Law of Property Lecture Notes

Law of Property

W. AdamLaw of Property Lecture Notes

1Introducing the Concepts and Terminology (Lecture 1, 2)IntroductionObjectives: To understand where the law of property fits into the legal system; To understand where property rules come from; To be able to define terminology pertinent to the law of property.Scope and ContentLaw of property deals with the following: Rights, actions and relations of persons with regard to things and other forms of property; The ways in which property rights can be acquired, exercised lawfully; and South African Legal SystemPrivate LawLaw of ObligationsLaw of ThingsLaw of DelictLaw of ContractsRemedies by which these rights are protected against infringement and the legal results and implications.

The difference between the law of things and law of property is that property includes incorporeal assets whereas law of things does not. The Law of Property is mostly concerned with the private law sector where horizontal relationships between private individuals are concerned, but there is a public law component which deals with constitutional protection of property rights (section 25).The Law of property deals with real rights, intellectual property rights and other relationships to property (unlawful control of property).Background, Sources and current developmentSources of the Traditional Law of Thingsa. Roman Dutch Common Law (Grotius, Voet, Van der Linden) If common law did not provide a rule or if the context necessitates a deviation from common law because the common law was either outdated or non-suitable to the South African Contextb. Statutory Law (Sectional Titles Act 95 of 1986) used to enforce segregatory policyFor further explanation of how to apply the rule and to determine the scope and manner of application of the rulec. Precedent (Ex parte Geldenhuys (1926) (O), Setlogelo v Setlogelo (1914)(A))

1In order to facilitate the transition from a minority white racial hegemony towards a society based on democracy, social justice and fundamental human rights: Old discriminatory laws were abolished to be replaced by new democratic laws Existing legal system and its tradition, sources and background were re-evaluated.(Section 39(2) Constitution)Sources of current law of property since 1994a. Roman Dutch Common Law (Grotius, Voet, Van der Linden) If common law did not provide a rule or if the context necessitates a deviation from common law because the common law was either outdated or non-suitable to the South African Context, rule must be applied with consideration of whether it will promote or frustrate the ideals of human dignity, freedom and equality as protected by the Constitution.b. Statutory Law (Sectional Titles Act 95 of 1986) new laws must be evaluated against the Constitution (Constitutional Review)For further explanation of how to apply the rule and to determine the scope and manner of application of the rule and to determine whether certain decisions are outdated or incompatible with the social, political and legal developments.c. Precedent (Ex parte Geldenhuys (1926) (O), Setlogelo v Setlogelo (1914)(A)) old precedent informed by the spirit and law of apartheid can no longer be accepted as authority. (Minister of the Interior v Lockhat (1961) (A))d. Customary Law (Judicial notice given to certain rules of customary law) applied insofar as it is compatible with legislation dealing with customary law and the Constitutione. Constitution (The Bill of Rights) (s39(2), s8(1,3))

Things as legal objectsObjectives: To be able to define the relationship between property and things; To understand things by definition and characteristics; To understand how things are categorised and the purpose of such classification;Thing: a specific category of property that is a corporeal (sensorially observed and occupying a certain space) object outside of the human body (external) that is an independent (distinct and separate/measured, demarcated or contained) entity capable of being subjected to legal sovereignty (susceptible to control) by a legal subject for whom it has use and value (satisfies the needs of the legal subject objectively).Characteristics of a thing CorporealityAn entity that can be sensorially observed and it occupies a certain space (e.g. horse, motor bike, residential site, a cylinder with oxygen). Forces of nature are excluded in South African law as being corporeal entities, but this is not always the case in foreign legal systems.Exceptions: subjective rights recognised by statute or case law as things. 1Ben-Tovin b Ben-Tovin 2001 (CC) Principle: shares in a company which provide a shareholder with a claim against the company are incorporeal things. Badenhorst v Balju Pretoria Sentraal 1998 (T) Principle: membership interests in a close corporation is an incorporeal moveable thing. Graf v Buechel 2003 (SCA) Principle: loan account of a director of a company is an incorporeal thing. Telkom SA Ltd v Xsinet (Pty) Ltd 2003 (SCA) Principle: creditors right to the use of a telephone and bandwidth system installed on business premises is an incorporeal thing. External to humansA human being cannot be a legal object. Human corpses or parts of corpses may be classified as legal objects which fall outside of legal commerce. Parts of human bodies which can no longer be connected to a human being may be recognised as negotiable things (e.g. hair used to make a wig, human reproductive cells for the purposes of artificial reproduction, organs for the purposes of organ transplantation) subject to the Human Tissue Act 65 of 1983. IndependenceThe thing must be a definite and distinct entity that exists separately. 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 other gases become negotiable things when they are contained in cylinders. Immovable things come into being after demarcation on an approved and registered surveyors plan, diagram, aerial photograph or general plan (Deeds Registries Act 47 of 1937, Land Survey Act 8 of 1997). A building erected on land forms part of the immovable thing. A sectional title unit as immovable thing is described in terms of the registered sectional plan (Sectional Titles Act 95 of 1986).

Subject to juridical controlThings must be susceptible to juridical control. Heavenly bodies and other aspects of nature (such as the sea and air when unseparated) are not things.

Useful and valuable to humansNo legal relationship can exist between a corporeal thing and a legal subject if it is not useful and valuable objectively. It need not have economic value but may be of sentimental value (e.g. a dead leaf is objectively valuable because it may be used as compost or in a scientific study).

1Classification of Things Negotiable and non-negotiable: does it fall within legal commerce or not?Whether a thing is negotiable or not is determined by statute and case law. Singular and composite: Is it an independent object or is it composed of various components?Whether a thing is singular or composite is determined by the following test: Does the legal object exist independently without being composed of particular components?If it is a composite thing, the various components are identified as follows:Principal components: Exists independently Provides the composite thing with its identity (Khan v Minister of Law and Order 1991 (T))Accessory components: Exists independently but has merged or mixed to an extent that it has lost its independence. Is it physically and mechanically connected to the principal component in a way that they lose their independence (JL Cohen Motors (SWA) v Alberts 1985 (SWA))? Does not help to determine the composite thing's identity (Khan v Minister of Law and Order 1991 (T)). Is it a functional or economic part of the principal thing which enhances the usefulness of the principal thing. A broader criterion is suggested with regards to modern technological developments.Auxiliary components: Exists independently but which, because of its economic value, destination or use is no longer regarded as independent Things made of the same material as the principal thing and meant to be part of the principal thing are auxilliary things (Senekal v Roodt 1983 (T))Fruits: Produced by the principal thing without the latter being consumed or destroyed thereby. Before separation are accessory things to the principal thing, but are destined to be separated from the principal thing and to exist separately and independently. Natural fruits: organic and inorganic things which renew themselves.Hanging fruits: Frutus pendentesSeparated fruits: fructus separatiGathered fruits: fructus perceptiCivil fruits: fruits like rent, interest on capital, profit from an undertaking, dividends on shares.

Movable and immovable: Is it a unit of land or something permanently attached to land by means of accession, sectional title units or not?MovableImmovable

Transfer of OwnershipDelivery + IntentionRegistration in the Deeds Registry + Intention

ContractsAlienation: No Formalities.Credit agreements: Formalities of National Credit Act 35 of 2005.Alienation: Formalities of Alienation of Land Act 68 of 1981 and/or Property Time-sharing Control Act 75 of 1983 and/or Sectional Titles Act 95 of 1986.

Real SecurityPledge or registration of notarial bond.Registration of mortgages

Alienation of Minors belongings->R100k may be alienated or burdened by a parent or guardian only by order of High Court.