accessory must be attached
'aardvast' (as firmly as the soil) or 'nagelvast' (as firmly as the nail) to
the land.

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 (cc) Intention of the annexor (subjective)
The subjective intention of the annexor must be investigated if the
nature and purpose of the accessory thing do not determine whether it
has been permanently attached to the immovable thing. In Standard-
Vacuum Refining Co of SA v Durban City Council 1961 (A), the court
ruled that the objective intention of the annexor should be determined
based on the nature and purpose of the annexor's attachment, while the
subjective intention must be determined.

The owner of a movable item who loses ownership due to inadequacy to

the landowner has recourse. The remedies include;
(i) A bona fide and mala fide owner of an immovable can claim
enrichment and other remedies for compensation for the loss of
the attached item.
(ii) The lessee of an immovable has a right to removal (ius tollendi)
of certain attachments before the lease expires.

2.3 Accession of movables to movables

If a movable is attached to another movable in such a way that a single
thing is formed, the owner of the principle thing acquires ownership of the
composite thing and the owner of the accessory thing loses ownership

Requirements are;
(a) The various elements of the composite thing (principle and accessory)
must still be recognised
(b) The composite thing must be difficult to separate; and
(c) it must not amount to the forming of a new thing with someone else’s
materials (specificatio)
i.e. weaving in of materials –the owner of the material becomes the
owner of the weaving thread even if the thread is more valuable, but the
owner of the thread can claim damages or enrichment.
i.e. Painting – the painter becomes the owner of the cloth or board of
someone else on which he painted.

3. MANUFACTURE (specificatio)
is the acquisition of ownership in a manufactured thing by a person using the
materials or thing of another person, without the owner’s permission, to
manufacture a completely new thing.

Requirements
(a) Common law states that a product cannot be changed back to its original
form, like wine from grapes, beer from malt, or a ship from planks. Metals
that can be returned to their original form after manufacture cannot be
acquired through manufacture. Even if the new thing is more valuable than
the material, ownership does not pass to the manufacturer, except in cases
where it would be difficult to return it.

21
 (b) Common law requires manufacturers to have good faith in their ownership
of a material, but some jurists argue that this is a reward for their work. The
owner of the material can claim compensation for the loss, and therefore, it
is better if good faith is not required for practical reasons.
(c) The manufacturer cannot manufacture a thing without the owner's
permission, and if they did, ownership does not transfer to them. They only
have a claim for their labour or an enrichment claim for services rendered.
Remedy: The owner of a material can claim against the owner of a new thing if they
in good faith believed they were using their own material. They can institute an
enrichment claim for the material's value or a claim for damages under the actio legis
Aquiliae. In cases of bad faith, the manufacturer must prove negligence. If the
manufacturer acted in good faith but ownership did not pass due to non-met
production requirements, they can claim compensation for their labour.

4. MIXING AND FUSING (commixtio et confusio)

Mixing, also known as commixtio, occurs when solids belonging to different
owners are combined. On the other hand, fusing, or confusio, happens when
liquids and liquid solids belonging to different owners are mixed without their
consent. These actions do not involve attaching an accessory thing to a
principal thing or creating a new thing. The determination of joint ownership of
the mixed entity is based on the proportion of constituent elements it contains.
The mixed thing must be indivisible, meaning it's impossible to determine
which elements belong to which owner. Mixing must occur without owner
permission, and if owners agree, they become joint owners. If money is mixed
to be unidentifiable, ownership is acquired through commixtio, ignoring the
principles mentioned above.

5. ACQUISITION OF FRUITS
Acquisition of ownership in fruits takes place by means of separation or
gathering. Before separation from the fruitbearing thing the hanging fruits
(fructus pendentes) are accessory things to the principal thing and therefore
ownership vests in the owner of the principal thing. After separation a
distinction is made between fruits separated from the principal thing naturally
(fructus separati) and gathered fruits (fructus percepti).

A distinction is made between;

(a) natural fruits - animals, birds, insects, trees, plants, and grain can be
harvested, while young trees grow after a plantation is felled. Organic and
inorganic materials like wool, milk, salt, and river sand renew themselves.
(b) civil fruits - This includes rent, interest on capital, profit from an
undertaking, and dividends on shares.
Exceptions to the general rule of (after separating and gathering fruits are usually
the property of the owner of the principle thing or fruit bearing thing)

22
 (a) a bona fide possessor becomes the owner of all separated fruits after gathering.
A mala fide possessor is not entitled to fruits.
(b) A usufructuary is entitled to fruits after gathering. The usufructuary is always
obliged to maintain the fruitbearing property
(c) A lessee is also only entitled to the fruits after gathering them.

6. EXPROPRIATION
The expropriation the ownership of a thing, movable or immovable, vests in the
expropriator; while the previous owner loses his ownership without consenting
thereto; against payment of compensation to him.
In terms of section 25 of the Constitution of the Republic of South Africa of 1996 the
state may expropriate rights in property for public purposes or in the public interest.
Although, the state has the capacity to expropriate through various Acts, the general
principles of section 25 of the Constitution and the Expropriation Act 63 of 1975 must
be followed regarding the extent of compensation.

6.1 The Expropriation Procedure must comply with the Expropriation Act
(a) section 6 provides that the decision to expropriate is made by the
administrative body in accordance with the relevant law and thus cannot be
contested or reviewed by the courts.
(b) section 7 requires that the notice must accurately describe the object being
expropriated, it must specify the date of expropriation and must include either
an amount of compensation or a request for the owner to submit a claim for
compensation (monetary) within 60 days.
(c) section 8 provides that the ownership of immovable property is transferred
automatically to the expropriator (state) on the date specified in the notice of
expropriation, and the expropriator assumes ownership subject to any limited
real rights that may exist, unless those rights are also expropriated.
(d) sections 7 (2) (c) and (d) and 9 to 12 outlines the procedure for claiming,
negotiating and paying compensation. If the owner cannot reach an agreement
on compensation the Act states that it can be decided by a compensation court,
land claims court or a provisional division of the supreme court.

6.2 COMPENSATION
Section 25 of the Constitution mandates that compensation must be
determined through an agreement. If an agreement cannot be reached, the
court must determine the just and equitable compensation, considering the
public interest and the interests of those affected. Relevant factors to
consider include:
(a) the current use of the property
(b) the history of the acquisition and use of the property
(c) the market value of the property, that is, the amount for which a willing
seller would have sold the property to a willing buyer
(d) the extent of direct state investment and subsidy in the acquisition and
beneficial capital improvement of the property and;

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 (e) the purpose of the expropriation

In terms of the Expropriation Act and the decision in Kangra Holdings v Minister of
Water Affairs 1998 (A), the dispossessed owner is entitled to compensation for the
real financial loss suffered as a result of the expropriation. This includes the cost of
looking for a new house, transport costs, moving costs, and the costs of new curtains
and furniture (if the previous ones do not fit into the new house). Additionally, a
consolation money (solatium) of 10% of the total amount, but to a maximum of R10
000, may also be claimed.

It is important to note that the dispossessed owner must only be compensated for their
loss and should not be advantaged by the expropriation. This principle was
emphasized in City of Cape Town v Helderberg Park Development (Pty) Ltd 2007
(SCA).

7. FORFEITURE AND CONFISCATION

Forfeiture refers to things used by or with the consent of the owner to commit a
crime. This thing can be declared forfeit to the state in terms of a court order if
it is authorised by statute.

- Forfeiture takes place without any compensation to the owner and

ownership passes to the state at the moment on which the order is made.
- The Criminal Procedure Act 51 of 1977 allows for the forfeiture of
weapons and other objects used in connection with a crime. Other acts
include the Films and Publications Act 65 of 1996, the Drugs and Drug
Trafficking Act 140 of 1992, and the Prevention of Organized Crime
Act 121 of 1995.
- The main purpose of these legislation is to prevent racketeering, money
laundering, and criminal gang activities. The drug Acts authorize
forfeiture of dependence-producing substances, immovable, and cash to
the credit of the accused at a financial institution. In National Director of
Public Prosecutions v Parker 2006, two factors must be considered in
the case of forfeitures: whether the money or goods were instrumental to
the crime and if the owner was aware of the crime. In cases where game
is involved, the forfeiture is based on the state's discretion.
 Confiscation occurs when property is confiscated by the state if it is regarded
as being in the public or states interest to do so. This will usually be the case in
a declared state of emergency or during a period regarded as an emergency or
in self-defence in common law.
 Compensation is usually payable by the state except if excluded by relevant
legislation
 Section 25 of the Constitution provides that confiscation may only take place
by means of general law application, which has to comply with strict
requirements.

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 Section 37(4) of the Constitution states that in a declared state of emergency,
legislation can only derogate from fundamental rights if it is strictly required by
the emergency and in line with international law.

8. STATUTORY PASSING OF OWNERSHIP

- Statutory passing ownership occurs without the previous owner's
cooperation, but the limitations of the previous owner's ownership are
also passed on to the new owner, distinguishing it from other forms of
original ownership acquisition and often referred to as a derivative form
of passing ownership through general title.
- The Insolvency Act 24 of 1936 states that assets of a sequestrated estate
are transferred to the master of the high court immediately after the
sequestration order and to the curator after appointment. The assets of
the solvent spouse of an insolvent also pass temporarily to the master or
curator. In the Companies Act 71 of 2008, the ownership of a liquidated
company's assets passes to the liquidator in their official capacity, with
the master of the high court in physical control of the assets before the
liquidator's appointment.

9. PRESCRIPTION
9.1 The Prescription Act 18 of 1943

Acquisitive prescription is original method of acquisition which a real right

is acquired in respect of movable or immovable things by means of open
and undisturbed possession thereof or the exercise of rights in respect
thereof for uninterrupted period of 30 years Purpose: not only to punish for
not exercising the right but to ensure position which has existed for long
period

Requirements for acquisitive prescription;

- Possession: Claimant must have been in continuous and uninterrupted
possession of the property for prescribed period over the property and
exercises by claimant or someone acting on their behalf Animus/mental
element: Claimant must have possessed the property with the intention
to be owner – not dependent on good or bad faith
- Without force (nec vi) – If a person needs to keep physical control of a
thing with force, prescription will not run in his favour. Acquisition
must occur without coercion or violence.
- Open and freely (nec clam) requires a person to possess a thing openly,
not secretly, and use it as if an owner would. The owner must be aware
of this if they showed reasonable attentiveness. The objective is whether
a reasonable man could conclude from the possessor's actions that they
possess the thing as if they were the owner.
- Without the owner’s consent and adverse use: In possession or use of
the property without consent or co-operation of the owner and use are
true to the owner

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 - Period: Uninterrupted and continuously period of 30 years – immovable
property

Method of Prescription calculation

If the impeding situation or circumstance ends before three years before the
prescription period, the prescription is not suspended under section 3, but it remains
unsuspended for 30 years. If the situation persists for three years or more before the
prescription period, the prescription is completed only three years after the impeding
situation or circumstance ceases to exist.

Consequences of Prescription
After completion of the period of prescription and if all the requirements of
prescription are
met, the possessor becomes the owner of the thing. In the case of movables ownership
passed (and was not transferred by delivery); in the case of immovables ownership
passed
without registration of the immovable thing. The new owner can then, in terms of
section 33
of the Deeds Registries Act 47 of 1937 apply for a court order to have the property
registered in his name. In terms of sections 33(8) and (9) all existing (registered)
limited
real rights must be included in or endorsed on the new title deed, unless such limited
real
rights have been cancelled in terms of the court order. Although section 19 of the
Prescription Act 68 of 1969 provides that prescription can run against the state, it is
qualified
by the provision of section 18 that the

NB! CHAPTER 9 – DERIVATIVE ACQUISITION OF OWNERSHIP

The derivative transfer of ownership requires the cooperation of the current owner,
who must sign a bilateral juridical act. The new owner must accept all rights from
their predecessor's ownership but also accept certain obligations or limitations. The
nemo plus iuris rule states that no person can transfer more rights than they own, and
all limitations with real effect are transferred to the new owner.
*IURIS PLUS NEMO - no one can transfer a greater right than they possess
themselves”
9.1 Requirements for transfer of ownership
o The thing must be negotiable (res in commercio)
o The transferor must have contractual capacity (legal age, mental health
and marital status)

26
 o The transferor must be the owner of the thing, he cannot undertake the
transfer himself and it can be undertaken on his behalf by an agent or
nominee.
o The transferee must have contractual capacity to accept the transfer of
ownership, a transferee with limited capacity must be accompanied by
parent or guardian or curator.
o The ownership must be accepted by the transferee or his nominee
o The transfer of ownership in the case of movables take place only if the
thing is delivered to the transferee in a legally accepted manner
(traditio). In case of immovables transfer of ownership takes place by
means of registration in the deeds registry.
o The delivery of movables and registration of immovables must take
place with the intention of the owner to transfer ownership and with the
intention of the transferee to accept ownership
o There must be a legal cause (causa) for the transfer of ownership
o If ownership is transferred on the basis of a preceding contract of sale, it
is transferred to the buyer only if the full purchase price has been paid,
unless credit was granted by the seller to the buyer – this indicates the
intention of the owner.

9.2 Abstract system of transfer of ownership

Since the Commissioner of Customs and Excise v Randles, Brothers and
Hudson 1941 (A) decision, South African law has followed an abstract
system of transfer of ownership, allowing ownership to be transferred
despite the invalidity of the preceding obligatory agreement if there was a
valid real agreement with delivery (movables) or registration (immovables).

However, this does not mean that there is no legal cause (causa) for the
transfer of ownership. Usually the cause will be contained in a preceding
obligatory agreement such as a contract of sale, exchange or donation.
A valid obligatory agreement is, however, not required as legal cause.
Should the obligatory agreement be invalid, the parties’ intention to transfer
and receive ownership can be deduced from other circumstances. In these
cases the legal cause for the transfer of ownership can be found in the
circumstances from which the intention is deduced. It may, for instance, be
the signing of the transfer documents or the payment of the transfer costs or
purchase Page 144 price.
In Quartermark Investments (Pty) Ltd v Pinky Mkhwanazi 2014 (SCA) it
was held that an invalid obligatory agreement in the case of fraud
automatically results in an invalid real agreement. It is suggested that a
court must in every instance of an invalid obligatory agreement determine
whether the invalidity of the obligatory agreement has the consequence that
the parties do not have the intention to transfer ownership. If such intention
is present, a valid real agreement exists in spite of the invalid obligatory
agreement – Du Plessis v Prophitius 2010 (SCA). In these circumstances
the bona fide recipient is protected at the expense of the previous owner.

27
 The previous owner’s only remedy in these circumstances is a personal
action (usually in the form of an enrichment claim or condictio) against the
bona fide recipient in the case where the transferee was enriched as a result
of the invalidity of the obligationcreating agreement. The previous owner
cannot institute a claim based on a real action, since ownership was
transferred to the bona fide recipient.

9.3 Cash and credit sales

- Ownership is transferred in a cash sale only after the purchase price is
paid in full, except in cases where the seller grants credit to the buyer
and ownership is transferred before the full payment (credit sale). If
there is no explicit provision for credit, the presumption is that the
transaction is a cash sale.

- The presumption of ownership in a contract can be rebutted by the

circumstances at the time of the contract's conclusion, such as the
seller's agreement to accept payment after delivery or security for the
purchase price. In Eriksen Motors (Welkom) v Protea Motors Warrenton
1973 (A), it was determined that the rule does not apply in all cases and
that the circumstances must determine whether the parties intended a
cash or credit transaction. In a credit transaction, ownership may not be
transferred until the purchase price is paid in full, subject to a suspensive
condition. Some credit agreements, subject to the National Credit Act 34
of 2005, also fall into this category, with ownership not transferred until
the last instalment is paid.

9.4 Delivery
is the transfer of physical control of a movable to the transferee in order to
enable him to exercise control of the movable with the intention to be the
owner (animus domini)
 Delivery can also mean the delivery of physical control of the thing with the
intention that the ownership in the thing vests in the transferee
 Also, that the mere delivery of physical control over the thing without any
intention that ownership is transferred to the transferee.
In common law delivery was developed in such a way that it refers to:
 Physical delivery (traditio vera)
 The act of transfer,
It is accepted that delivery takes place when something happens that enables
the transferee to exercise physical control over the thing with the intention to
be the owner. This is known as fictional or constructive delivery

9.4.1 Actual Delivery

- indicates that the movable is actually handed over to the transferee in
such a way that the transferee is able to exercise physical control with
the intention to be the owner. The delivery needs to be made in person,

28
 but can also be made to a family member or representative of the
transferee.
9.4.2 Constructive delivery (traditio ficta)
- Takes place where the act of transfer is not as explicit as the case of
actual delivery, but where a change occurs in the intention with which
the thing is controlled, which indicates the intention of the ownership is
transferred
Categories of constructive delivery
(a) Clavium traditio
A thing is delivered by clavium traditio if it cannot be
physically handed over to the transferee due to its nature or
size, but an instrument allowing the transferee to exercise
physical control is given.
(b) Delivery with the long hand (traditio longa manu)
occurs when a physical delivery is not possible due to the
item's size, weight, or nature. The item is pointed out to the
transferee, allowing them to control it, such as with a heap of
bricks, a herd of cattle, or farm implements.
(c) Delivery with the short hand (traditio brevi manu)
takes place when the transferee is already in physical control
of the thing, but without the necessary intention to be owner,
so that (constructive) delivery takes place when the intention
of both parties change to such an extent that the transferee in
future exercises physical control with the intention to be
owner.

(d) Constitutum possessorium

Ownership is transferred without the thing being actually
delivered to the transferee. Transfer takes place by means of a
change of intention of the parties in respect of ownership. The
thing remains in the physical control of the previous owner,
who exercises the physical control for or on behalf of the new
owner or for another valid legal cause (causa) for continued
physical control.
(e) Attornment
Delivery by attornment takes place if ownership of a movable
must be transferred by owner A to B, but at the time of
delivery the movable is in the physical control of C, who
exercises physical control in terms of a valid legal cause.
Ownership is transferred to B if C agrees to exercise physical
control on behalf of B and no longer on behalf of A.

29
9.5 Registration
9.5.1 Publicity principle
- Registration is required for the creation, transfer and termination of all
real rights in immovable property, because of the application of the
publicity principle. The transfer of ownership in immovables takes place
by means of registration in the deeds registry. This is a manifestation of
the delivery requirement for the transfer of ownership of immovables.
- The publicity principle, rooted in history, involves drafting written
transfer documents for land transfers and registering them as proof of
ownership. This procedure has been applied in Cape Town since the
seventeenth century, following the Netherlands' registration procedure.
This procedure, along with local customs, forms the basis of the Deeds
Registries Act 47 of 1937.

9.5.2 Characteristics of the registration system

(a) Registration of deeds
The South African registration system, based on section 16 of the
Deeds Registries Act 47 of 1937, initially relied on the registration of
deeds (documents) at face value. However, the procedure has
evolved over time to provide security for ownership or limited real
rights regarding immovables. Transport documents are no longer
registered at face value but are thoroughly checked by the deeds
registry staff. Registration only occurs if all documents are correct
and meet the requirements set by the Deeds Registries Act 47 of
1937. The information in the deeds documentation must agree with
cadastral information (land surveyor's maps). The registrar of deeds
and his staff are legally obliged to ensure the correctness and
completeness of deeds registers. The transfer of title is confirmed by
the registration of deeds.
(b) Negative registration
A negative registration system in South Africa does not guarantee
the correctness of registered information, and it does not protect real
rights acquirers from deficient information. The staff of the deeds
registry cannot be held liable for these individuals. The real owner or
holder of a right is protected against all other persons. The
correctness of registered information cannot be guaranteed due to
several ways in which real rights can pass without deeds records
being simultaneously amended. For example, the original acquisition
of ownership by accession, prescription, or marriage in a community
of property does not reflect or confirm this passing of ownership,
making the South African system negative and not providing an
absolute guarantee regarding the correctness of registered
information.

9.5.3 Registration procedure

(a) Map or general plan

30
- Immovable property can only be registered in the deeds registry using a
map, diagram, or general plan, which must be an approved surveyor's
map or aerial photograph, as per the Land Survey Act 8 of 1997. For
sectional titles, every unit must be described using a sectional plan as
per Sectional Titles Act 95 of 1986.
(b) Statutory requirements
- Several statutory limitations on subdivision and alienation must be kept
in mind Various provincial ordinances still regulate the establishment of
towns, but provincial legislation to replace existing ordinances is in
preparation by the nine provinces in terms of the Constitution of 1996.
Several other provisions dealing with township establishment are also
applicable. The Spatial Planning and Land Use Management Act 16 of
2013 contains provisions to simplify and consolidate township
establishment in these areas. The Sectional Titles Act 95 of 1986
regulates the establishment of sectional title schemes.
(c) Obligation-creating real agreements
- Derivative acquisition in sale, exchange, or donation typically occurs
after the conclusion of a valid obligatory agreement and real agreement,
as per the Alienation of Land Act 68 of 1981 and Sectional Titles Act 95
of 1986 and Property Time-sharing Control Act 75 of 1983. Registration
can also occur after ownership has passed through original acquisition,
such as prescription, expropriation, or marriage in a community of
property. In such cases, no preceding obligatory and real agreement is
required, but a court order, application, or notice are required by the
deeds registry. Derivative transfer can occur even with invalid
obligatory agreements, as long as a valid real agreement exists. The real
agreement is not included in the deed of transfer but is evident from
circumstances such as signing powers of attorney, sworn statements,
transfer fees, or purchase price payments.
(d) Deed of transfer
A deed of transfer is a legal document that outlines the transfer of
ownership of property. It is governed by section 20 of the Deeds
Registries Act 47 of 1937, which includes several forms for conforming
to various circumstances. The general form includes a preparation
certificate, a heading, a preamble, a recital, a vesting clause, a
description of the property, a description of the land, and an extension
clause. The preamble contains the full names, identity numbers, and
marital status of the transferor, indicating that the transferor grants the
conveyancer power of attorney to handle the transfer. The recital details
the legal cause for the transfer, such as a contract of sale or donation.
The vesting clause details the description of the transferee, ensuring
ownership is transferred to them. The description of the property is
based on cadastral information, while the extension clause references the
original deed and the transferor's deed.
(e) Supporting documents

31
 The deed of transfer typically requires a power of attorney for the
conveyancer to sign on behalf of the transferor, a clearance certificate
from the local authority confirming all taxes and levies have been paid,
and a transfer duty receipt confirming all transfer duties have been paid
to the receiver of revenue in accordance with the Transfer Duty Act 40
of 1949. If the transferor alienates property as part of their business,
transfer duty need not be paid, as per section 7(1) of the Value-Added
Tax Act 89 of 1991. The existing deed of transfer of the transferor is
also required. Consent to the registration of servitudes and restrictive
covenants is also required, as well as consent to cancel the restriction by
the person in whose favour the servitude or restrictive covenant is in.
These documents are not accompanying documents to the deed of
transfer but are registered separately.
(f) Linking transactions
The deed of transfer and related documents are submitted to the deeds
registry in the land's province, where they are linked to determine the
sequence of consecutive registration proceedings. The importance of
linking these documents lies in the financial implications of the
proceedings, which are typically the consequences of the transfer.
(g) Sequence of relative causes
Section 14 of the South African law mandates that deeds must follow
the sequence of their relative causes, ensuring that land transfers and
real rights cessions follow the sequence of consecutive legal acts or
succession. This prevents avoidance of transfer duties and taxes and
ensures that the registration process accurately reflects the real course of
transactions. Section 14 forms a cornerstone of the South African
system of registration, ensuring the secure and uncontested right of the
entitled person.
NB! CHAPTER 10 – PROTECTION OF OWNERSHIP
There are three remedies available to the owner of a thing when ownership or
entitlements of the owner of a thing are infringed upon.
10.1 Real Remedies - To restore physical control of a thing or to remove any
infringement of the owners’ exercise of entitlements to the thing
 Rei Vindicatio – is the action whereby an owner can recover an existing and
identifiable thing from any person who is exercising unlawful physical control
over it.
Requirements for rei vindicatio
- The owner must prove ownership of the thing
- Only an existing and identifiable thing can be reclaimed
- The property must be in control of the defendant when the action is
instituted
Defence against rei vindicatio
- The defendant can prove that the claimant is not the owner of the thing

32
 - If the thing is destroyed or is unidentifiable, can be raised as defence
- Further defence can be that the defendant can proof that he was not in
physical control of the thing at the time when rei vindicatio was
instituted
- The defendant can show that he has a limited real right or creditors right
in terms of which he exercises corpus and that this right is still valid
- The defendant with a lien over the thing remains in corpus of the thing
until the obligation which gave rise to the lien has been fulfilled by the
owner
- Estoppel can also be raised against rei vindicatio of the owner if the
owner acted in a specific way (i) intentional or negligently (culpably, (ii)
created an impression that the ownership was transferred to the physical
controller of the thing and (iii) the controller, relying on this impression
exercises physical control with the owner’s intent (animus domini)
- Thus can raise estoppel as a defence against the rei vindicatio of the
owner.

 Actio Negatoria – is a real action aimed at protecting the exercise of an

owners’ entitlements arising from his or her ownership of movable or
immovable property.
Requirements for actio negatoria
- It is a real remedy that can be instituted by the owner of a thing
- It can be instituted as a result of infringement of the entitlements of an
owner or if a holder of a servitude exceeds his entitlements
- It can be instituted in respect of movable and immovable property
- It is a real action that can result in either a declaratory order or damages
The actio negatoria was a traditional legal action used against individuals
attempting to enforce servitudes or exceed entitlements. It evolved to be
used by owners against infringement of their entitlements, regardless of
whether the transgressor relied on servitudes or other limited real rights. It
was extended to movables infringement but remains a solely owner-
initiated action. This action allows for declaratory orders to have structures
erected or destroyed, rights declared, or damages recovered without
meeting delictual liability requirements. However, in South African law,
this action has largely fallen into disuse, as protection is now provided by
interdicts or declaratory orders.
 Interdict – is a summary court order, usually issued upon urgent application by
which a person is ordered to either do something, stop doing something or
refrain from doing something, in order to stop or prevent an infringement of
property rights
Requirements
- Proof of a clear right regard to property
- Proof that the respondent infringes upon the right unlawfully and in an
ongoing continuing way, or that there is a reasonable expectation that

33
 such an infringement will occur in the future; and that it will cause the
applicant damage.
- Reasons why there is no other effective remedy available to the
applicant.

 Declaratory Order – is a court order issued upon application in which the

court sets out the rights and obligations of parties to a dispute before an actual
infringement takes place.
Requirements;
- proof of actual existing or future right or obligation with regard to property
- proof of an existing and real dispute about the right of obligation in question
- Convincing reasons why the circumstances make it necessary for the court to
make a declaratory order to solve the dispute by setting out the rights and
obligations of the parties.
10.2 Delictual Remedies - Actions of the owner against a person aimed at
compensation for damages or loss to the owner’s property, resulting from the unlawful
and culpable actions of such person. Delictual remedies for part of the law of delict
 Actio ad exhibendum – is instituted by the owner against the controller of a
thing who has fraudulently lost physical control of the thing, in which case the
value of the thing can be claimed from such a controller.
Requirements
(a) the thing must be destroyed or alienated on purpose, it is not sufficient to
just prove negligent behaviour of the owner
(b) it could have been consumed, destroyed or alienated in any other way
(c) the controller must have been mala fide at the time of destruction or
alienation of the thing in that he had knowledge of the owners rights at that
stage. This includes the thief and any mala fide controller of the thing who
became aware during or after receipt of the thing that she controls the thing
mala fide.
(d) this remedy is only available to the owner of destroyed and alienated
property and the owner is entitled to recover the market value of the thing
from the mala fide controller.

 Conditio furtiva – is instituted by the owner or lawful controller of a thing

against a thief or a thief’s heirs and is an action with which the thing or the
highest value of the thing since the theft can be claimed.
- If the item is still under the thief's or his heirs control, it should be
claimed with the rei vindicatio, while the actio ad exhibendum is used
for intentional destruction or consumption. However, if the item was
accidentally destroyed by accident or removed from his control against
his will l, the condictio furtiva is the best action an aggrieved party can
take.
 Requirements
- the owner, lawful holder or any other person with a lawful interest in the
thing can institute the condictio furtiva only if he retained his ownership

34
 or interest in the thing from the date of the theft until the date of the
institution of action
- if the thing is destroyed and the owner’s ownership is terminated
thereby the previous owner retains the remedy
- it can only be instituted against the thief or his heirs and not against
accessories or later bona or mala fide acquirers.
- If the thing itself can no longer be claimed, the claim will be for the
highest value of the thing since the theft
- the action cannot be instituted together with rei vindicatio, but only in
the alternative.

 Actio legis Aquiliae – if a thing has been damaged or destroyed in an unlawful

and culpable way the owner can claim damages with this action for patrimonial
loss from the person who caused the damage.
Requirements
(a) an action pertaining to a thing
(b) which in an unlawful way and,
(c) performed with a culpable disposition (intent or negligence)
(d) resulted in
(e) damage or injury to the owner
**delictual liability can arise from either act or an omission

 10.3 Enrichment Remedies – Aimed at the payment of compensation by a

person who was enriched at the expense of the owner without a legal ground
for the enrichment.
Requirements;
(a) the controller must have been enriched, that is the controllers estate must
have been enlarged
(b) the owner must have been impoverished, that is the owners estate must have
been diminished
(c) the enrichement of the controlled must have been at the expense of the
owners’ impoverishment
(d) the shift in value must have been without legal cause (sine causa) which
means that there may not have been any legal basis for the shift
(e) The owner must have transferred the control of goods to the controller who
must have alienated or consumed them bona fide
(f) the balance pf the purchase price for which the controller sold the thing and
which, at the time of institution of the condictio sine causa, remained in the
controllers possession or the value of goods as at the institution of the
conditio can be claimed
CHAPTER 12 (SUMMARIES OF END OF CHAPTERS)
POSSESSION AND HOLDERSHIP
The distinction between ownership, possession and control of property is based
largely upon the absence or presence of actual physical control of the property, and is

35
therefore restricted to property which can be controlled physically, namely corporeal
things.

Physical control of corporeal things is either lawful or unlawful, depending upon the
question whether or not it was established and is exercised in accordance with the
relevant legal principles.

If control is lawful the law will attach the normal consequences and protection
associated with the particular form of control to it, regardless of the mental attitude of
the controller.

If control is unlawful the law will neither recognise nor protect it, but it might still
attach certain consequences to it in order to protect peace and public order. The
consequences of unlawful control might be influenced by the good or bad faith of the
controller.

Lawful control is either ownership or lawful holdership, the latter being lawful control
of property belonging to somebody else.

Unlawful control is either possession or unlawful holdership, and both of these can be
in either good or bad faith, depending upon the controller’s awareness of the fact that
the control is unlawful. Unlawful possession is exercised with the mental attitude of
being the owner, while unlawful holdership is exercised with the mental attitude of not
being the owner, but still having a right to control the property.

Ownership, possession and holdership are all forms of control of corporeal things.
They are distinguished on the basis of the lawfulness of the control and the
controller’s mental attitude. The controller’s mental attitude refers firstly to the
question whether the controller is acting as owner or as a controller of property which
belongs to someone else, and secondly, only in cases of unlawful control, to the
question whether or not the controller is aware of the unlawfulness of the control.

CHAPTER 13
The distinction between various forms of control is mainly concerned with control of
corporeal things, and is therefore not applicable to incorporeal property, which cannot
be controlled physically in any sense.
Ownership, possession and holdership are all forms of control over corporeal things.
They are, therefore, all based upon an element of physical control, and the distinction
between them is determined by the mental attitude with which this control is
exercised.
The literal or narrow interpretation which restricts physical control of corporeal things
to actual, physical holding of an object is too narrow to be workable in a complex
social and commercial environment.

36
The literal interpretation of the corporeal aspect of control is extended and made more
functional by way of considerations or indicators, usually deriving from commercial
practice, which might indicate a specific interpretation or application of the corporeal
element in a specific case.
The mental element of physical control is a factual matter which distinguishes
between possession and holdership. A controller’s mental intention towards control of
corporeal property must be conscious, and it assumes the form of either the owner’s
intention or the intention to hold someone else’s property for one’s own benefit.
The distinction between the original and derivative acquisition of rights also applies to
possession and holdership, even if this application is limited. In principle these forms
of control can, therefore, be established either originally or transferred from one
person to another.
CHAPTER 14
The protection of possession and holdership is concerned with remedies which can be
used to protect property rights or to control the effects of unlawful actions against
other property relations.
Remedies for the protection of possession and holdership are sometimes aimed at the
protection of property rights, and then they require proof of such a right. At other
times these remedies are aimed at preventing and discouraging unlawful self-help with
regard to property relations, and then they do not require proof of a right; for the sake
of peace and order even unlawful property relations are protected against self-help.
- A declaratory order is a court order, based upon proof of an actual
dispute about rights, in which the rights and obligations of the parties
are set out by the court in order to prevent infringements.
- An interdict is a summary court order, based upon proof of a right and
ongoing or imminent infringement, in which the court orders one party
to stop or refrain from such infringement.
- The spoliation remedy is a summary remedy granted upon urgent
application in order to summarily restore control which has been
spoliated unlawfully, without investigating the merits of the parties’
rights to the property.
- The possessory action is an action, based upon a stronger right to the
property in question, with which the plaintiff can claim either the return
of the property or its value, as well as additional damages, from any
defendant with a weaker right who was responsible for the unlawful
removal of the property from the plaintiff’s control.
- The claim for delictual damages is an action, based upon a patrimonial
interest in property, for damages in compensation for loss caused by an
unlawful and culpable action of the defendant.
- The condictio furtiva is a delictual action used by the owner or a lawful
holder of property that was stolen and subsequently lost or destroyed, to
claim the highest value of the property since the theft from the thief or
her heirs.

37
 - The extended enrichment action is based upon the principle that
unjustified enrichment should be compensated, and allows the plaintiff
to recover compensation from an owner who was enriched when her
property was improved without just cause by the plaintiff.
- Rights in property, including all forms of lawful control of corporeal
things, are guaranteed against unlawful state interference by section 25
of the Constitution.
- Land reform is a process by which new land rights are created and
existing land rights improved in order to rectify the imbalance in land
distribution and access to land.
NB** CHAPTER 16 – LIMITED REAL RIGHTS AND OTHER RIGHTS IN
PROPERTY
1. REAL RIGHTS OF PROPERTY
Rights of property include all rights, claims and interests with regard to
property both corporeal and incorporeal, that form part of a persons’ wealth or
estate and are recognised and protected either by private law or by the
constitutional property guarantee in section 25 of the Constitution.
1.1 Limited real rights
forms a special and important category of rights in property. They are
distinguished from creditors rights on the one hand because they are real rights,
meaning that they create direct entitlements towards a thing, and that they are
enforced against any owner of the thing and not just against a specific debtor.
On the other hand, they are distinguished from ownership because ownership is
a real right with regard to one’s own property whereas limited real rights are
real rights with regard to property that belongs to somebody else.

1.2 Other rights in property

- Creditors rights
- Rights that do not amount to ownership, e.g. share blocks schemes and
some club and retirement schemes.

1.3 Customary Law Rights in Property

this is rights in property cannot really be described as real rights or as
ownership or as limited real rights because their nature and function are so
uniquely tied in with the social structure which underlies customary
relationships. They are rights in property, but they are unlike any of the other
rights in property.

NB** CHAPTER 17 – SERVITUDES AND RESTRICTIVE CONDITIONS

1. Servitudes
- is a limited real right to the movable or immovable property of another
person (owner), which grants the entitled person (holder of servitude)
certain specific entitlements (usually the entitlements of use and

38
 enjoyment), and these entitlements limit the entitlements of the owner in
respect of the thing in one way or another.
A requirement for the establishment of servitudes in respect of immovable
property (praedial and personal), is that the servitude must be registered against
the deed of transfer of the burdened property. It can be included as a condition in
the deed of transfer of the burdened property or registered by means of a notarial
deed and this notarial deed is then endorsed against the deed of transfer.
However, on the basis of an unregistered servitutal agreement only creditor’s
rights between the parties are created. Other ways of establishing servitudes are
prescription, expropriation and court order (way of necessity). In the case of
movable property the thing must usually be delivered to the holder of the
servitude to enable her to exercise the entitlements arising from the servitude.
1.1 Characteristics of servitudes
(a) The holder acquires a limited real right in the property of another
legal subject, which he can protect and enforce with a real
remedy (action confessoria). The servitude is enforceable against
the owner of the property and all his successors in title.
(b) The holder cannot expect the owner of the property to do
anything positively as a result of the servitude. The servitude
grants only entitlements of use and enjoyment to the holder of the
servitude which must be respected and tolerated by the owner.
(c) No person can acquire a servitude over his own property
(d) The holder may not transfer the servitude to another person –
Lorentz v Melle 1978.
(e) the entitlements must be exercised reasonably by the holder of
the servitude.

1.2 Categories of servitudes

(a) Praedial servitudes
is a limited real right in the land of someone else (the servient
tenement) which grants the holder of the servitude certain
entitlements of use and enjoyment in his capacity as owner of the
dominant tenement.
(aa) Characteristics of praedial servitudes
(a) It can be granted only in respect of immovable property (hence the term
praedial servitude).
(b) There are always two pieces of land involved, namely a dominant and a
servient tenement. The holder of the servitude is the owner of the dominant
tenement, and he exercises the entitlements of use and enjoyment resulting
from the servitude with regard to the servient tenement in his capacity as
owner of the dominant tenement. The owner of the servient tenement must
tolerate this exercise of entitlements by the holder of the servitude.
(c) The limited real right vests in the holder of the servitude in his capacity as
owner of thedominant tenement (and not in his personal capacity). This

39
 means that the successors in title of the owner of the dominant tenement are
automatically entitled to the servitude – the servitude ‘runs with the land’.
A servitude is not transferable in the sense that it is transferred from one
person to another.
(d) The burden on the servient tenement is transferred automatically to the new
owner (in his capacity as owner) when the land is transferred. It is therefore
a burden on the property and enforceable against the owner of the servient
tenement and all his successors in title.
(e) In principle praedial servitudes are perpetual, but in terms of section 76(1)b
is of the Deeds Registries Act 47 of 1937 it can be made subject to a
resolutive condition or term.
(f) The dominant and servient tenements must be located next to or near each
other.
(g) A benefit which increases the value and usefulness of the dominant
tenement must vest in the owner of the dominant tenement and his
successors in title. In principle, this must hold a perpetual benefit for the
dominant tenement. This is called the utilitas requirement. In De Kock v
Hänel 1999 (C) it was decided that a praedial servitude must offer a
permanent benefit to the dominant tenement and not merely serve the
personal pleasure or caprice of the owner of the land.
(h) In principle servitudes are indivisible. The only exception is in the case of
subdivision of the servient tenement which can lead to partial liberation
since not all parts of the servient tenement normally serve the dominant
tenement, or not all parts of the dominant tenement normally derive benefit
from the servitude.
(i) The entitlements of the servitude holder can never be such that the owner of
the servient tenement is compelled to perform a positive act. There can only
be an obligation on the owner of the servient tenement to tolerate the holder
of the servitude’s entitlements (positive servitude) or to allow a certain
situation on the servient tenement to continue for the benefit of the holder
of the servitude (negative servitude).
(j) It usually comes into being by registration in the deeds registry as a
conditional clause in the title deed of the servient tenement. It can also be
created by means of a notarial deed registered in the deeds registry and by
making an endorsement against the title deed of the servient tenement (for
exceptions to the requirement of registration.

Categories of Praedial servitudes

(a) rural praedial servitudes; i.e. right to fetch wood, right to grazing
ect.
(b) (b) urban praedial servitudes; building on servient tenement, right
to encroach on the boundary of two tenements; right to electrical
and pipes installed.
(c) (c) statutory praedial servitudes, right to dam, drain, store and
lead water in terms of relative legislation, right to extend scheme.

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Personal servitudes
- is a limited right to the movable and immovable property of someone
else which grants entitlements (use and enjoyment rights) in respect of
the thing to the servitude holder.

Characteristics
(a) accrues to the holder of the right in her personal capacity, but it is a limited
real right it must meet the requirements for the creation and exercise of
limited real rights.
(b) since the servitude accrues, it cannot be transferred
(c) although it vest in the holder in her personal capacity and its not
transferrable, it is not a creditors right but a limited real right
Categories
(a) common law personal servitudes (usufruct, use, habitation)
(b) servitudes which resembles real servitudes but which vests in the
holder of the right in his personal capacity
(c) Statutory personal servitudes

Common Law personal servitudes

Usufruct – is a personal servitude which, as a limited legal right, grants
the holder of the right to use someone else’s property (including fruits)
and to return the thing substantially intact to the owner upon termination
of the usufruct.
Requirements
- usufruct can be granted in respect of movables or immovables or a
combination of both
- it can be granted in respect of both non-consumables and consumables.
In the latter case which is known as a quasi-usufruct, ownership of
consumables vests in the usufructuary together with the obligation to
return the property of equal quantity and quality to the owner upon
termination
- it can be granted in respect of renewable resources
- it can be granted in respect of corporeal things

Use
is a limited real right in terms of which the holder of the right acquires entitlements to
use the property for the benefit of himself and his household while keeping it
substantially intact.
 Use is a more limited right than usufruct. The entitlements of the use right may
not be exercised by anyone else than the holder of the servitude.
 The user is entitled to collect as much fruit as is necessary for his and his
household’s daily consumption. Fruits may not be sold or given to third parties.
 The thing must be returned to the owner substantially intact on termination of
the use right.

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  Use may be granted in respect of movables (for instance farming implements)
or immovables (for instance a sectional title unit).
 In National Stadium South Africa (Pty) Ltd v Firstrand Bank Ltd 2011 (SCA) it
was held that the use of a name for a stadium can be registered as a personal
servitude.

Habitation
is a limited real right in terms of which the holder of the right is entitled to occupy a
home belonging to the owner while leaving it substantially intact.
 unlike usufruct and use the holder of the right is not entitled to fruits
 The holder of the right may allow third parties to exercise certain entitlements
resulting from the right to occupation in terms of the agreement, but the
personal servitude is not transferable

Servitudes which resembles praedial servitudes;

A right which resembles a praedial servitude can in fact be a personal servitude if the
right can be exercised only by the holder of the servitude in his personal capacity. It is
still a limited real right since it can be enforced against the owner and all his
successors in title, but it vests in the holder of the servitude in his personal capacity
and not in his capacity as owner of a dominant tenement.

(c) Statutory personal servitudes

Examples of statutory personal servitudes are:
(aa) A right to install electrical cables over land – section 19 of the Electricity Act 41
of 1987.
(bb) A right to extend in terms of section 25 of the Sectional Titles Act 95 of 1986.
Although this right vests in a particular servitude holder, it is transferable, unlike other
personal servitudes.

INTERPRETATION OF SERVITUDES
It is sometimes difficult to establish whether a servitude agreement or will creates a
praedial or a personal servitude. It is therefore important that a servitude agreement or
will should be drafted in language which makes the parties’ intention clear.

(a) The general rule is that servitudes should be interpreted restrictively – The
onus of proof is on the person alleging that a servitude exists to prove it on
a balance of probabilities, since there is a rebuttable presumption that
ownership is unencumbered.
(b) In terms of the rules of interpretation, words are given their ordinary,
grammatical meaning.
(c) If there is doubt as to the nature of the agreement between the parties, that is
whether they intended to create creditor’s rights (personal rights) only
between the parties or whether they intended to create a servitude after
registration, the rebuttable presumption that they intended to create a
personal right (the least encumbering interpretation) applies.

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 (d) In the case where there is doubt whether a praedial or a personal servitude
was created, the rebuttable presumption that a personal servitude was
created (the least encumbering interpretation) applies.
(e) The least encumbering interpretation is followed only where there is
uncertainty.

Criterion for reasonableness

The criterion of reasonableness in the exercise of servitude entitlements means that the
holder must exercise their rights within reasonable bounds, while the owner must
tolerate it. This principle is based on the reasonable man's actions, as in neighbour
law.
- The owner is entitled to use their land normally, provided this is not in
conflict with the entitlements of the holder of servitude
- The holder of servitude is entitled to exercise his or her entitlements
within reasonable bounds (civiliter modo), However, if there is conflict
of interest, the interest of the holder will have precedence over that of
the owner, subject to the criterion for reasonableness
- Where there is no uncertainty in the wording of a servitude regarding the
exercise of specific rights of use and enjoyment, such rights will not be
in contradiction with the civiliter modo.

ACQUISITION OF SERVITUDES
(a) Registration of praedial and personal servitudes in respect of immovable
property in terms of the Deeds Registries Act 47 of 1937.

(b) Delivery in the case of personal servitudes in respect of movables

- Personal servitude in movable property requires the property to be made
available for the holder to exercise their entitlements, with the owner
always maintaining their intention to be owner. An oral agreement is not
required for establishing the personal servitude, as long as the property
is made available for the holder to exercise their entitlements.

(c) Statutory establishment.

- Prescription - Section 2(1) of the Prescription Act 18 of 1943 and
section 6 of the Prescription Act 68 of 1969 allow for the establishment
of praedial or personal servitude through prescription.
- Expropriation – Section 25 of the Constitution and sections 4 and 5 of
the Expropriation Act 63 of 1975 allow for the creation of servitudes
through expropriation, with the same requirements
- Other legislation - The South African government has implemented
various legislation to establish servitudes, including the National Water
Act 36 of 1998, Sectional Titles Act 95 of 1986, Electricity Act 41 of
1987, and the Legal Succession to the South African Transport Services
Act 9 of 1989.

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 (d) Creation by court order
A servitude created by prescription can be enforced through a court order,
and a person who neglects to register a servitude can be compelled to do so.
Courts can change the route of a fixed-route servitude of right of way, even
against the owner's will, if circumstances justify it. Landowners without
access to a public road can also apply for a court order to grant a way of
necessity.

The way of necessity – a landowner who has no or insufficient access to a public road
can acquire a way of necessity over the neighbouring land to the nearest public road
by means of a court order.
(a) Claim to way of necessity
- Landowners of landlocked land have the right to access the nearest
public road over their neighbour’s land, regardless of whether the need
for access is recent or long-standing, and this applies to land without
public roads or unsatisfactory alternative routes.
(b) The nature of way of necessity
- The court can order the use of a way of necessity in emergency
situations or continuous basis, depending on the circumstances.
However, due to modern farming methods, it is unlikely that a route will
be used solely in emergencies.
(c) Determination of land over which way of necessity runs
- The principle dictates that the most efficient route, minimizing damage
or burden to landowners, should be indicated as the way of necessity.
(d) Determination of route and width of way of necessity
- The principle in land determination is to follow the route that minimizes
damage to the landowner, considering both interests. The court will not
allow a way of necessity if an alternative route is inconvenient for
farming purposes, as it would be unreasonable detriment to the
landowner. Both landowners' interests must be considered when
determining the road's width.
(e) Compensation
- Compensation is typically not payable in cases of ius viae precario , but
must be paid in cases of ius viae plenum.

(f) Registration
- Registration is not required for the real effect of a way of necessity that
is created by court order. It is, however, recommended to ensure legal
certainty.
(g) Changed conditions
- The route of the servitude road can be changed by an order of court
without the agreement of the parties due to changed conditions:

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REMEDIES
The following remedies are available to the holder of a servitude.
 The actio confessoria is a real remedy by means of which the holder of a
servitude can prohibit any limitation or impediment to the reasonable exercise
of his entitlements by means of a court order. Compensation for damages can
also be claimed with this action.
 An interdict
 A declaratory order
 A spoliation order to effect restoration of control
 A delictual claim for damages

The owner of the encumbered property has the following remedies available:
 The actio negatoria is an action against the holder of the servitude who
exceeds his entitlements or any other person who wrongfully claims
entitlements in terms of a servitude.
 An interdict
 A declaratory order
 A delictual claim for damages

TERMINATION OF SERVITUDES
(a) Fulfilment of condition or term
- Praedial and personal servitudes are granted subject to a condition or
period, and are terminated if the condition is met or the period ends.
Personal servitudes lapse at death, dissolution, or after 100 years for
natural persons.
(b) Merger
- The principle states that a person cannot have a servitude over their own
property, as the holder of the servitude becomes the owner of the
encumbered property, such as a right to aqueduct over a farm.
(c) Abandonment
- A servitude holder can either explicitly or implicitly abandon it in favor
of the owner. Implicit abandonment occurs when the holder allows the
owner or third party to act in a way that makes it impossible to exercise
the servitude and does not take steps to protect it. If the servitude is
registered over immovable property, cancellation in the deeds registry is
required for legal certainty, typically through a notarial deed.
(d) Impossibility
- The servitude of a non-consumable encumbered thing is terminated if it
is destroyed or changes in nature, making it impossible to exercise the
rights. In the case of consumables with a quasi-servitude, the servitude
is not terminated by the destruction of the thing, but the holder is still
obligated to return the same quality and quantity upon termination. In
immovable property, the servitude lapses if the benefit for the dominant
tenement is permanently terminated.
(e) Prescription
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 - Section 7 of the Prescription Act 68 of 1969 states that a servitude can
be extinctive if it is not exercised for 30 years. Positive servitudes lapse
if the holder doesn't exercise them, while negative servitudes lapse if the
owner acts contrary to them. The prescription must be proven by the
servient tenement owner. If a servitude holder refrains from exercising
some entitlements, it doesn't lapse through prescription.
(f) Expropriation
- A servitude can be terminated through expropriation, as per section 25
of the Constitution and the Expropriation Act 63 of 1975, or other
relevant legislation.

RESTRICTIVE CONDITIONS
- Registered against urban and rural land (wider sense)
- Registered against the stands in a specific township by the original
township owner or developer at the time of establishment (narrow
sense)
- Made applicable to urban and rural land by statute without registration
which limit the entitlements of the owner of such land. (statutory
restrictions)

Personal restrictive conditions – where the benefit derived from the restrictive
condition vests in the person in his personal capacity.
Real restrictive conditions – where the benefit vests in all the other owners of stands
in a township in their capacity as owners of stands.

Restrictive conditions are not servitudes. They are limited real rights registered
in the deeds registry during township establishment by the original owner against
all the stands or certain stands in a specific township area in favour of all the
owners or certain owners of stands in the same township area (real restrictive
conditions) or in favour of a specific person in his personal capacity (personal
restrictive conditions).

PUBLIC SERVITUDES
grants certain entitlements to the general public in respect of certain land which limits
the owners’ entitlements.

Public servitudes are established in one of the following ways:

- A reservation for the benefit of the public in the grant or alienation of
state land.
- The use of a road by the general public in terms of the National Road
Traffic Act 93 of 1996 and related provincial legislation.
- Registration of a notarial deed.
- Registration of a testamentary disposition in the deed of transfer from
the deceased estate to the heir.

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 - Immemorial use (vetustas), which indicates the exercise of the
entitlement in respect of land by the public for such a long time that
there is no knowledge of any other state of affairs

NB** CHAPTER 18 – REAL SECURITY; PLEDGE AND MORTGAGE

- A creditor who acquires a creditor’s right against a debtor has a claim
against the debtor in his personal capacity only. The basis of the
creditor’s right may be a contract between the creditor and debtor, or a
delict committed against the creditor, or the unjustified enrichment of
the debtor at the cost of the creditor. The amount owing by the debtor to
the creditor in terms of the creditor’s right is called the principal debt.
- To ensure that the debtor performs in terms of the creditor’s right (pays
the principal debt), the creditor can require that the debtor provide
security in respect of the performance due to the creditor.

18.1 Personal Security

- implies that a creditor on the basis of a performance due to him as a result of a
creditors’ right against a debtor (the principle debt) also acquires a creditors’ right
against another person as security for payment of the principle debt

Suretyship is a form of personal security where a third party agrees to fulfil the
debtor's principal debt obligation if the debtor fails to do so. This contract provides the
creditor with a creditor's right against the third party as security for the principal debt,
making surety a specialized aspect of contract law.

18.2 Real Security

The creditor acquires a limited real right in the property of the debtor as security for
the payment of the principle debt by the debtor to the creditor, until payment of the
principle debt. (on the basis of a creditors right against a debtor (principle debt), a
creditor acquires a limited real right in the property of the debtor as security for the
payment of the creditors right by the debtor)

It differs from personal security in that a creditor does not acquire a limited real right
in the property of the debtor in the case of personal security, but acquires only a
creditors’ right against a third party as security for the payment of the principle debt
by the debtor.

Requirements for real security

- the existence of a valid and enforceable principle debt
- The real security is accessory to the principle debt – it is terminated
automatically if the debt is paid in full

Categories of real security

(a) Pledge – A pledge is a legal agreement where a pledgor, a debtor or surety,
pledges their property as real security for the payment of a principal debt to a
47
 creditor, granting the pledgee a limited real right to the property until the
principal debt is fully paid.
The pledge object
- only movable property can be delivered as security by the pledger to the
pledgee
- In the case of corporeal movable property, a single object or a collection
of objects can be used as security, for instance a painting, a flock of
sheep or all the farming equipment of a farmer.
- Incorporeal movable property can also be used i.e. shares in a company,
insurance policies.
- the fruits of an object both hanging and separated fruits form part of the
object of pledge. If the right to the fruits is granted to the pledgee the
lieu of interest on the principle debt in terms of a pactum antichreseos,
the pledgee can consume and alienate the fruit
Delivery
- To establish and retain security in the form of a limited real right to the
pledgor's property, the object of a pledge must be delivered to the pledgee and
controlled by them. Recognised methods of delivery include real delivery
(traditio vera) and delivery with the short hand (traditio brevi manu).
Constitutum possessorium is not a recognized method of delivery, as it can
mislead other creditors. To overcome this, parties often represent the pledge as
a simulated contract of sale, which could cause injury to other creditors.

The pledgee must continuously exercise control over the property to retain his
limited real right. If the pledgee willingly loses control, his limited real right is
terminated. If the property is removed without the pledgee's permission and the
pledged property is returned with or without legal process, the pledgee can still
exercise his limited real right.

A contract of pledge without delivery of the object is not enough to establish a

pledge as a limited real right in respect of the property. If the property is
alienated bona fide to a third party after the contract but before delivery, the
creditor of the principal debt has no remedy against the third party.

Rights of the pledgee

- The pledgee obtains a limited real right to the pledge object as security
for the payment of the principal debt and interest by the pledgor. This
right exists as long as the pledgee controls the property and a part of the
principal debt remains unpaid.
- If the pledgor does not pay the principal debt as agreed, the pledgee,
after summons, judgment and the issuing of a warrant of execution by
the court, has a preferential claim to the proceeds of the pledge object at
the sale in execution. If the proceeds are not enough to cover the debt
and interest, the pledgee has a concurrent claim against the proceeds
from the other assets of the pledgor (debtor).

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 - If the pledgor’s estate is sequestrated, the pledgee has, in terms of
section 95 of the Insolvency Act 24 of 1936, a preferential claim to the
proceeds of the pledge object in terms of a judicial sale. If this is not
enough to cover the principal debt and interest, the pledgee has only a
concurrent claim against the remains of the pledgor’s (insolvent’s)
estate.
- The pledgee can institute an enrichment claim against the pledgor for all
necessary expenses for the conservation or maintenance of the object, as
well as for useful expenses that enhance the market value of the
property. If the principal debt is paid in full and the pledgee’s right is
terminated, the pledgee can exercise an enrichment lien in respect of the
property as security for payment of the enrichment claim. However, in
the case of luxurious expenses, the pledgee has no enrichment claim or
lien.
- The principle of prior in tempore, potior in iure (earlier in time, stronger
in law) is also applicable in the case of pledge. Any limited real right to
the property established later, is subject to the right of pledge of the
pledgee. If the pledge object is removed from the pledgee’s control
without his permission and pledged to another person, the first pledgee’s
right has preferential status if his physical control is re-established.

(b) Mortgage
- is registered in respect of the movable and immovable property of the
mortgagor (debtor or surety in terms of a valid principle debt), grants the
mortgagee (creditor in terms of a valid principle debt) a limited real
right to the movable or immovable property as object of security until
the principal debt has been paid in full.

(bb) THE OBJECT – Requirements

- The object of security in the case of movables is a single or a collection
of corporeal property in terms of section 1(1) of the Security by Means
of Movable Property Act 57 of 1993. This Act provides for the
registration of a notarial bond over defined and specified movables of
the debtor without the requirement that they be delivered to the creditor.
They can, for instance, be a single tractor, a flock of sheep or all the
farming equipment of a farmer, provided that they are defined and
specified in the mortgage bond in such a way that they are identifiable.
The object of security cannot, however, be the merchandise of a dealer
in general, which is not specified and defined.
- In the case of immovable property, a mortgage can be registered in
respect of corporeal and incorporeal property. Examples of incorporeal
immovable property that can be encumbered by a mortgage are mineral
rights, a registered long-term lease over immovable property and a right
of extension in terms of section 25 of the Sectional Titles Act 95 of 1986
- The fruits of a movable or immovable form part of the object of the
mortgage, except in the case where a right to fruits is granted to the

49
 mortgagee in terms of a pactum antichreseos. If the mortgagee is in
control of the property and gathers fruit, she must report to the owner
regarding the value of the gathered fruit. In the case of immovable
property all attachments by means of accessionform part of the object of
the mortgage.

Registration requirements
(a) The creditor acquires a limited real right to the object of the mortgage after
registration of the mortgage bond in the deeds registry.
(b) In the case of movables a notarial bond is registered and a limited real right
is established without delivery to the creditor
(c) Immovable property is mortgaged by means of a registered mortgage bond.
(d) A mortgage bond is a legal document that outlines the terms and conditions
of a mortgage agreement. It must include the names of the mortgagor and
mortgagee, as well as the description of the immovable property. The bond
also includes the principal debt, the reason for the debt, the amount owing,
the interest rate, and the payment term. If the mortgagee has the discretion
to raise the interest rate, this variation is valid and enforceable. Other
conditions of the mortgage contract, such as payment location, official
address, payment method, and default consequences, are also registered
under section 63(2) of the Deeds Registries Act 47 of 1937.
(e) The mortgage is noted in the mortgage register and endorsed on the deed of
transfer of the encumbered immovable property after the owner of the land
has signed it and it is attested to (signed) by the registrar of deeds. If the
mortgage is not endorsed on the deed of transfer after registration, the
mortgage is still valid and enforceable as a limited real right.
(f) An unregistered agreement to mortgage property does not grant the creditor
a limited real right to the property. However, if the property is alienated to a
third party who had real or constructive knowledge of the unregistered
agreement to mortgage property, such a third party is compelled, because of
the doctrine of notice, to co-operate in the registration of the mortgage,
although she was not a party to the principle debt

Functions of a mortgage bond

- it serves as confirmation of the real right of the creditor to the property
as security for payment of the principle debt.
- It serves as written acknowledgement of principle debt
- It serves as payment record regarding the conditions pertaining to the
interest payment, term and default of the principle debt

Categories of mortgages
A kustingsbrief is a mortgage in favour of a seller of land as security for the unpaid
balance of the purchase price or in favour of any other person or financial institution
who advanced the balance of the purchase price to the buyer (mortgagor).
- A kustingsbrjef is registered simultaneously with transfer of the property
to the buyer and is,in terms of the principle of prior in tempore, potior in

50
 iure, the strongest kind of mortgage as real security. Mortgages in
favour of financial institutions which advance money to the buyer in
respect of the balance of the purchase price are usually registered in the
form of kustingsbriewe.

Money lent and advanced is mortgage for money lent and advanced is registered as
security for money lent and advanced by the mortgagee (creditor) to the mortgagor
(debtor) for other purposes than the payment of the balance of the purchase price.
- The fact that the mortgage serves as security for money lent and
advanced must be mentioned as causa in the mortgage bond. The
amount of money lent and advanced must also be mentioned.

Covering bond is a mortgage registered as security for an amount that will be lent or
advanced to the mortgagor by the mortgagee in future or for future debts in general. It
serves as continuous covering security to the maximum amount mentioned in the
mortgage bond.

A covering bond is an exception to the requirement that a valid principal

debt must already exist before a mortgage can be registered as security.
In terms of section 51(1)(a) of the Deeds Registries Act 47 of 1937 the
following must be mentioned explicitly in the mortgage bond: that the
mortgage serves as security for future debt(s); the maximum amount of
the future debt for which the mortgage serves as security

A covering bond can be registered as either a mortgage bond in respect

of immovables or a notarial bond in respect of movables. It gives
security to the mortgagee from the date of registration (and not from the
date on which the principal debt came into being). However, the
mortgagee must prove that the principal debt indeed came into being
after the date of registration.

Surety bond - A surety bond is registered against the property of a surety of the
debtor, who undertakes to give security to the creditor for the payment of the principal
debt by the debtor. The surety bond is granted by the surety (mortgagor) over his
movable or immovable property in favour of the creditor (mortgagee). The causa of
the mortgage must be mentioned in the surety bond.

Participation bond - A participation bond is registered, in terms of the requirements

of the Collective Investment Schemes Control Act 45 of 2002, in favour of participants
in a collective investment scheme, in the name of a nominee company as mortgagee
over the immovable property of the mortgagor who was granted a loan by the nominee
company.

- Money acquired by a nominee company as investments from

participators in a collective investment scheme of the nominee company,
is lent by the nominee company to the debtors. A collective investment
51
 scheme in participation bonds is a scheme where the assets are held in
the form of participation bonds, and the participants to the investment
scheme acquire an interest in the scheme secured by participation bonds.
Without the participant’s name being included in the participation bond
the debt secured by the participation bond is owed to the participants of
the investment scheme and not the nominee company (section 57).
- In terms of section 56(1) of the Collective Investment Schemes Control
Act 45 of 2002 it must be mentioned explicitly in the mortgage bond that
it is a participation bond and that the nominee company acts as the
representative of the participants.

A notarial bond is registered against specific corporeal movable property of the

mortgagor (debtor in terms of the principal debt) as security for the payment of the
principal debt to the mortgagee (creditor in terms of the principal debt) and, after
registration, this grants the mortgagee a limited real right to the objects of the security
without these objects being delivered to the mortgagee.

- Section 1(1) of the Security by Means of Movable Property Act 57 of

1993 determines that a mortgagee in terms of a notarial bond obtains a
limited real right of security over the corporeal movable property of the
mortgagor if it is described in the mortgage bond in such a way that it
can be recognised. Without delivery the mortgagee obtains a security
right similar to pledge It is still possible to register a notarial bond over a
debtor’s incorporeal property (for instance share certificates, book debts
or liquor licences) or the debtor’s movable property in general, but this
will not provide the mortgagee with real security as provided for in the
Act. In this instance the bond must first be perfected by delivery of the
property to the mortgagee before the insolvency of the mortgagor.
- A notarial bond in terms of the Act provides the creditor (mortgagee)
with a limited real right over the defined movable property of the debtor
without the property being delivered to the creditor – section 1(1), (b)In
terms of section 2(1) the tacit hypothec of a landlord or a creditor does
not vest in respect of property that are security objects in terms of a
notarial bond.

Land bank mortgages serve as security for money advanced to farmers by the
land bank for agricultural purposes. Only agricultural land can serve as object of
security. requirements must be met in the case of a land bank mortgage:

- It can be registered only in respect of agricultural land.

- It has to be a first bond, except in the cases listed in (cc).
- The holders of existing bonds have to relinquish their preferent right,
with the exception of a mortgage in favour of the Republic of South
Africa as security for the balance of a purchase price owing to the state
for the purchase of state land or another land bank mortgage.

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 - The agricultural land must be usefully cultivated, except for land used
exclusively for grazing.
- The mortgagor must be the owner of the land. The only exception to this
is where the mortgagor is a tenant of state land in terms of a registered
long-term lease.

(c) Cession in securitatum debiti

is a special form of real security by means of incorporeal property, specifically
in the form of security rights to creditor’s rights. Two kinds are distinguished,
namely the pledging of creditor’s rights as security for a debt and general
security cession.
(a) The pledging of creditor’s rights as security for a debt
- A debtor (in terms of a principal debt) can pledge a creditor’s right
against a third party as security to the creditor (in terms of the principal
debt). The creditor’s right of the debtor is pledged to the creditor as
security for performance of the debtor to the creditor. The creditor’s
right is not ceded to the creditor. The debtor retains the ‘ownership’ of
his creditor’s right, but cannot dispose of it. Since creditor’s rights are
defined as incorporeal property
(b) General cession of security
- The debtor (in terms of the principal debt) can transfer or cede his
creditors’ rights against third parties to the creditor (in terms of the
principal debt) as security for the payment of the principal debt of the
debtor to the creditor in such a way that the creditor becomes the holder
of the right instead of the debtor on the basis of the contract of cession.
The creditor therefore acquires the right to enforce the debtor’s
creditor’s right against the third party for his (the creditor’s) own benefit
if the debtor does not perform. An example of this is the cession to the
creditor of a book debt due to the debtor. In this case
‘ownership’ (instead of pledge) of the creditor’s rights (as incorporeal
property) is transferred to the creditor for the purpose of security. This
form of security is therefore also regarded as real security.

Security granted by operation of law in respect of property of the debtor to the

creditor.
- Tacit hypothecs of the landlord and credit grantor
- Judicial pledge
- Statutory security rights
- Liens

Principles applying in respect of real security

(a) The real security is enforceable only against the property of the debtor as
long as the debtor owes the creditor an amount in terms of a valid principal
debt (creditor’s right). If the principal debt lapses or is paid in full, the real

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 security is terminated automatically. The real security is therefore accessory
to the principal debt.
(b) In terms of the real security the creditor obtains a limited real right to the
property of the debtor (the object of security) which is enforceable against
the debtor personally and all third parties. Therefore, a double legal
relationship exists: a creditor’s right of the creditor against the debtor as a
result of the principal debt between them; a limited real right of the creditor
to the movable or immovable property of the debtor as security for the
principal debt.
(c) If the debtor doesn’t settle the principal debt as agreed, the creditor has a
preferential claim to the proceeds if the property is sold in execution or
insolvency.
(d) The real security exists in respect of the principal debt and all interest,
except if otherwise agreed upon by the debtor and creditor.
(e) The creditor does not usually acquire any entitlements of use and enjoyment
in respect of the property, and may hold it only for the purpose of the
security. Movable property must be returned to the debtor if the principal
debt is paid. However, the parties may agree by means of a pactum
antichreseos that the creditor may enjoy the fruits of the encumbered
property in lieu of the interest on the principal debt.
(f) The property of the debtor is usually used as security for the principal debt,
but it is also possible to use the property of a surety as security in terms of a
contract or mortgage of surety

SUMMARY

Real security means that, on the basis of a creditor’s right against the debtor
(principal debt), a creditor acquires a limited real right in the property of the
debtor as security for the payment of the creditor’s right (principal debt) by the
debtor. Real security differs from personal security in that a creditor does not
acquire a limited real right in the property of the debtor in the case of personal
security, but acquires only a creditor’s right against a third party as security for
the payment of the principal debt by the debtor. Such a third party is normally a
surety of the debtor.

A requirement for real security is the existence of a valid and enforceable

principal debt. The real security is accessory to the principal debt; in other words
the real security is terminated automatically if the principal debt is paid in full.
If the object of security is movable property, real security can be in the form of
either pledge or notarial bond. In the case of pledge the object of pledge
(corporeal or incorporeal movable property) must be delivered by the pledgor
(debtor) to the pledgee (creditor). Physical control of the pledge object is a
requirement for the establishment and continuation of a limited real security right
to the security object. The pledgee has the obligation to maintain the pledged
property within reason and, on termination, to return the property to the pledgor.

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A notarial bond can be register ed in respect of specified, corporeal movable property
of the debtor (mortgagor) in favour of the creditor (mortgagee) in the deeds registry.

After registration of this bond, the mortgagee acquires a limited real right to the
encumbered property without delivery thereof to the mortgagee.
Immovable property of the debtor serves as object of security in that a
mortgage is granted by the debtor (mortgagor) to the creditor (mortgagee) and
registered in the deeds registry.

A mortgage is a liquid document which grants the mortgagee a limited real right in
respect of the immovable property of the mortgagee without the physical control of
the property being passed to the mortgagee. More than one mortgage can be registered
over the same immovable property at the same time. Priority is given, in this case, to
mortgagees in the order that the mortgages were registered (prior in tempore potior in
iure).

The pledgee or mortgagee (creditor) can, if the principal debt is not paid in full
by the mortgagor or pledgor (debtor), have the security object sold in execution
and is entitled to the proceeds of the sale in execution for payment of the principal
debt. In the case of insolvency of the pledgor or mortgagor, the pledgee or
mortgagee acquires a preferent claim to the proceeds of the sale of the security
object.

CHAPTER 19 – REAL SECURITY RIGHTS CREATED BY LAW

Real security rights are created by law when the law provides a security right to secure
a debt, in the absence of agreement.

The lessor’s tacit hypothec is created by operation of law as soon as rent is in arrears,
and is perfected by attachment. It covers all movables of the lessee on the premises
and allows the lessor to attach the property to secure payment of the rent in arrears. In
certain circumstances it can apply to movables of third parties on the premises as well.

The credit grantor’s tacit hypothec is created upon insolvency of the credit receiver,
and secures the credit grantor’s claim for outstanding payments. A judicial pledge or
mortgage is created by way of a writ of execution and attachment, and provides a real
security right to enforce an outstanding debt.

Statutory security rights of various kinds are created by statutes to secure specific
debts in the form of statutory mortgages, statutory liens, statutory fictitious pledges or
preferent claims.

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Liens are rights of retention which allow the controller of property to refuse to return
it to the owner unless the owner repays an outstanding principal debt to the controller.
Enrichment liens are enforceable as real burdens on the property, whereas debtor-
creditor liens are enforceable as personal obligations.

CHAPTER 20 – OTHER PROPERTY RIGHTS

Besides ownership and the limited real rights already discussed in earlier chapters,
there is a wide variety of other property rights that also deserve attention, even though
they might be less common or more specialised subjects.

The most important ones discussed here are the rights of landlord and tenant,
common-law
land rights and mineral rights. The lessee obtains a right to use the lease property as
described in the contract of lease. In the case of immovable property this right is
protected against new owners of the property by registration, the doctrine of notice
and the rule that an existing lease overrides a new sale.

Leasehold and quitrent are long-term limited real rights in land, and both offer
security of tenure, but in view of the use that was made of these rights during the
apartheid era they are associated with the kind of inferior land rights given to black
people during the era of apartheid land law.

Mineral rights are real rights of a unique kind which allow the holder to prospect for,
extract and remove minerals on the land in question within the confines of legislation
pertaining to mining and minerals. Ownership of the actual minerals is obtained only
upon extraction and separation from the land. The mineral rights holder must act
reasonably in exploiting the minerals, but in the case of
irreconcilable conflict the mineral rights take precedence over the rights of the
landowner. Since 1 May 2004 all rights to minerals are subject to strict state control.

CHAPTER 21
The South African Constitution is so important for the transformation of South
African society that its effect is not restricted to public law. It is seen as a constitution
which functions in public law, with important implications and effects in private law.

The most important features of the Constitution, as far as property law is concerned,
are the following: the Constitution is the supreme law; it is entrenched or rigid; it
contains a bill of rights; it is enforced by an independent judiciary; it acknowledges
the validity of common and customary law; it embodies important values and
principles; and it protects property. The Constitution strives towards
the transformation of South African society through the entrenchment and promotion
of specific constitutional values and principles. The most important principles are
national unity and reconciliation; limited government in an open democracy; the
creation of a just and open society based on freedom and equality; political and
cultural pluralism; and constitutionalism.
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The interpretation of the Constitution is determined by section 39: chapter 2 shall be
interpreted according to the values of the Constitution, that applicable international
law shall be taken into account when applying chapter 2, that comparable foreign law
may be taken into account, that laws which restrict the fundamental rights must be
interpreted more narrowly to bring them in line with
chapter 2, and that all existing laws, common law and customary law have to be
interpreted and applied with due regard for the spirit of chapter 2.

The limitation of constitutionally protected rights (including property) is controlled by

section 36 of the Constitution: no right is absolute, and any constitutional right may be
limited, provided such limitation satisfies the general requirement that it is reasonable
and justifiable, and any specific requirement that may be laid down in the
Constitution.

CHAPTER 22 – INTRODUCTION TO CONSTITUTIONAL PROPERTY LAW

The function of a property clause is to provide a guarantee for private property rights
against improper state interferences, while still leaving room for unavoidable and
proper interferences.

Section 25 of the Constitution provides a negative guarantee for property. This

concept will probably be interpreted and applied with regard to a very wide range of
property interests, which would be protected against improper state interferences.

Section 25(1) ensures that unavoidable state limitations of private property are
legitimate as long as they are not arbitrary and comply with proper legal procedures in
terms of general law. Section 25(2) provides that a certain category of legitimate state
interference with private property, which amounts to an actual acquisition by the state
or expropriation of the property, must not only comply
with the due process requirement but is also restricted to cases where it serves a public
purpose, and that it must be accompanied by payment of compensation in terms of
section 25(3).
CHAPTER 23 – REFORM OF PROPERTY LAW
The background for the land reform programme is the situation of inequality and
injustice caused by decades of apartheid land law. Apartheid land law was initiated by
the Land Acts of 1913 and 1936, and extended to both customary land holding in the
rural areas and residential landholding in the urban areas. It resulted in temporary or
insecure land rights, as well as the criminalisation of land use, which contrasts sharply
with the technical refinements and developments of western civil
law property rights.
The former De Klerk government introduced a number of land reforms in 1991, the
most important of which was the abolition of most of the apartheid land laws. The
1993 Constitution contained a special set of land reform provisions in sections 121 to
123. These sections provided the formal framework for a land restitution process,
which is controlled by the Restitution of Land Rights Act of 1994, promulgated

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specially for the purpose. The 1996 Constitution replaced the 1993 Constitution, and
now land reform, the protection of property and the right of access to housing are
governed by sections 25 and 26.

Land reform consists of three main pillars, namely restitution of land rights,
redistribution of land rights, and improving security of a wide range of tenure forms.
The 1996 Constitution provides the final framework within which the protection of
property rights and land reform initiatives are combined.
CHAPTER 24 – THE FUTURE OF PROPERTY LAW
The Constitution forms the background against which the new South African property
law has to develop. The values and spirit of the Constitution indicate how society and
property relations have to be transformed to reflect the new relationship between
property holders individually and between individual property holders and society.
This relation is described in terms of co-operation and accommodation rather than
conflict.

The old common-law methodology based upon abstract concepts and the protection of
individual rights has to be replaced by a new methodology which assumes a more
suitable attitude towards the relationship between individuals and society, and which
takes note of individual circumstances and surrounding facts when finding the proper
balance between property interests.

CASE LAW
EX PARTE GELDENHUYS – SUBSTRACTION OF DOMINIUM
In a mutual will a husband and wife left a piece of land to their children in undivided
shares (co-ownership). The will determined that the surviving spouse should, upon the
eldest child reaching majority, cause the land to be divided amongst the children in
equal portions by drawing of lots. The child who drew the portion upon which the
homestead was built should compensate the other children by paying an amount of
money to each of them. The registrar of deeds refused to register the conditions
imposed by the will, arguing that they were not concerned with real rights in land.

FNB v COMMISSIONER, SARS – DEPRIVATION OF PROPERTY

The FNB case involved section 114 of the Customs and Excise Act 91 of 1964, which
allowed SARS to detain and sell property in the possession of tax and duties debtors.
The constitutional court ruled that the act could not legitimately allow SARS to
deprive a property owner, FNB, of its property. The court noted that there was no
nexus between the property owner and the customs debtor, and the detention and sale
of the property were unrelated to the tax debt. The court deemed the effect of section
114 of the Act in FNB as an arbitrary deprivation of FNB's property, thereby declaring
it unconstitutional and invalid.

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GRANT v STONE STREET 1968 – THE DOCTRINE OF NOTICE
The doctrine of notice is applicable in contracts involving rights of aqueduct, which
were created in 1865 through an agreement between farm owners. The unregistered
servitutal agreement was enforceable between the contracting parties, but the
successor in title of farm B had no knowledge of the agreement. The court ruled that
the agreement was enforceable against the successor, as the previous owner had no
knowledge of it. The doctrine of notice is applicable only if contracting parties intend
to bind their successors in title.
INFO PLUS v SHEELKE 1998 3 SA 184 – Installment sale transactions and
transfer of ownership to the credit purchaser
Delivery in the case of some credit agreements in terms of the National Credit Act 34
of 2005 where ownership was retained by the credit seller is delivery with the short
hand on payment of the last instalment although physical control was transferred to
the buyer on conclusion of the contract. It is not necessary to conclude a new real
agreement to transfer ownership, but the initial real agreement is subject to the
condition that ownership will pass to the purchaser only once the final instalment has
been paid.

MACDONALD v RADIN 1915 (ACCESSION OF MOVABLES AND

IMMOVABLE THINGS)
three criteria were taken into consideration to determine whether a movable thing had
been attached to the land in such a way as to be a permanent part of the land and thus
the property of the landowner.
(a) Nature and purpose of the attached thing (objective)
(b) Manner and degree of attachment (objective)
(c) (Intention of the annexor (subjective)

MAPENDUKA v ASHINTON 1919 PROHIBITION OF PANCTUM

COMMISSORIUM
In Roman law the prohibition against the pactum commissorium in the case of pledge,
i.e. a provision that, upon non-payment of the loan secured by pledge, the creditor
could cancel the agreement and retain the property pledged as his own. "Since among
other objections to the lex commissoria in the case of pledges, there is its increasing
harshness, we declare it invalid, and wipe out all memory of it in future. If any person,
therefore, is subject to such an agreement, he shall find relief in this decree which
rejects such existing contracts, and prohibits them in future. For we decree that
creditors shall give up the thing pledged and recover what they have given
NINO BONINO v DE LANGE 1906 – Requirements for spoliation order
Many businesses attempt to evade the remedy by inducing their clients to sign a
contract in terms of which the client agrees that the business can repossess
property from the client without legal procedure if the client should fail to pay on

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time. In court decisions such as Nino Bonino v De Lange 1906 (T) it was stated
clearly that these contracts are against public policy and therefore void.
(a) Proof that the applicant was in peaceful and undisturbed control of the
property.
(b) Proof that the respondent took or destroyed that control by means of
unlawful self-help or spoliation.

TELKOM SA v XSINET 2002 SPOLIATION REMEDY WHERE QUASI

CONTROL WAS AT STAKE
Telkom provides Xsinet with a telephone and bandwidth system for business, also set
up their
system. Telkom claims Xsinet owes them money and subsequently disconnected their
services,
which results in Xsinet using the Mandament van Spolie as a defence
Telkom provides Xsinet with a telephone and bandwidth system for business, also set
up their system. Telkom claims Xsinet owes them money and subsequently
disconnected their services, which results in Xsinet using the Mandament van Spolie
as a defence.

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