Registrability of Rights in the Deeds Registry: The Twofold Test Revisited

• Jurisdiction: South Africa
• Date: 16 August 2019
• Author: P J Badenhorst
• Published date: 16 August 2019
• Pages: 220-236

220

REGISTRABILITY OF RIGHTS IN THE DEEDS

REGISTRY: THE TWOFOLD TEST REVISITED*

PJ Badenhorst

BLC LLB (Pretoria) LLM (Wits) LLM (Yale) LLD (Pretoria)

Associate Professor, Deakin University

Visiting Professor, Nelson Mandela University

1 Introduction

The registrabilit y of rights in the deeds regi stry by the Registr ar of Deeds1

in terms of the Deed s Registries Act 47 of 1937 (“Deeds Registries Act”)

is determine d by the nature of the right. Real r ights in respect of land ar e

registr able.2 Personal rights may, subject to a few exceptions,3 not be

registered.4 As there is no closed list of real rights (numerus clausus) in South

African law, new categories of real rights ca n develop.5 The Deeds Registr ies

Act does not properly dene or distinguish bet ween real and personal r ights.

A real right is d ened in a ci rcular fashion as “including any right which

becomes a real right upon regi stration”.6 Thi s denition is, however, of no

assistance in deter mining whet her a right is real or not.7 Personal rights are

not dene d in the Deeds Regist ries Act,8 but can, with reference to sect ion

63(1) of the Deeds Registries Act (which prohibits the reg istration of personal

rights) be referred to as a right which doe s not restrict the ownership of land.9

In terms of the doct rine of rights, real r ights and personal r ights can simply

be distinguishe d from one another with reference t o their respective legal

* This art icle is dedicated to Pr of JD van der Vyver of Emor y University

1 Such registr ation is not an admi nistrative decisio n but a clerical act See, Ned bank Ltd v Mendelow 201 3

6 SA 130 (SCA) para 25

2 S 3(1) of the Deeds Registr ies Act 47 of 1937; Cape Explosive Works Ltd v De nel (Pty) Ltd 2001 3 SA 569

(SCA) para 12

3 The proviso to s 63(1) and s 63(2) of t he Deed Regist ries Act See further PJ Badenhorst, J M Pienaar &

H Mostert Silb erberg and Schoe man’s The Law of Propert y 5 ed (2006) 66-69

4 S 63(1) of the Deeds Registr ies Act

5 See s 3(1)(r) of the Deeds Registr ies Act; Badenhors t et al Property 48

6 Definiti on of a “real right” in s 102 of the De eds Registries Act Th is definition can b e attributed to th e

notion of a ius in per sonam ad rem acquiren dam which gives rise to a rig ht to claim transfer of a th ing

(See furth er the text to part 4 b elow)

7 Badenhors t et al Property 50

8 Odendaals rus Gold, General Inve stments and Extensio ns Ltd v Registrar of Deed s 1953 1 SA 600 (O)

602 F

9 PJ Badenhorst “ New Real Rights to land in S outh Africa: A Twofold test” (2015) 4 Prop L Rev 197 198

This crite rion of restriction of a r ight is perceived as an ap proval by the legislatur e of the application of

the subtra ction from the dominium test by th e courts; see, Pearl y Beach Trust v Registra r of Deeds 1990

(4) SA 614 (C) 615G-H

(2018) 29 Stell LR 220

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objects:10 Real rights have as their object a t hing (res).11 Personal rights have

as their object perform ance by another person.12 The dist inction between the

two types of right s may be more complex and various theoretical tests, such as

the classical theory and the p ersonalist theory13 have over time been developed

to draw a distinct ion between real and personal rights.14 In pra ctice, two tests,

namely the subtraction f rom the dominium test and the intention te st have

been developed and are used by the cou rts as a priori criterion to deter mine

whether a right is real and, t herefore registrable in the deed s registry.15

As w ill be i ndicated, the rst test focuses on the impact of the right under

investigation upon ownership, whils t the second test focuses on the i ntention

of the parties regardi ng the nature of the right when it was created. Bec ause of

their formulation by the cou rts,16 these tests evolved into a so- called twofold

test containing element s of both tests.

Real rights to land are t raditionally divided i nto ownership (iura in re

propria) of land or limited real rights of another pe rson (iura in re aliena)

10 The following old sc hool approach of Harm s DP in National Stadi um South Africa (P ty) Ltd v FirstRand

Bank Ltd 2011 2 SA 157 (SCA) para 13 is to be welc omed:

“It is not necessa ry to get embroiled in a di scussion about the natu re of rights accordin g to Bentham

or Hohfeld and the li ke, or (for those who are not affe cted by cultura l cringe) according t o WA Joubert

cum suis It is also n ot necessary to delve i nto the history of r eal rights, to reco nceptualise ow nership,

or (as the court be low did) to ‘dephysicalise’ proper ty law … I nstead, it should suff ice to deal with

some elementar y propositions st ill taught, I hope , at law schools ”

Unfortun ately, Harms DP does not keep t he object of a right in mind whe n he incorrectly in dicates that

a personal r ight “matures into a re al right on registratio n” (para 31) A per sonal right to claim tr ansfer

is termi nated upon regi stration of a rig ht (capable of being a real r ight) Upon registration of such a

right a real rig ht is created with a thi ng as its object A personal rig ht does not change into a real r ight

upon regist ration MD Tuba “The lega l status of regist ered home owners’ as sociation condit ions - Willow

Waters Homeowner s Association (Pt y) Ltd v Koka (499/2013) [2014] ZASCA 221” (2016) 79 THRHR 339

341 also erred in t his regard by stating: “T his means that a person al right, upon registr ation, becomes

real and bind s the owner and his or her s uccessors in title” A pers onal right, even if reg istered, does not

bind success ors in title of ownership of l and In eThekwini Mun icipality v Mountha ven (Pty) Ltd 2018 1

SA 384 (SCA) pa ra 15, Tsiqi JA deci ded that a right to re-transfer property is a per sonal right which is

relative in its op eration as it is only enfor ceable against the tr ansferee “or its succes sors in title” As the

successors i n title are not parties t o the agreement betwee n the original tran sferor and transferee , such

personal r ight would not be enforceable ag ainst third par ties, namely, successor s in title Enforceabilit y

against suc cessors in title is a un ique feature of a real r ight which feature i s different from th e operation

of a personal rig ht The essence of a rea l right is thus not always a ppreciated

11 National S tadium South Af rica (Pty) Ltd v Fi rstrand Bank Lt d 2011 2 SA 157 (SCA) para 13 It is con ceded

that in prac tice real rights or pers onal rights may at time s serve as the object of anothe r real right See

furthe r Badenhorst et al Property 15-16; CG van der Mer we “Things”’ in WA Joubert & JA Faris (eds)

Law of South Af rica 27 2 ed (2014) para 17

12 National Sta dium South Africa ( Pty) Ltd v Firstrand Ban k Ltd 2011 2 SA 157 (SCA) para 13; Absa Bank

v Keet 2015 (4) SA 474 (SCA) para 23 It is no ted that the (incor rect) view is at times held, n amely that a

personal r ight can also per tain to a thin g, which complicates t he distinct ion between the said r ights If the

stated test i n terms of the do ctrine of righ ts, which focusse s on the object of a right to d istinguis h between

rights, is howeve r, kept in mind, such er roneous view can b e avoided

13 As to a discus sion of these two tests a nd other tests and t heir weaknesse s, see furth er CG van der Merwe

Sakereg 2 e d (1989) 60-63 Badenhorst et al Property 50-55 57; JC Sonneku s & JL Neels Sakereg

Vonnisbundel 2 ed (1994) 89-100; JC Sonnekus “Gebr ek aan wetenskap vervla k regspraak tot kasuïs tiek -

Willow Waters Homeown ers Associat ion (Pty) Ltd v Koka (76 8/13) 2014 Z ASCA 22 0 (12-12-2 014)” (2015)

TSAR 405 407-408

14 Badenhorst (2015) Prop L Rev 197

15 198

16 The formul ation of the twofold test can be cre dited to CG van der Merwe (see Van der Me rwe Sakereg

70), which formulati on was approved in Erlax Pro perties (Pty) Ltd v Reg istrar of Deeds 1992 1 SA 879

(A) 885B) As to earlie r formulatio ns of the test by the cou rts, see PJ Badenho rst & PPJ Coetser “T he

subtract ion from the dominiu m test revisited – Pea rly Beach Trust v Registr ar of Deeds” (1991) De Jure

375 380-383

REGISTRABILITY OF RIGHTS IN THE DEEDS REGISTRY 221

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