LU 1 - Introduction, Terminology and Basic Concepts

Law of Property
LAPR7312
Semester 1 of 2023
1
You may use the power point slides as a guideline to prepare content for
tests, assessments and the examination
HOWEVER, THE CONTENT TO THE POWER POINT SLIDES IS

INSUFFICIENT TO SUCSESSFULLY COMPLETE THIS MODULE
It is your responsibility to build onto slides from the prescribed

textbook, audios, additional study material, legislation and court cases.
No demarcations will be provided for any test, assessment or

examination, unless a brief has been provided with authority to share
with students.
2
Overview
 When you mention the term “property”, many people will automatically
think of a house or a plot of land. However, the concept of “property”
encompasses so much more than this.
 From large, immovable property like a farm to the smallest movable
property like the pencil that you use to write your lecture notes, the
term “property” is significantly further reaching than most people
realise.
 In this learning unit, we will look at:
 basic terminology in the law of property,
 categorisation of things and
 right relating to property law, and
 where property law can be found in the South African legal system.
3
Theme 1 - Introduction
Learning Units Prescribed material

 LUO1: Describe the sources Chapters 1, 2 and 3
of South African property law
 LUO2: Define the following
terminology:
a) person;
b) object;
c) property;
d) thing;
e) right;
f) property right / real right;
g) creditor’s right / personal
right
h) lawful;
i) remedy.
 LUO3: Discuss where property
law fits into the South African
legal system
4
LEARNING UNIT 1 1
INTRODUCTION, TERMINOLOGY, CLASSIFICATION AND REAL
RIGHTS IN RELATION TO OTHER RIGHTS (Chapters 1 – 3)
LU 3 - Place in legal system
SA legal system
Substantive Adjective
law law
Law of Law of
Private law Public law
procedure evidence
Patrimonial Law of Law of

Family law
law persons personality
Law of
property / Law of Law of Intellectual
things succession obligations property law
LU 1
Current scope of law of
property- Chapter 1
Traditonally private law Traditonally not private law
Traditional law of things Aspects of constitutional law
References to law of obligations
References to commercial law
References to immaterial property law

LU 1
Sources of law
Traditional law of things before Current law of property

1994 since 1994
(Roman-Dutch) common law (Roman-Dutch) common law
Statutory law (legislation) Statutory law (legislation)
Case law (precedent) Case law (precedent)
Customary law
Constitution
1
LU 2 – Definitions (TB pages 10 – 12)
Person Natural & Juristic person
Anything with regard to which a person can acquire and hold a

Object
right
Everything which can form part of a person’s estate, including

Property
corporeal things and incorporeal interests and rights
Specific category of property, which is defined with reference

to its characteristics: a corporeal object outside the human
Thing body, and an independent entity capable of being subjected
to legal sovereignty by a legal subject for whom it has use
and value
Legally recognised and valid claim by a subject to a certain

Right object. Not all relations between a2 person and an object are
recognised and protected by law
LU 2 – Definitions (TB pages 10 – 12) … continue
Property right /
Any legally recognised claim to or interest in property
real right
Creditor’s right / A right against a person - requiring some sort of eight

personal right performance from such a person (TB P 28)
A claim or action is lawful when it is acknowledged and

Lawful
protected by existing legal principles
Legal procedure provided by legal system to protect a

Remedy right against infringement or 2to control effects of an
unlawful act or situation
10
Theme 2 – Property & Things

 LUO4: Define a thing as a legal object. Chapter 2 (TB pages 15 – 25)
 LUO5: Distinguish between corporeal
and incorporeal things with reference
to practical examples.
 LUO6: Indicate which principles must
be applied to distinguish between the
following categories:
a) negotiable and non-negotiable
things;
b) singular and composite things;
c) movable and immovable things;
d) fungible and non-fungible things;
e) consumable and non-consumable
things
 LUO7: Distinguish between principal
things, accessory things, auxiliary
things and fruits and apply this
distinction in practice.
11
Property and things- Chapter 2 (pages 13-14)
LU 4
‘Property’ = a wide variety of assets that make up a person’s estate or
belongings, which serve as objects of rights that such a person exercises in
respect thereof and which are constitutionally protected.
Assets include:
1. Tangible and perceptible e.g. car or house;
2. Intangible or imperceptible e.g. an amount of money owed in terms of a
contract (creditor’s right) or copyright in respect of a book (intellectual
property)
It is necessary to define rights in property more broadly than was done

previously e.g. rights that a traditional indigenous tribe exercises in respect of
their kraal property.
Definition of a thing:
Thing = a corporeal or tangible object external to persons and which is, as an
independent
Thing = a corporeal or tangible object external to persons and which is, as an
independent
Property and things
Characteristics of a thing
a) Corporeality and incorporeality
b) External to Humans
c) Independence
d) Appropriability (subject to human
control)
e) Use and Value
Each characteristic will be unpacked below.

Property and things … continue
(a) Corporeality and incorporeality (LU 5)
An object can be labelled corporeal if it is tangible i.e. it can be
observed / perceived with any one of five senses and it occupies
a certain space
e.g. horse, motor bike, residential site (with a house on it), cylinder with oxygen
Non-physical types of property (i.e. incorporeal property / intangible interests in

property with a distinct economic value) are becoming more important in
private, commercial and public areas of life.
(a) Corporeality and incorporeality
Intangible objects include forces of energy such as heat, radio activity, light,
sound and electricity. Incorporeal objects may also refer to rights.
In some foreign legal systems practical requirements
made it necessary to regard forces of nature
(electricity and atomic energy) as things. It is not yet
settled in SA law whether energy may qualify as a
thing.
The following subjective rights currently distinguished in

SA law where the object of a real right is not a
corporeal thing, but a subjective right :
 Real rights (with things as objects)
 Intellectual property rights (with intellectual
property as objects)
 Personality rights (with aspects of personality as
objects)
 Creditor’s rights (with obligations as objects)
(b) Impersonal nature (external to humans)
A human being cannot be a legal object i.e. humans are not things – human beings are
always regarded as LEGAL SUBJECTS.
Section 10 of Constitution = all humans have an inherent and inalienable right to dignity.
Human corpses or parts of corpses can possibly be classified as legal objects, but then
as legal objects which fall outside legal commerce.
Parts of bodies which can no longer be connected to a human being, can be regarded
as negotiable things (e.g. hair used to make a wig, semen, blood, ova) – this is,
however, subject to provisions of National Health Act 61 of 2003, especially
regarding availability of human reproductive cells and organs (for purposes of
artificial reproduction) and organs (for purposes of organ transplantation) from
living and deceased persons.
(c) Independence
A thing must be a definite and distinct entity that exists separately
e.g. a house generally does not exist separately and independently from land upon
which it is built and to which it is firmly attached. Also, a key on its own has no
meaning but has to be seen as an instrument of access to another object such
as a house, a post box or a vehicle.
Water, land, sand and air must first be separated by human activity into recognisable
and manageable entities before they will be regarded as things which fall within
legal commerce.
Air and oxygen become negotiable things only if they are contained in cylinders.
In case of composite things, object is composed of various components. It is

sometimes difficult to determine whether components form part of composite
thing or exist as separate entities.
e.g. a house is usually alienated with all its fixtures and fittings, but certain items may
be excluded in contract of sale – a chandelier attached to a ceiling or a mirror
attached to a wall may be contractually excluded and then removed (or even
physically removed before house goes on sale).
(d) Appropriability (subject to human control)

A thing must be susceptible to human control
– control here refers to possibility of
enforcing and protecting right in thing.
Sun, moon and stars will not qualify as things

because they cannot be appropriated.
Aspects of nature such as the sea and air we

breathe is also not susceptible to control.
However, air compressed in a gas cylinder
may function as a thing because it has been
under human control.
(e) Use and value

It is a characteristic of a thing that it must be useful and valuable to a legal
subject and must be destined to satisfy needs of a legal subject. No legal
relationship can exist between a corporeal thing and a legal subject if it is
not useful and valuable to legal subject. It need not necessarily have
economic value but can also have sentimental value. However, usefulness
and value are determined objectively
e.g. a dead leaf may not have any value to anyone, but a collection of dead leaves
and other plant matter may be negotiable as compost.
Dangerous or unwanted objects (e.g. industrial or chemical waste) may also

qualify as things, even though their value would be negative.
Example:
A dead leaf in my garden, in my subjective evaluation, be without value to me and
cannot conceivably satisfy my needs if it is merely a nuisance.
Objectively evaluated, it could be valuable because it could be used as compost or in

a scientific study. It remains a thing because it satisfies someone's needs.
Relationship between things, rights and
property
All above items = assets and may act as

• Anything that can be
object of certain rights in terms of

touched
doctrine of subjective rights.

Tangible • e.g. a house, an
iPhone or a Jaguar
• Unable to be
touched; not having
physical presence
• E.g. copyright over a
intangible
song he composed,
or his claim against
his friend (J) for
repayment of a loan
Relationship between things, rights and
property
Rights relating to assets in one’s estate = PATRIMONIAL rights

 may relate to tangible things
 but also to other legal objects
 Example: immaterial property & performances in terms of a contractual or
delictual obligation
Common denominator between these rights is that they all have patrimonial
value.
Section 25 of Constitution
 ‘property clause’ and guards against unconstitutional deprivation and
expropriation of property.
 In terms of this clause, it is assumed that ‘property’ includes ANY
patrimonial right to be protected or regulated.
CLASS QUESTION: CAN YOU THINK OF ANY MOVEMENTS WITHIN OUR

SOCIETY TODAY THAT MAY CHANGE SECTION 25?
LU 6
Classification of things (TB page 20)
(Negotiable and non-negotiable)
 Things privately owned (res in
commercio)
 Things currently owned (res alicuius)

and things that are not currently owned
(res nullius).
 Things that are currently owned may be

owned by individuals (res singulorum)
or corporate bodies (res universitatis).
 Things that are unowned may be

divided further into things that have
never been owned (referred to here as
res nullius proper), and things that
were owned but later abandoned (res
derelictae).
 Things that have been lost (res

deperditae), however, still belong to
someone because owner has merely
lost physical control but has not
intended to give up ownership. Lost
things accordingly qualify as res
alicuius.
LU 6
• Res nullius
o things that have never been owned
o e.g. wild animals or birds, fish, and products of the sea.
o It is possible to establish ownership over such things by
appropriation (i.e. by unilaterally taking control thereof), for
instance by catching or taming a wild animal.
o Ownership of such an animal is lost if the animal escapes and
regains its freedom, or where, despite being tamed, it escapes
and does not return.
• NOTE: 3
o Legislation has changed common law position in respect of many

wild creatures and other natural resources
o e.g. Game Theft Act which criminalises hunting or poaching of
wild animals under certain circumstances.
4 o I.t.o this Act - if wild animals that are kept for hunting or
commercial purposes are killed or captured by an unauthorised
person, they cannot become property of hunter (as would have
been case under common law).
o Instead, they remain property of person on whose land they are
kept pursuant to a certificate issued in terms of Act, or, they
become property of person on whose land they were captured.
Game Theft Act thus effectively excludes common law rule that
wild animals that escape from control of their owners revert to
being res nullius.
LU 6
• Category of things that cannot be privately owned (res extra commercium)
• Further division among things that are common to all (res omnium communes)
• Things that are public (res publicae)
• Religious things (res divini iuris).
o Category of religious things is obsolete in modern property law and items
associated with this category
o e.g. graves, graveyards and tombstones, are privately owned and protected
from desecration by remedies in criminal law and delict (actio iniuriarium). 3
• This does not mean that rights of others are completely denied.
• Extension of Security of Tenure Act acknowledges right of occupiers of land in
terms of Act, to bury deceased family members on land where they reside.
4
o This matter has been considered by courts in recent years
o These rights may exist where an established practice of burial is evident, but
they do not override other legislation or by-laws dealing with burials.
LU 6
 Things common to all people (res omnium communes) belong to no one in particular and
everyone at once e.g. air that we breathe, running water and sea. They cannot be owned
privately, but it is possible to acquire ownership of portions thereof by rendering them
susceptible to control.
 Compressing air in a gas cylinder would thus reduce thing, comprised of filled cylinder,
to being negotiable (in commercio).
 Public things (res publicae) belong to an entire civil community and are often referred to as
state property. This does not mean, however, that these things are in (private) ownership
of state. Rather, state holds things for benefit of its subjects e.g. public roads, public rivers
and harbours.
 Due to statutory intervention, sea and seashore are regarded as public things in SA law.
Since the State assumes control over public things, this property may not necessarily be
freely used by everyone.
 Mineral and petroleum resources have been placed in custodianship of state by recent
legislation, thus (arguably) bringing them within ambit of res publicae.
 Use of these resources is strictly regulated e.g. although anyone may apply for a prospecting
or mining right, compliance with a strict set of requirements, most of which support public
interest in general, is required before person is eligible to be awarded such rights.
 Similarly, water is now under supervision of state in terms of National Water Act. This scarce
resource must be managed and distributed so that constitutional right of access to (potable)
water can be realised progressively for all South Africans.
LU 6
Classification of things (TB pages 20 - 25)
(Classification according to nature)
LU 5
Corporeal vs. incorporeal things
Distinction between corporeal and incorporeal is important since it affects type
of control that lies at heart of many processes acknowledged in property law
Corporeal Incorporeals
• Tangible or can be perceived by senses • cannot be touched or perceived by
• Examples: Land and houses, books, senses – they have no physical
vehicles, technical equipment such as a existence but an intrinsic monetary
computer or flash drive, food and value
clothing • Examples: Forms of energy, such as
• Type of control – example: land (a light, heat and sound, and rights
corporeal) may be acquired unilaterally • When a right fulfils same function as a
if acquirer is able to show that she has thing i.e. when it functions as an object
possessed land openly as if she were in respect of which rights, duties and
owner for a period of 30 years capacities can be exercised
• Type of control – example: right in land
(e.g. a grazing right) may be acquired
unilaterally if acquirer can show that
she has used land as if she were entitled
to do so, for a period of 30 years
LU 6
Movable vs Immovable things
(This distinction is crucial to determine how various things may be acquired.
Different rules and procedures govern these two classes)
Movable Immovable
• moved from one place to another • cannot be so moved
without being damaged or losing their • Example: land.
identity • Everything that permanently attaches
• Example: furniture, vehicles, money, to land is also regarded as immovable
and clothing – this includes buildings or other
installations and things permanently
attached thereto, and vegetation such
as trees, and unharvested crops
These examples are all, simultaneously, examples of corporeal things.

Although it seems illogical to try to classify incorporeals as either movable or immovable
based on mobility (because incorporeal things cannot physically be moved), we stille need to
determine:
 How such things may be alienated or acquired
 What kind of real security rights may be established over them
 Whether they may be sold in execution and how this may be undertaken
 Which jurisdictional rules would be applicable if a dispute in respect of the thing has to
be settled in terms of international law; and
 Which rules of criminal law may be applicable
In Roman-Dutch law, mobility of an incorporeal thing was established only when necessary,
reference point being nature of object of right concerned – still applies in SA Law 28
LU 6
Movable vs Immovable things … continue
All real rights over immovables are immovable things (where they function as
objects of further rights), while real rights over movables are movable under such
circumstances.
Personal rights are always movable, regardless of whether underlying asset could
be classified as movable or immovable.
A usufruct over contents of a home would thus be an incorporeal movable, while a

usufruct over house itself would be an incorporeal immovable.
Some incorporeals will always be immovable because their object is immovable

e.g. rights of use or habitation of land (usus and habitatio respectively), praedial
servitudes (right that attached to the property itself (not on a person) and building
restrictions. e.g. a property owner in one property can exercise a right on another
property owned by someone else or it can also prohibit one owner of exercising
normal ownership
Incorporeals recognised as movable include shares in a company, a member’s

interest in a close corporation, goodwill of a business, and immaterial property
rights, such as patents, designs, and trademarks.
LU 6
Single vs. composite things
Single Composite
• individual things that exist independently • different components joined together
and comprise an entity that has use and to form a single entity in law
value • Example: a sectional title unit, a
• Sometimes, thangs have value when dealt
within in quantities e.g. sand or bees. house or a bicycle. Components that
• Sometimes various single entities are make up a composite thing are
grouped and dealt with as an economic principal thing and accessory things
unit - example : a flock of sheep, a • There may also be auxiliary things
collection of baseball cards or paintings by that belong with composite thing for
a particular artist. some purposes.
• Such a grouping is called a collection or an
aggregate – individual things in aggregate
exist independently, may be alienated or
acquired independently, but may also be
acquired, alienated, encumbered or • (We will come cack to this in LU 7)
protected as an aggregate.
• NOTE : an aggregate or collection is not
same legal concept as a composite thing.
Items in a collection may be single or
composite things themselves. Collection or
aggregate describes grouping
30
LU 6
Divisible vs. indivisible things
(is important in context of co-ownership. In event of termination of
co-ownership)
Divisible Indivisible
• Separated into parts, each of which has • Indivisible things cannot be so divided
same nature and function as whole before it • Example: a car or bicycle may be separated
was divided. into its various parts, but these parts will not
• Total value of separated parts should not be have same nature or function as car or
significantly less than value of whole. bicycle when in its whole state. Such items
• Legal divisibility rather than physical are therefore not divisible things as
divisibility requirements mentioned cannot be met
• Example: a barrel of wine may be divided • a division of things that are legally
into separate bottles. In such a case, wine indivisible cannot be ordered even if they
still has same nature and function after could be divided physically.
being bottled as when it was still in barrel. • In such a case, court makes an order that
Similarly, land may be divisible, subject to thing be sold by public auction and that
certain statutory limitations proceeds of sale be divided among co-
owners. Or, court may award thing to one of
co-owners and order that other co-owners
be compensated for their loss.
31
LU 6
Consumable vs non-consumable things
Consumable Non-consumable
• when they are destined to be used • use does not result in a substantial
up change to or reduction of things
• Example: consumed by use e.g. • Example: land or artwork
food and fuel
• They are destroyed through use
General note:
• Things can be partially (rather than fully) used up through use – BUT distinction
becomes more problematic.
o Example: it is debatable whether clothing, machinery or vehicles, which may
become worn or less effective through use, are consumable or not.
• Modern SA law - suggested that such things should be classified as consumable

or non- consumable based on a test of reduction in value of things.
o If there is a substantial reduction in value over time? Yes - thing classified as
consumable.
Usufruct: it is a legal right given by an owner to someone who is not the owner, to use
the owner’s property for a certain period, usually for a lifetime period. 32
LU 6
Fungible vs. non-fungible things
Fungible Non-fungible
• separate individual entities that are identical • individually determined
to one another • Thing is unique by nature, have distinctive
• Example: several 340 ml cans of Coca Cola individual qualities, or some specified
• One resembles another so that they are not characteristic that makes them different from
individually determined and can be other things. Interchangeability is either
interchangeable for some purposes. impossible or not permitted.
• While it is possible to deal with them
individually, in general trade they are usually
dealt with by reference to their weight,
number or size
General note:
• Some things are by nature non-fungible - painting of Mona Lisa)
• Other things may be designated non-fungible - when merchant wants a specific quality
of potato and will not accept a substitute
• If things are not by nature fungible or non-fungible, then they can be so designated by
intention of parties to a contract or by intention of a testator in drawing up his will.
• Distinction between fungible and non-fungible is more important in law of succession
and law of contract than in law of property
• However, in context of mandament van spolie, courts have dealt with whether restoring
status quo ante means that exactly same things have to be restored to spoliated
possessors, or whether (fungible) material ‘of similar size and quality' could be
substituted 33
LUO7
Distinguish between principal things, accessory things,
auxiliary things and fruits and apply this distinction in practice
Principal thing
 That part which gives entity its identity or character

 Example: frame of a bicycle or chassis of a car, an egg beater or an electric
drill.
 Thing which exists independently, and which can, as such, be object of real rights
 it does not form part of another thing either as component (accessory thing)
or as supplement (auxiliary thing).
 Owner of principal thing is owner of composite thing, which includes accessory

and auxiliary things to principal thing
 NOTE : Land is ALWAYS regarded as principal thing

LUO7
Accessory thing
 Thing which can exist independently of principal thing, but which has merged
with or been mixed with principal thing to such an extent that it has lost its
independence.
 All attachments which do not help to determine composite thing’s identity
can be classified as accessory things
 Example: a wooden beam built into a house, roof carrier of a car, brick built
into a house, pearl set into a necklace, chandelier fitted into the dining
room ceiling
This Photo by Unknown Author is licensed under

CC BY-SA This Photo by Unknown Author is licensed under CC BY-SA This Photo by Unknown Author is
licensed under CC BY-SA
LUO7
Auxiliary thing
 An auxiliary thing is a thing which exists separately

and independently of principal thing, but which,
because of its economic value, destination or use, is
no longer regarded as an independent thing for
purposes of property law. There need not be a real
physical connection with principal thing.
 To identify an auxiliary, it must be evident that it is meant to be

of permanent use to principal thing, and, in fact, necessary for
effective use of principal thing.
 Example: key to a door, customised bar stools, seat covers

designed for specific dimensions.
 See Senekal v Roodt 1983 (T)- Held that separate bar stools,
made of the same wood as a built-in bar and meant to be part
of the bar, were part of the bar as auxiliary things.
LUO7
Fruits
 Fruits are products of a principal thing, which may be a living creature, plant
matter or even an incorporeal.
 Fruits are destined to be separated from principal thing and, through
separation, to gain separate legal identity.
 Natural fruits e.g. offspring of animals, wool, fruit or milk
 Civil fruits e.g. income produced by investment (i.e. dividends, interest on
capital, royalties or rental). General principle = owner of principal thing is also
owner of fruits.
 However, owner may entitle another to draw fruits e.g. a usufructuary or a
lessee. A lessee is not automatically entitled to fruits – terms of lease
agreement govern whether such entitlement exists.
 **Point at which someone other than owner becomes owner of fruits depends
on whether fruits are still attached to principal thing or whether they have been
separated or harvested already.
 Example: You rent a property from the owners. The property has an avocado
tree on the property. Who is entitled to the avocado? The owner or the tenant?
 The tenant: renting the property gives you peaceful and undisturbed
possession of the property (house) as well as the land and/or garden.
Khan v Minister of Law and
Order 1991 (T)-
IMPORTANT
• Case provides a good example of

application of principles regarding
classification of things according to
their nature, into principal, accessory
and auxiliary things.
• Khan (applicant) was dispossessed of

his vehicle by SA Police. Court
proceedings came from his attempt to
have vehicle returned to him. Vehicle
was built up from different wrecks, and
rear end (1988 BMW) was identified as
part of a stolen vehicle. It was
undisputed that engine and inner front
(1985 BMW) belonged to applicant.
There were other components, some of
which may have been taken from stolen
vehicle and built into Khan’s vehicle,
while others seemed to have originated 38
from a third source.
Khan v Minister of Law and
Order 1991 (T)-
IMPORTANT
• Accessories follow principal thing. It

was thus important for court to
establish WHICH part of built-up
vehicle formed principal thing, and
which parts were merely accessory to
it. Applicant could have vehicle
returned if his part was determined to
be principal part. Court reiterated rule
that where one movable is joined to
another in a manner as to form an
entity, owner of principal thing
becomes owner also of thing joined to
it.
• Court indicated that deciding which

part is principal and which is accessory
is generally a matter of common sense.
Guidelines, which may aid decision,
refer to value, bulk or size of thing.
39
Khan v Minister of Law and Order 1991 (T)- IMPORTANT
• In this case, court found that thing that

gave composite whole its ‘character, form
and function’ would decisively be principal
thing.
• Court found that stolen rear end of built-up

vehicle gave it its character, form and
function, which meant that Khan could not
recover vehicle because part that belonged
to him originally had acceded to principal
part i.e. stolen part.
• In this particular context, consideration

that weighed heavily on decision was fact
that vehicle looked more like that used to
rebuild rear end. Fact that internal
components (especially engine and inside
front panels) were from vehicle of
applicant, was not as weighty as overall
appearance of vehicle.
40
42
Theme 3 – Rights

 LUO8: Distinguish between the different  Chapter 3 (TB pages 27 – 47)
rights in property by means of examples.
 Ex parte Geldenhuys 1926 OPD
 LUO9: Discuss the various legal 155
relationships a person may have with
regards to a thing.  Cape Explosive Works Ltd v
Denel (Pty) Ltd 2001 (3) SA 569
 LU10: Define a real right in terms of the (SCA)
doctrine of subjective rights.
 LUO11: Discuss the importance of the
distinction between real and personal
(creditor’s) rights in the case of
corporeal immovable property.
 LUO12: Distinguish between personal
and real rights in terms of the
subtraction from the dominium-test.
 LUO13: Name the different types of real
rights.
43
CHAPTER 3
Property rights, real rights and creditor’s rights
Limited real right

• Right in a corporeal
or incorporeal thing
• belonging to
another person
Real right
• Right in a corporeal
Creditor's or
or incorporeal thing personal
• Belonging to oneself right
• Right against a
person
X’s creditor’s right

against Y entails that
Rights Y must :
 Do something
 Refrain from
doing something
 Pay X money
 Give X or
someone else
something
44
25
Property rights
A Motor car Ownership is a REAL RIGHT in motor car

B House Ownership is a REAL RIGHT in house
C Flat in a sectional title scheme Ownership is a REAL RIGHT in sectional title unit
D Time-sharing interest in a Shares in in share-block scheme are CREDITOR’S RIGHTS
share-block scheme against company
E Shares in a mining company Shares are CREDITOR’S RIGHTS against company
F Short-term lease of an office Lease is CREDITOR’S RIGHT against owner of building
suite
G Registered long-lease of a Registered lease is a LIMITED REAL RIGHT in factory
factory
H Registered right of way over Servitude is a LIMITED REAL RIGHT in farm
a neighbour’s farm
I Mineral rights in family farm Mineral rights are LIMITED REAL RIGHTS in farm
J Usufruct of implements on Servitude is a LIMITED REAL RIGHT in implements
family farm
K Registered bond over a Real security right is a LIMITED REAL RIGHT in farm
neighbour’s farm for a cash loan
forwarded to neighbour
L Copyright to a book on IMMATERIAL PROPERTY RIGHT in contents of book
family history
M Right to a state pension and CREDITOR’S RIGHT against state pension fund and medical
medical scheme to which scheme
person contributed for 10 years
Distinction between real rights and personal rights
Real rights Personal rights

Corporeal thing (except a pledge Performance (to give something,
of claims) Pledge is where you to do something or not to do
Object provide possessory title to a something)
creditor as security of payment of
a debt.
Holder of a real right has a direct Holder of a personal right is
claim to and a right of disposal entitled to claim performance from
Content over a thing a specific person
Holder of a real right can enforce Holder of a personal right

his real right by means of a real enforces his right by means of a
action (e.g. rei vindicatio) of personal action e.g. condictio
Remedies owner, which can be instituted furtiva (action of an owner against
against anyone who is unlawfully thief to claim back stolen object)
in control of thing
Real rights have their origin in Personal rights come into

legal facts other than obligations existence through obligations
Origin e.g. delivery, accession e.g. in terms of a contract or a
(accessio) and prescription delict
Real rights are absolute in Personal rights are relative in

principle : holder of right can principle : holder can enforce his
vindicate his thing (subject to right only against person who is
Absoluteness certain exceptions) from obliged to perform in terms of
whomever is in control of thing an obligation
28
In case of insolvency, a real Apart from a few exceptions,

right enjoys preference over this principle does not apply
other rights to personal rights
Preference Maxim ‘first in time is stronger

in law’ (prior in tempore est
potior in iure) is applied in
case of two or more
competing real rights
Creation, transfer or extinction
of real rights requires some
form of publicity :
 Delivery – transfer of
ownership of movable
things
 Registration –
immovable property
Publicity Reason for this lies in nature
of real rights. Since these
rights have to be respected by
world at large, there must be
some form of publicity
informing outsiders of
existence, transfer or
extinction of real right
Deeds Registries Act 47 of 1937 governs

registration of deeds pertaining to rights
in immovable property in SA.
Section 63(1) of Act = only real rights in

Ownership * Registrable: immovable property may be registered,
Sec 16 Deeds Registries Act and consequently lawyers and courts
are often faced with question as to
whether a particular condition in a deed
Limited real rights * may be registered or not :
Registrable: Sec 63(1) Deeds
Registries Act  If it amounts to a real right –
condition may be registered, and in
such a case registration will effect
Other rights and transfer or acquisition of a real right;
permissions * Usually not
registrable but
 If right is a creditor’s right – it may

not be registered. In these cases,
question whether right is real or
personal can obviously not depend
upon fact of registration, since
question is whether or not right may
be registered.
Difficulty in drawing distinction between real rights and personal

rights
Typical Roman law categories of real rights included ownership, servitudes, real
security rights and a building right referred to as superficies.
It must be kept in mind, though, that demands of modern commerce and legal practice
make it necessary sometimes to create rights that do not resemble typical Roman law
kinds of rights for following reasons :
1. SA law does not acknowledge a numerus clausus (closed system) of real rights,
which means that not all rights created and classified as real, easily fit into these
traditional Roman law categories.
2. Principles of freedom of contract and of testation (making a will) allow people to

establish new, peculiar real rights in respect of their immovable property.
This can lead to difficulties in identifying accurately nature of rights thus created. It is
especially rights in immovable property (land) that pose problems and, specifically (but
not exclusively), where a monetary obligation is attached to rights created in terms of
an agreement or a bequest in a will..
Difficulty in drawing distinction between

real rights and personal rights
Following examples are taken from existing case law :
a) A testator bequeaths land to his son and links it to

an obligation placed on son to pay surviving spouse
of the testator an amount of money, either once-off,
or at regular intervals.
b) A testator bequeaths a farm to his children. Will

contains detailed provisions as to how farm should
be divided i.e. by drawing of lots. It further provides
that child who draws part that includes farmhouse
has to pay an amount of money to his siblings.
c) In an agreement to divide land, co-owners of land

agree that if either part of land is developed in
future as a township, they and their descendants
will share profits.
d) A contract of sale in respect of land contains a use

restriction (e.g. it may only be used for industrial or
conservation purposes). It also contains a clause
that enables seller to buy back land from purchaser
if land cannot be used in accordance with limitation.
In each case, nature of rights or obligations contained in provision must be

established as either real or personal (creditor’s right).
This is an important determination because only real rights in land are registrable and
hence automatically enforceable against successors in title.
If nature of right or obligation is personal, then a successor in title cannot be

automatically bound. This means that the full agreement or bequest might not be
given effect, which would be contrary to principles of freedom of contract and of
testation.
Registrability of rights or obligations is thus an important mechanism by which rights

may be enforced.
Above examples entail disputes about whether rights that were already created could
or should be registered; or should have been registered and were not; or were
registered, but erroneously. In one instance, the question was not registrability, but
rather whether rights created gave rise to a particular kind of tax arising only from
real rights.
LU 12
Subtraction from dominium test -
IMPORTANT
In addition to theoretical approaches to distinction between real and creditor’s rights,

SA courts have developed their own approach to this problem – this approach, known
as ‘subtraction from the dominium test", was first formulated in 1926 in authoritative case of
Ex parte Geldenhuys.
Ex parte Geldenhuys 1926 OPD 155

In a mutual will, a husband and wife left a piece of land to their children in undivided
shares (co-ownership). Will determined that surviving spouse should, upon eldest child
reaching majority, cause land to be divided amongst children in equal portions by
drawing of lots. Child who drew portion upon which homestead was built should
compensate other children by paying an amount of money to each of them. Registrar of
deeds refused to register conditions imposed by will, arguing that they were not
concerned with real rights in land.
Van der Walt A and Pienaar G Introduction to the Law of Property JUTA: Cape Town
(2016)- Chapters 3, page 32-35
Subtraction from dominium test –
IMPORTANT … continue
Two conditions that created problems are following :
a) Will stipulated specific conditions with regard to time and manner of subdivision of
farm. Usually co-owners are free to decide when and how they want to subdivide
common property. Condition places a restriction upon this common-law freedom to
subdivide, and simultaneously creates rights (in favour of each child against others)
to enforce these prescriptions.
1st question = whether these rights to have subdivision done at a specific time
(when eldest child reached majority) and in a specific manner (in equal portions to
be determined by drawing lots) create real or creditor’s rights ?
b) Will also stipulated that child drawing most valuable portion (with house on it)
should compensate others by paying them a sum of money.
2nd question = whether right of other children to claim this sum of money is a real or a
creditor’s right ?
Problem with registration of rights
Question as to whether these rights are real or creditor’s rights arose in context of
registration - Deeds Registries Act 47 of 1937 provides in section 63(1) that only real rights
in land may be registered, and registrar of deeds refused to register rights described
above because he thought that they were creditor’s rights only.
Question whether these rights are real or creditor’s rights is also

important for their enforcement, because :
 If they are creditor’s rights – they can be enforced only against a SPECIFIC
DEBTOR (other children)
BUT
 If they are real rights – they can be enforced against ANY PERSON (such as
subsequent owners, should one of children sell his share).
Formulation of subtraction test
Court approached problem in a very practical manner: in order to facilitate matters it

was said that one should look at obligation created by right in question.
Obligations implied by two rights identified above are following :

a) An obligation was placed upon all co-owners to exercise their right of subdivision
at a certain time (when oldest child reached majority) and in a specific manner (by
drawing lots for portions of equal size).
b) An obligation was placed upon child who drew portion with house on it to
compensate others by paying them a specified amount of money
Then court also proposed to determine effect and intention of those obligations :
(a) If obligation is a burden upon land it is said to be a subtraction from dominium or

ownership, and then corresponding right is a real right and it may be registered.
By saying that obligation is a burden upon land, court indicates that obligation
affects any owner of that piece of land, irrespective of his personal identity, and
irrespective of any contract. Subsequent owners are, therefore, bound by
obligation, just like original owner.
(b) If burden is placed upon a specific person in his personal capacity, however,
corresponding right is a personal or creditor’s right, and it may not be registered.
Result = such an obligation does not affect subsequent owners of land, because
burden is placed upon specific person in his personal capacity and not in his
capacity as owner of that piece of land.
In effect, court’s approach implies that a real right is concerned with and
accompanies property (land), whereas a creditor’s right is concerned with
and accompanies person. If person upon whom obligation rests sells
land to a different person, a real right would ‘follow land’ and would still be
enforced against new owner, whereas a creditor’s right would ‘follow
person’ and will be enforced against original person, but not against new
owner.
Application to facts of case
Finally, court applied subtraction from dominium test to facts of case :

(a) 1st set of obligations diminished co-owners’ normal right of subdivision, and was intended to
do so – this obligation was meant to affect all co-owners and all subsequent co-owners. It
meant that co- owners would lose some of their normal entitlements, and therefore it was a
burden upon land i.e. a subtraction from dominium.
Corresponding right was, therefore, a REAL right which should (and ought to) be registered.
Registrar of deeds was instructed to register condition concerning time and manner of
subdivision.
(b) 2nd second set of obligations placed a burden upon one child only, (one who drew portion
with house on it), and it was clearly a one-off burden which was intended to restore balance
once portions had been distributed. It was, therefore, a burden which rested upon a specific
person in his personal capacity only (as person who benefited from division), and
corresponding right did not subtract from dominium itself.
Corresponding right was a CREDITOR’S RIGHT which could not be registered.
HOWEVER, that part of condition in will was so closely connected with 1st part that court decided
that both should be registered together for convenience, without thereby affecting personal
nature of creditor’s right in any way.
Rights of other children to demand payment from one who received house were creditors’ rights,
and it was registered by way of an exception, without changing nature of right.
Obligations to pay money to someone
In subsequent cases, 2nd second aspect of Geldenhuys case, concerning right to payment of
a sum of money, proved to be one of major problem areas concerning distinction between
real and creditor’s rights.
In view of Geldenhuys decision, it was clear that one-off payments of money which affected
one person personally (and not as owner of land in question) could never be real rights, but
that still left question open with regard to other rights to receive payment of money (rights
to sums of money which are not one- off payments e.g. periodic payments; and rights to
either one-off or periodic payments that rest upon a person as owner of land in question
and not personally). This question was addressed in several later cases.
Intention of parties
What is situation if testator or parties who concluded contract intended right to be a real right ?
It may be inferred from Geldenhuys decision that such an intention cannot override
principles of law – regardless of intention, it is impossible to create a real right if right in
question clearly places obligation upon debtor in his personal capacity.
However, wherever possible, intention of parties is an important clue which may help court
in deciding whether obligation was supposed to be real or personal.
SUMMARY OF Ex parte Geldenhuys 1926 OPD 155
Crucial Facts:
1. Registrar argued conditions did not create real rights – refused to register;
2. S 63(1) of the Deeds Registry Act- only real rights may be registered.
3. NB- Joint Will Left pieces of land to the children.
Obligation to Pay someone:

4. Once-off payment of money to someone which affected one person personally DID
NOT constitute a real right.
5. Rights to receive moneys/payment periodically not addressed.
6. See later cases.
Intention of the parties:

7. Intention cannot override principles of law;
8. Regardless of intention, it is impossible to create a real right if the right in
question places an obligation upon a debtor in his/her personal capacity.
Sub Test Requirement:

9. If an obligation is a burden upon land, subtraction from dominium;
1. Right is a real right;
2. Obligation affects the owner
3. Personal capacity= real right.
Lorentz v Melle 1978 (3) SA 1044 (T)
• Two parties bought a farm together as co-owners.

Before doing so, they concluded a contract to
effect that they would subdivide farm into three
portions, and then transfer ownership of one
portion to each of them while remaining co-owners
of 3rd portion.
• They further agreed that, should one of them

establish a township on his separate portion, other
party would acquire a right to ½ of profits from
selling stands in township. These conditions were
embodied in a notarial deed and registered
together with title deed of farm with intention of
establishing them as a burden against that title.
• Eventually, farm was subdivided into several

smaller portions, and parties in this case were
owners of such portions. One of parties claimed
that conditions, that were still registered against
title deed of each portion, created creditors’ rights
and not real rights, and that they were registered by
mistake. In an earlier decision, an order to this
effect was granted, and other party appealed.
62
Differences between
Geldenhuys and Lorentz cases
Geldenhuys Lorentz
Conditions were
registered together with
Question was whether
title deed, and question
these conditions
was whether registration
could be registered?
of these conditions had
been a mistake?
Conditions were Conditions were agreed

created in a will upon in a contract
63
Similarities between
Geldenhuys and Lorentz cases
Geldenhuys Lorentz
• 2nd condition is concerned • Condition is concerned with a
with a right that implies right that implies that one
that one person must pay a person must pay a sum of
sum of money to another money to another person
person • Question that had to be
• 2nd condition rested upon a answered was whether
specific person only and condition which laid down
that it was a creditor’s right, obligation to pay sum of money
and it was registered (and which had already been
together with rest of registered) in that case created
conditions only as a matter a real right or a creditor’s right
of convenience
64
Application of subtraction test
Court found that obligation in question did amount to a subtraction from

dominium, and that parties had intended that it establish such a subtraction,
but that this obligation did not affect owner’s right to use of land in physical
sense – this last consideration, which was never raised in Geldenhuys case,
in fact amounts to a substantial amendment of test as set out in Geldenhuys,
and sets a much narrower and more restricted standard for creation of limited
real rights.
Effect = limited real rights can be created only when they result in a
subtraction from owner's right to physical use of property – a result which
conflicts with nature and effect of many traditionally recognised limited real
rights such as mortgage bonds and mineral rights.
This decision was confirmed by:

SCA in Erlax Properties (Pty) Ltd v Registrar of Deeds and Cape Explosive Works
v Denel.
Van der Walt A and Pienaar G Introduction to the Law of Property JUTA: Cape
Town (2016)- Chapters 3, page 36-37
65
Subtraction test - Continue
 Court in Lorentz - effectively decided that an obligation to pay a sum of money

could never constitute a real right, and that it would always amount to a
creditor’s right – this decision is premised upon idea that a real obligation must
place a physical burden upon owner’s entitlements of use and enjoyment.
 This additional test is questionable, as it never formed part of original test as

formulated in Geldenhuys, and was obviously motivated by court’s wish to
prevent a proliferation of burdens upon landownership.
 In Denel case, burden imposed on landowner included a physical burden (use

restriction) and a non- physical burden (right of 1st refusal upon realisation of a
certain condition). Restrictive test of Lorentz decision, therefore, does not seem
to exclude a wider application of subtraction test.
66
 A further problem with Lorentz decision is that it creates impression that

intention to create a real right is of no consequence whatsoever. In this case,
intention of parties was clearly to create a real right, and right was registered as
such, but court was still willing to override that intention. It does not seem as if
intention to create a real right was contrary to specific legal principles either,
and it is possible that court awarded intention of contracting parties too little
weight in this decision.
 In Denel case it was made clear that intention to create a real right was as
important as question as to whether burden was capable of registration.
67
Lorentz v Melle 1978 (3) SA 1044 (T)
Summary
Crucial Facts:
1. Conditions registered together with the title deed.
2. Was the conditions registered by mistake?
3. Question that had to be answered was whether condition
which laid down obligation to pay sum of money (and
which had already been registered) in that case created a
real right or a creditor’s right.

4. The obligation here to pay a sum of money could never
constitute a real right.
5. effectively decided that an obligation to pay a sum of money
could never constitute a real right, and that it would always
amount to a creditor’s right – this decision is premised
upon idea that a real obligation must place a physical
burden upon owner’s entitlements of use and enjoyment.
Intention of the parties

6. Intention is of no consequence- clear that the intention
created a real right BUT the court was willing to override
that intention.
7. Court awarded the intention of the parties too little weight.

8. Additional requirement: real rights must place a physical
burden upon the owners entitlements of use and enjoyment.
68
Van der Walt A and Pienaar G Introduction to the Law of
Property JUTA: Cape Town (2016)- Chapters 3, page 38-40 Pearly Beach Trust v
Registrar of Deeds 1990 (4)
SA 614 (C)
• Lorentz decision was rejected and

subtraction from dominium test was
reinstated in its traditional
formulation, and it was decided that
some obligations to pay a sum of
money could in fact constitute limited
real rights.
• A condition in a deed of sale of land

(contract) provided that a certain 3rd
party was entitled to receive from
purchaser and his successors ⅓ of
consideration received if property
should be expropriated or if mining
rights should be granted over land.
Registrar of deeds refused to register
condition, arguing that it created a
creditor’s right and not a real right.
Pearly Beach Trust v
Registrar of Deeds 1990 (4)
SA 614 (C)
Application of subtraction test
• Ito Geldenhuys case - right created in this

contract would be a creditor’s right if it placed
an obligation upon a specific person in her
personal capacity, and a real right if it placed
an obligation upon a person as owner of
land, which was actually burdened with
obligation.
• In terms of Lorentz case, such a right could
never be a real right, since it did not restrict
owner’s right to use property physically, and
therefore it had to be a creditor’s right.
• In Pearly Beach Trust decision, court reverted
to traditional formulation of subtraction from
dominium test, and rejected Lorentz
approach and extra requirement of physical
restriction implied by it. Court decided that
condition in this case placed a burden upon
owner’s right to dispose of property and enjoy
full fruits of such disposal, and that this
burden rested upon land and not just on any
specific person. It was therefore a real right,
which could be registered.
 Pearly Beach Trust decision that an obligation to pay a sum of money to someone could
constitute a real right was criticised by various authors – most common criticism was
that obligations to pay someone a sum of money should never be treated as real rights,
since that might result in creation of too many unnecessary financial burdens upon
ownership of land (a situation which might have an adverse effect upon economy).
 As Pearly Beach Trust decision stands at moment, it might well be interpreted to imply
that real rights to payment of money can be created freely and registered against title
deed of land, and such a result will indeed have economic repercussions.
 However, it can be argued that intention of court in Pearly Beach Trust case was that
sum of money must be a direct product of land itself so that obligation to pay sum of
money to someone reduces owner’s benefit in use and enjoyment of land itself – this
qualification is never mentioned in decision as such, but can be inferred from court’s
application of subtraction from dominium test. If decision is read and applied in this
way, only certain obligations to pay money could create a real right which can be
registered against title to land.
 Denel case is more authoritative than others because it is a SCA decision, but case did
not concern payment of a sum of money at all and therefore did not bring about greater
clarity on this issue
71
In Pearly Beach decision, proper weight was attached to intention of parties, who
clearly intended to create a real right. What they intended was not contrary to law,
and therefore their intention was taken into account.
72
Pearly Beach Trust v Registrar of Deeds 1990 (4) SA 614 (C)
Summary
Crucial Facts:
• Rejected the Lorenz case- subtraction from dominium was reinstated in its traditional form
• Condition created in a contract but not yet registered.
• Condition created an obligation to pay someone;
• Those condition placed a burden upon the owner’s rights to disposal and enjoy the full fruits of
such disposal.
• Therefore because the condition created a burden on the land, real rights could be registered.

• Obligation to pay a sum of money to someone could constitute a real right was criticised by
various authors – most common criticism was that obligations to pay someone a sum of money
should never be treated as real rights, since that might result in creation of too many
unnecessary financial burdens upon ownership of land (a situation which might have an adverse
effect upon economy).

• Proper weight was attached to intention of parties, who clearly intended to create a real right.
What they intended was not contrary to law, and therefore their intention was taken into account.

• Court reverted to traditional formulation of subtraction from dominium test, and rejected Lorentz
approach and extra requirement of physical restriction implied by it. Court decided that condition
in this case placed a burden upon owner’s right to dispose of property and enjoy full fruits of
such disposal, and that this burden rested upon land and not just on any specific person. It was
therefore a real right, which could be registered
73
Position in case law isn’t entirely clear :
 Geldenhuys case (a decision of old Free

State court) – does not give a clear
answer to question as to whether an
obligation to pay money could ever
qualify as a real burden on land.
 Lorentz case (a decision of old Transvaal

court) – suggests that an obligation to
pay money could never establish a real
right.
 Pearly Beach case (a decision of old Cape

court) – suggests that an obligation to
pay money could establish a real right in
some cases.
74
Cape Explosive Works Ltd and
Another v Denel (Pty) Ltd and
Others 2001(3) SA 569 (SCA)
• There was a condition in a deed of sale that

limited use of property and linked impossibility
of performance in terms of use limitation to a
right of repurchase in favour of original seller.
• Rights at stake were created upon sale and

transfer of particular pieces of land to 2nd
respondent, Armscor. Sale was subject to
certain restrictions upon use of land :
• Armscor could use it only to manufacture
armaments (weapons)
• Once land was no longer required for this

particular purpose, Armscor would advise Cape
Explosive Works (CEW) that land was no longer
to be used as envisaged, and that CEW would
then have 1st right to repurchase land.
• Restrictive conditions in respect of smaller of

two pieces of land were cancelled by notarial
deed. 75
Cape Explosive Works Ltd and Another v Denel
(Pty) Ltd and Others 2001(3) SA 569 (SCA)
• In a transfer of larger of two pieces of

land from Armscor to Denel, conditions
were brought forward into new title
deed.
• However, in a subsequent consolidation

of the two pieces of land, second
restriction was omitted, and first
restriction was made applicable only to a
small portion of consolidated land, and
not to entire extent of land.
• In dispute that ensued between CEW and

Denel, Denel argued that land was
unencumbered by resale restriction.
CEW, on other hand, sought an order to
rectify title deed to include both
restrictions.
• Court a quo held that second restriction

was not registrable in terms of s 63(1) of
Deeds Registries Act. CEW appealed. 76
•SCA held that two restrictions should

have been carried forward into new title
documentation.
•Court attached great importance to

intention with which land was
transferred. It referred to requirement
that any transfer of ownership should
be accompanied by intention to transfer
and receive property at stake.
•Reading two clauses together (i.e. as

creating one restriction), court further
held that intention to bind successors
in title of Armscor appeared clearly
from original agreement. Because
provisions restricted use of property
by owner, court held that they
amounted to a subtraction from
dominium.
77
•Court further indicated :
o A real right is adequately

protected by its registration in
Deeds Office ... Once Capex’s
rights had been registered they
were maintainable against whole
world. They were not
extinguished by their erroneous
omission from subsequent title
deeds and fact that Denel's title
deed, registered in Deeds Office,
did not reflect those rights, does
not assist Denel.
78
Cape Explosive Works Ltd and Another v Denel (Pty) Ltd and Others
2001(3) SA 569 (SCA) - Summary
Crucial Facts:
1. Burden Placed on landowner included a physical burden (use and enjoyment) and non-
physical burden ( right of first refusal upon realisation of a certain condition).

2. Court was silent on this. Didi not deal with a condition that imposes a duty to pay someone.

3. Intention to create a real right was as important as the question as to whether the burden
was capable of registration.

4. Court confirmed the Lorenz position i.e. the restrictive formulation of the test.
NOTE: Denel case is more authoritative than others because it is a SCA decision, but case did
not concern payment of a sum of money at all and therefore did not bring about greater
clarity on this issue.
79
Cape Explosive Works Ltd and Another v Denel (Pty) Ltd and Others 2001(3) SA 569
(SCA) - Summary
See further reading regarding these cases:
The African Jurist: Determining the Distinction Between Real and Personal
Rights in a Roman Dutch law Jurisdiction like South Africa
Link: https://theafricanjurist.wordpress.com/2018/08/20/determining-the-distinction-
between-real-and-personal-rights-in-a-roman-dutch-law-jurisdiction-like-south-
africa/#:~:text=Property%20law%20distinguishes%20between
%20personal,creditor's%20rights%20and%20real%20rights).&text=A%20real
%20right%20will%20always,a%20right%20against%20a%20person. (Accessed on
11/03/2021
80
Principle of publicity and doctrine of notice
Remember that distinction between real and personal rights:

 holder of a real right may enforce that right against anyone i.e. ‘the world at large.’
 Real rights are enforceable even against 3rd parties who act in good faith and against parties
who, in good faith, acquire such rights for value.
 Because of the prejudice this may cause, it is desirable (even indispensable) that existence
of a real right as well as its content and identity of its holder should be made known, i.e.
publicised to world at large.
Publicity
For a real right in a thing to be transferred or newly created, transferee must know identity of
holder of real right as well as extent of that right. To advertise existence of a real right in
respect of land, its extent and scope, as well as identity of its holder, these facts must be made
known to world at large. This process is in accordance with publicity principle.
Publicity principle entails that outsiders should be able to deduce

from externally perceivable indications whether real rights in things
exist, and when transfer of a real right from one person to another
occurs i.e. it requires compatibility between legal and factual
situations.
With movables, publicity is served mainly by possession of thing and by delivery at transfer –
physical control of thing suggests a particular kind of real relationship between holder and
thing.
In context of land rights, publicity is achieved primarily by registering rights in respect of land
in a public office i.e. Deeds Registry. Since registry is open to public, anyone may access
records held in Deeds Registry, usually against payment of a small fee. Registration of title and
limited real rights thus eases burden on owner to prove her title.
Publicity principle is served further by requirements that combine changes in physical

control over things with changes in legal relationships that underlie such control e.g.
requirements regarding form of delivery for transfer of movables and registration
formalities for transfer of land are designed to optimise publicity of changed legal
relationship regarding the property concerned.
In turn, these requirements assist those persons who would rely on outward
manifestations of changed legal position, by reference to where possession of
movable lies or to records in Deeds Registry. Further inconvenient research to
establish state of affairs in matters relating to title to land or movables is
unnecessary.
NOTE : negative system of registration in SA makes complete reliance on registry

impossible.This is because our law favours the true owner of a thing rather than a
bona fide acquirer. Therefore in a negative sense, nobody can claim that he/she has
acquired ownership of land or a real right inland unless it is registered.
At any time, there may be real rights in existence or changes in ownership that have
occurred but which have not yet been registered. Also, fact that a person is in
physical control of movable property may not justify conclusion that he is also
holder of a real right in it since legal right to control its use may vest in someone
else.
There is a rebuttable presumption that person in physical control of movable property

is owner thereof, unless contrary is proved, makes such a conclusion reasonable in
many situations.
Whereas publicity value of physical control in case of movables may often be

uncertain, publicity is of paramount importance in respect of land rights. Since real
rights in respect of land are registered, every person is deemed to have knowledge of
real rights so registered in Deeds Registry – this is referred to as ‘doctrine of
constructive knowledge’.
Doctrine of constructive knowledge = because information is publicly available, one

cannot use ignorance of existence of a real right as an excuse to escape its
implications i.e. one is deemed to know of its existence. This doctrine protects both
registered owner as well as general public.
An owner’s burden of proof in respect of proving her title to land is eased in that production of
title deed is prima facie proof of title.
Also, because knowledge of register is constructive, any member of public is protected

within certain limits if reliance is placed on information in register.
Although it is said that doctrine of constructive knowledge renders real rights ‘enforceable
against world at large,’ it is incorrect to use this doctrine to justify enforceability of real
rights in this way. Converse is true : registration of real rights in land is one of requirements
of creation and transfer of such rights and has effect of advertising or announcing existence
of real right. Thus, it is fact that real right exists that makes it enforceable against 3rd parties.
However, registration cannot change nature of a right : it cannot convert a personal right into
a real right. In addition, erroneous omission of a previously registered real right from later
title deeds does not extinguish it nor change its status from real to personal.
Doctrine of notice
Although registration is usually a necessary element in creation

of a new real right in land, a holder of an unregistered real right
is also protected in certain circumstances – this protection
comes from maxim that ‘nobody may derive a benefit or
advantage from his own bad faith’ (nemo ex suo delicto
meliorem suam conditionem facere potest).
In property law, this means that no one may defeat another person's potential real right for
her own benefit if she knows of its existence – this is also referred to as ‘doctrine of notice’.
Doctrine of notice must not be confused with doctrine of constructive

knowledge. It operates to force acquirer of real right to give effect to
earlier personal rights that would have given rise to acquisition of a real
right. By contrast, doctrine of constructive knowledge operates to
accord knowledge of certain real relationships to parties dealing with
rights arising therefrom.
There are many examples in case law where doctrine of notice has been applied. Such
examples relate especially to instances where a purchaser acquires ownership of a
thing sold with certain knowledge :
 Where purchaser knows that thing has been sold previously to someone else
 Where purchaser knows that a predecessor in title has undertaken to grant a
servitude to owner of a dominant tenement
 Where purchaser has knowledge that he is acquiring thing contrary to an option or
right of pre-emption of someone else, or contrary to a prohibition of alienation
upon seller
 Where purchaser knows that a lessee has a right to occupy thing sold.
Knowledge of purchaser may also have to do with an earlier undertaking by a

predecessor in title to create a real security right over thing sold in favour of
predecessor's creditor.
Further examples of application of doctrine of notice relate to subsequent

successors in title with knowledge of a prior personal right, even when
predecessor in title had no knowledge of that personal right.
Doctrine has further been applied also to attachment of an asset of a judgment

debtor with a view to execution of judgment by a judgment creditor with
knowledge of a prior personal right of a previous purchaser in respect thereof
Generally, in all cases that concerned application of doctrine of notice, prior

personal right would lead to creation of a real right. This is why doctrine speaks
of ‘potential real right’.
NOTE : ordinary personal rights, i.e. those that could never lead to creation of a
real right, do not fall under doctrine of notice.
Doctrine of notice does not require proof of fraud, but merely knowledge of
prior personal right. Fraud may, however, be construed from such knowledge,
but rationale behind doctrine is protection of personal right against unlawful act
of acquirer of a real right.
Application of doctrine of notice is triggered by acquisition of real right with

required knowledge.
Also, doctrine may be applicable only in cases where real right was acquired against
payment of consideration.
Where a real right is acquired gratuitously (ex titulo lucrativo), acquirer has to
observe undertakings of her predecessor with regard to thing, even in absence of
knowledge on her part.
Three requirements must be met for doctrine of notice to apply :
1. Prior personal right must exist against holder of a real right

This does not mean that doctrine of notice is applicable to all kinds of personal
rights. It applies only to personal rights that would give rise to acquisition of thing
(iura in personam ad rem acquirendam).
2, A subsequent acquirer of real right, acquired after establishment of personal right,

must infringe upon personal right.
Infringement must amount to a wrongful action, which means that rules of delict are
applicable.
3, Acquirer of real right must know of existence of prior personal right.

‘Actual knowledge’ of prior personal right is required. Constructive knowledge is not
enough to activate doctrine. However, in circumstances where acquirer wilfully
closes his eyes to what is obvious, he might be deemed to have knowledge even if
he denies actual knowledge.
When is acquirer of real right expected to know of prior

personal right for doctrine to find application ?
There is some uncertainty on this point, in particular where there is a lapse of time
between contract and transfer of real right.
However, correct position = knowledge should exist at time of acquisition of real

right i.e. at time of transfer. Before transfer, acquirer has only a personal right (to
claim transfer). A dispute between two holders of personal rights would be solved
by application of prior in tempore rule (i.e. first in time, stronger in law).
Example
Arnold purchases a farm from Bert. Typically, some time passes between a
purchase of land and completion of required registration procedures in Deeds
Registry. After conclusion of contract for sale of farm, but before registration is
achieved, Arnold is informed by Cathy of existence of an unregistered right of
way in respect of land, and is requested to co-operate in having right registered.
May Arnold refuse to co-operate because he was unaware of unregistered

servitude at time of purchase ? Or would Cathy be able to rely on doctrine of
notice to compel Arnold to co-operate in registering servitude?
In our law, significance is attached to two
moments in process of acquiring a real right :
 1st : Point at which parties agree that property or right will change hands – this is moment
at which contract underlying acquisition of right is formed. Agreement can be a
sale or a donation or any other form of contract which demonstrates parties’
intention to give and receive transfer of property.
 2nd : Point at which property or right actually changes hands – this is moment of
transfer, which includes creation of real agreement and conveyance.
Two significant moments can overlap e.g. when I buy a loaf of bread from shop or
they can be separated in time e.g. where land is sold – a considerable
amount of time can pass between point at which parties agree that land be sold
and point at which transfer is registered in Deeds Registry.
Purchase of land – + Registration in

conclusion of Real agreement name of purchaser
contract of salw = transfer
Wahloo Sand Bpk v Trustees, Hambly Parker
Trust 2002 (2) SA 776 (SA)
Dispute arose because of creation of reciprocal servitudes by owners of

neighbouring properties, where one property was sold to another before
servitudes could be registered. Purchaser refused to consent to registration of
servitudes, arguing that he had no knowledge of agreement in terms of which
servitudes were created.
SCA held that lack of knowledge of a servitude created will only protect subsequent purchaser after
property has been registered in his name. While purchaser is not yet registered owner of land, lack
of knowledge of servitude cannot be a defence against claim by owner of dominant tenement for
specific performance.
Where purchaser of a thing acquires it with knowledge such as described above, doctrine of notice
is applied to force acquirer of real right to give effect to earlier personal rights.
Successive sales
Seller (Amanda) sells a thing, either

movable or immovable, 1st to Beth,
and then subsequently sells same
thing to Carl.
90
Practical explanation
Ownership will be acquired by purchaser who first obtains transfer of thing sold.
Transfer is effected either by delivery (movables) or registration (immovable).
If 1st purchaser (Beth) manages to obtain transfer first, her rights will be
unassailable. But if 2nd purchaser (Carl) manages to obtain transfer first, his rights
equally will be unassailable IF Carl had purchased thing without knowledge of
prior sale to Beth. If Carl had prior knowledge, Beth could claim that transfer to
Carl be set aside, and ownership of thing should be transferred to her instead.
Doctrine of notice thus operates to enable 1st purchaser who did not take transfer
(Beth) to claim that 2nd sale be cancelled, and to claim delivery or transfer of property
if it can be shown that 2nd purchaser (Carl) had knowledge of prior sale to 1st
purchaser.
Carl (2nd purchaser) may well be acting in good faith. He may not know of sale to
Beth when he contracts with Amanda. He may acquire knowledge of previous sale
only later (e.g. when an attempt is made to deliver thing). In such cases, 2nd
purchaser’s knowledge must be determined as at time when he takes delivery or, in
case of immovables, at time land is registered in his name.
Unregistered servitude
With unregistered servitudes, a typical example would be case where

servitude is created by agreement between two parties, Adam and Brett. If, in
terms of such an agreement, Adam becomes entitled to have a servitude
registered over land of Brett, Adam would have a personal right to claim that
registration be effected. Once registration has been completed, any
subsequent purchaser of land will automatically be bound by servitude as its
object is land itself and not merely a performance to be rendered by original
grantor (Brett).
Unregistered servitude
If, however, Brett should sell and transfer his land to Chris before registration of
servitude has occurred, Chris's knowledge or ignorance of Adam's potential
real right would become relevant. Object of Adam's personal right, flowing from
his agreement with Brett, is a performance to be rendered by Brett only, and not
land itself. Consequently, Chris would receive transfer of land free from any
servitude.
If he had no knowledge of unregistered servitude at time of transfer, he would not

be obliged to have a servitude registered over his land, and that would be end of
it. He would also not be expected to observe unregistered servitude.
However, if Chris had actual knowledge of Adam’s unregistered servitude at

time of registration of transfer, he will be bound by it notwithstanding that
servitude is not registered. Chris would then be compelled to co-operate in
having servitude registered.
Bowring NO v Vrededorp Properties CC and
Another 2007 (5) SA 391 (SCA)
Dispute concerned a double sale of a parcel of land

and registration of a servitude. It was not disputed that
2nd purchaser had knowledge of previous sale of a
subdivided portion of land concerned to Vrededorp.
Appellant disputed whether Vrededorp could claim
subdivision and transfer of portion directly from 2nd
purchaser (now registered owner) rather than from
transferor.
In other words, issue was whether contract between

transferor and Vrededorp (1st purchaser) should in
effect be enforceable against 2nd purchaser.
In considering whether registration of servitude

could be claimed from 2nd purchaser (now registered
owner), court first had to determine issue regarding
claim for transfer of subdivided portion. This is
because, unless that transfer could take place,
servitude would be a nullity on basis that a servitude
in respect of one's own property cannot exist.
94
Bowring NO v Vrededorp Properties CC and
Another 2007 (5) SA 391 (SCA)
• Both issues required application of doctrine of

notice :
o In relation to unregistered servitude
o In relation to successive sales
• On facts, court found that on basis of equity,

Vrededorp could claim subdivision and transfer of
portion directly from 2nd purchaser, and that
servitude must be registered with co-operation of
2nd purchaser
95
Any questions …
96

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Law of Property

HOWEVER, THE CONTENT TO THE POWER POINT SLIDES IS

It is your responsibility to build onto slides from the prescribed

No demarcations will be provided for any test, assessment or

Learning Units Prescribed material

LU 3 - Place in legal system

Patrimonial Law of Law of

Traditonally private law Traditonally not private law

Traditional law of things Aspects of constitutional law

References to law of obligations

References to commercial law

References to immaterial property law

Traditional law of things before Current law of property

Person Natural & Juristic person

Anything with regard to which a person can acquire and hold a

Everything which can form part of a person’s estate, including

Specific category of property, which is defined with reference

Legally recognised and valid claim by a subject to a certain

Creditor’s right / A right against a person - requiring some sort of eight

A claim or action is lawful when it is acknowledged and

Legal procedure provided by legal system to protect a

Learning Units Prescribed material

It is necessary to define rights in property more broadly than was done

Each characteristic will be unpacked below.

Non-physical types of property (i.e. incorporeal property / intangible interests in

The following subjective rights currently distinguished in

In case of composite things, object is composed of various components. It is

(d) Appropriability (subject to human control)

Sun, moon and stars will not qualify as things

Aspects of nature such as the sea and air we

(e) Use and value

Dangerous or unwanted objects (e.g. industrial or chemical waste) may also

Objectively evaluated, it could be valuable because it could be used as compost or in

All above items = assets and may act as

object of certain rights in terms of

doctrine of subjective rights.

Rights relating to assets in one’s estate = PATRIMONIAL rights

CLASS QUESTION: CAN YOU THINK OF ANY MOVEMENTS WITHIN OUR

 Things currently owned (res alicuius)

 Things that are currently owned may be

 Things that are unowned may be

 Things that have been lost (res

o Legislation has changed common law position in respect of many

These examples are all, simultaneously, examples of corporeal things.

A usufruct over contents of a home would thus be an incorporeal movable, while a

Some incorporeals will always be immovable because their object is immovable

Incorporeals recognised as movable include shares in a company, a member’s

• Modern SA law - suggested that such things should be classified as consumable

 That part which gives entity its identity or character

 Owner of principal thing is owner of composite thing, which includes accessory

 NOTE : Land is ALWAYS regarded as principal thing

This Photo by Unknown Author is licensed under

 An auxiliary thing is a thing which exists separately

 To identify an auxiliary, it must be evident that it is meant to be

 Example: key to a door, customised bar stools, seat covers

• Case provides a good example of

• Khan (applicant) was dispossessed of

• Accessories follow principal thing. It

• Court indicated that deciding which

• In this case, court found that thing that

• Court found that stolen rear end of built-up

• In this particular context, consideration

Learning Units Prescribed material