Fact or fiction? - II

30 April 2009

I refer to the questions posed by Allen West in Fact or fiction? In my opinion, if it is viewed against the provisions of section 3 (1) (y) of the Deeds Registries Act, 1937 (Act No. 47 of 1937) as amended, ("the DRA"), there is nothing in the order granted by the Court in the Prophitius case that impacts negatively on the notion that "South Africa has one of the best land registration systems in the world, if not the best". In the said case, and, as envisaged in section 6 (1) of the DRA, the Court set aside the simultaneous transfer of the property in question by two Deeds of Transfer.

What is abundantly clear from the facts in the Prophitius case is that, amongst other factors, having registered a transfer of the property from the seller to one purchaser from a Regulation 68 (1) copy of the title deed, the Deeds Registry registered another transfer of the same property by the same seller to another purchaser from the original title deed.

The burning question is how the checks and balances in the Deeds Registry failed to prevent the second and fraudulent transfer of the same property, since, ordinarily, withdrawals from a bank account should reduce or deplete the balance on the bank account regardless of whether the client makes use of a recently issued bank card or a bank card which had previously been reported to have been lost.

Section 3 (1) (y) of the DRA provides that a Registrar of Deeds "shall, subject to the provisions of this Act - keep, whether by means of a computer or in any other manner or by means of a computer and in any other manner, such registers containing such particulars as are necessary for the purpose of carrying out the provisions of this Act or any other law and of maintaining an efficient system of registration calculated to afford security of title and ready reference to any registered deed". (my emphasis). Therefore, the duty to afford security of title has, by law, been assigned to a Registrar of Deeds.

Section 6 (1) of the DRA, provides that: "Save as is otherwise provided in this Act or in any other law no registered …..deed of transfer…………shall be cancelled by a registrar except upon an order of Court."

Section 25 (1) of the Constitution of the Republic of South Africa, 1996, ("the Constitution") provides that: "No one may be deprived of property except in terms of law of general application and no law may permit arbitrary deprivation of property." (my emphasis).

Section 25 (6) of the Constitution provides that: "A person or community whose tenure of land is legally insecure as a result of past racially discriminatory laws or practices is entitled, to the extent provided by an Act of Parliament, either to tenure which is legally secure or to comparable redress." (my emphasis).

Section 39 (3) of the Constitution provides that: "The Bill of Rights does not deny the existence of any other rights or freedoms that are recognised or conferred by common law, customary law or legislation, to the extent that they are consistent with the Bill."

It is clear from the afore-going that the application of the common law principle of qui prior est tempore potior est jure by the Court of law in the Prophitius case cannot properly be viewed as a subtraction from the notion of security of title to land or as inconsistent with the Constitution.

Although shortcomings by a Deeds Registry do not augur well for the notion of security of title, it is noteworthy that errors in registration are recognised in legislation - refer, for example, to section 39 of the DRA, which deals with the issue of a certificate of registered title if "by reason of an error the same land has been registered in the names of different persons" and a discussion of "the fat is in the fire" and the "registration entanglement" under "II RECTIFICATION TRANSFERS" on page 388 of the fourth edition of Jones Conveyancing in South Africa.

Finally I deal with the question, how the Deeds Registry records would be amended to give effect to the Court order, since section 6 (2) of the DRA does not apply. I refer to Registrars' Conference Resolutions 4 of 1966 and 7 of 2003, in terms of which "an order (whether permissive or peremptory) may be given effect to by way of an endorsement without any overt act by the owner or by factual endorsement."

Thabo Nqhome
28 April 2009

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