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Subject to ties - III

24 June 2010

In response to Subject to ties II ("the article"), I think special regard must be had to section 4 (2) (a) of the Subdivision of Agricultural Land Act 70 of 1970 ("the SAL Act"), in terms of which "The Minister may in his discretion refuse or - on such conditions, including conditions as to the purpose for or manner in which the land in question may be used, as he deems fit, grant such an application" (emphasis added). I have no doubt, therefore, that this wide discretion is intended to enable the Minister to ensure the maximum achievement of the objects of the SAL Act.

Special regard must be had, also, to the fact that (a) the sub-division of agricultural land is but one of the actions that are prohibited by section 3 of the SAL Act, (b) "the usual Minister's condition" ("the condition"), which is cited in the third paragraph of Subject to ties, (i) applies only to a property that is, or properties that are, tied to another property and (ii) prohibits the said property's or properties' being sold, alienated, mortgaged or in any other way dealt with separately without the Minister's consent, and (c) mortgage, in particular, is not prohibited by section 3 of the SAL Act.

It must be appreciated that, notwithstanding the fact that both of them are not prohibited by section 3 of the SAL Act, the Minister is entitled, in the exercise of his/her discretion, to prohibit, in terms of the condition, a separate mortgage or consolidation of the aforesaid property or properties - a prohibition of a separate consolidation in the condition and a non-prohibition of a consolidation in section 3 of the SAL Act are not contradictory. In the circumstances, an attack on a consolidation should entail an attack on mortgage.

Since a certificate of registered title and a certificate of consolidated title, issued in terms of sections 43 (1) and 40 (1), respectively, of the DRA, are substituted title deeds and if it is accepted that a restriction on the right to sub-divide land is a restriction on the exercise of the right of ownership, as contemplated in section 63 (1) of the Deeds Registries Act, 1937, (Act No. 47 of 1937), as amended, ("the DRA"), I submit that a restriction on the right to consolidate the property or properties referred to in the condition should qualify similarly or equally. Actually, a restriction on consolidation can be more detrimental than a restriction on sub-division.

In the third paragraph of Subject to ties II,Mr Lee makes the observation that the issues raised by Mr Newmarch (refer to the second part of Subject to ties - a response) "may prevent the issue of a certificate of title, not because of the land being dealt with in the sense of being burdened or being alienated in any fashion, but to prevent other, undesirable results". It must be stated that it is equally true that the said issues may prevent the issue of a certificate of title "because of the land being dealt with in the sense of being burdened or being alienated in any fashion" also. As argued in the fourth paragraph hereof, there is no doubt that a prohibition on the issue of a certificate of consolidated title is the registrable condition contemplated in section 6 (2) of the SAL Act read with section 63 (1) of the DRA and that the prohibition would not have been imposed if it was not intended to prevent an undesirable result.

As a matter of course, opinions do differ on the interpretation of the condition. That is a difficult and complex issue. The fact is that, according to the third paragraph of Subject to ties a certificate of consolidated title is considered by the Deeds Office and the Department of Agriculture to be included in the condition. Be that as it may, suffice it to say that, there is no doubt in my mind that the words "or otherwise dealing with" "deal with" or dealt therewith", for example, in sections 31 (6) (b), 45 (1), 45bis (1) and 45bis (1A), and Regulation 65 (4) of the DRA - refer to Subject to ties - a response- includes the restrictions contemplated in section 63 (1) of the DRA.

In response to the question raised in the fourth paragraph of the article, I clarify that I refer to any certificate of registered title issued in terms of the DRA provided, however, that such certificate is for the property or properties referred to in the third paragraph of Subject to ties - refer, for example, to Chief Registrar's Circular Nos. 1 of 1980 and 8 of 1986 also.

On the basis of the afore-going, I am unable to agree to the statement in the last paragraph of the article, that the words "….or in any other manner deal…" are "a little rider". On the contrary, in my opinion, the words are a drag-net clause.

Thabo Nqhome
23 June 2010


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