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Subdivision of agricultural land

14 July 2011

Section 3(a) of the Subdivision of Agricultural Land Act 70 of 1970 (hereinafter referred to as “the Act”) provides that, subject to exclusions contained in section 2 of the Act, agricultural land shall not be subdivided. However, section 3(e) of the Act provides that no portion of agricultural land, whether surveyed or not, shall be sold or advertized for sale.

The question begging an answer is whether the aforementioned section 3(a) and 3(e) must be interpreted distinct from one another, or whether they complement one another.

Sale is defined in the Act as to include a sale subject to a suspensive condition, and sold shall have a corresponding meaning. The Act does not provide a definition for “alienate” and one would perhaps have to revert to the Alienation of Land Act 68 of 1981 for an answer. The aforesaid Act defines alienate as to include donation and exchange, but can this definition be utilized for the Subdivision of Agricultural Land?

Was it the intention of the legislature to merely restrict section 3(e) to the sale of land and not include donations or exchange? Uncertainty prevails at present.

In Geue and Another v Van der Lith and Another2004 (3) SA 333 (SCA) the court held that if agricultural land is sold without consent of Minister of Agriculture, contrary to section 3(e)(i) of the Act, any suspensive condition that such consent be obtained does not avoid invalidity of the contract. The contract is thus void ab initio and Registrars of Deeds must check the date of sale and compare same with the date of issue of the consent to determine the validity of the transaction.

The court further held that it was clear from section 3(e)(i) of the Act that the legislature intended to prohibit any sale of a portion of farm land, whether conditional or not, unless subdivision had actually been approved by the Minister.

If one applies the provisions of section 3(a) and 3(e) distinct from one another, an owner of agricultural land would be able to donate or exchange a portion of agricultural land without prior approval from the Minister, and thus the deed of alienation can be made subject to a suspensive condition that such consent be obtained after conclusion of the contract.

 Your views please.

Reader Comments: 1
Mandi Hamman 03/08/2011:

See Westraad N.O. v Burger (5226/06)[2007] ZAFSHC 34 (13 April 2007) which refers to the Geue case. If the restrictive approach in this case is followed, options to purchase, exchanges and donations are excluded from the application of Section 3(e)(i) read with the definition of "sale" in Act 70 of 1970, and such agreements may be entered into subject to the Minister's consent being obtained afterwards.

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