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Townships Ordinance

9 February 2012

Introduction
The application for town planning is initiated when a prospective developer, being the owner of a farm, applies for township establishment. Once application is made for township establishment, the dealing with such land falls under the ambit of the Town Planning and Townships Ordinance 15 of 1986 (hereinafter referred to as “the Ordinance”).

Once all the requirements of section 79 of the Ordinance have been met, the township is declared an approved township in terms of section 103. The proclamation notice, after publication, will be lodged with the registrar of deeds and filed on the relevant township file.

The Ordinance provides for certain prohibitive measures with regard to the land on which the township is to be established and the proposed erven in the township until such time as certain requirements are met. These prohibitions will now be looked at in more detail.

Prohibition of the Sale of Land in a Township
From a conveyancing perspective the provisions of section 67 of the Ordinance is of the utmost importance as it provides that a contract entered into in contravention thereto is ab initio void and any person contravening the section shall be guilty of an offence.

Section 67(1) to (4) reads as follows:

 “67(1) After an owner of land has taken steps to establish a township on his land, no person shall, subject to the provisions of section 70 –

      (a)    enter into any contract for the sale, exchange or alienation or disposal in any other manner of an erf in the township;

      (b)   grant an option to purchase or otherwise acquire an erf in the township, until such time as the township is declared an approved township: Provided that the provisions of this subsection shall not be construed as   prohibiting any person from purchasing land on which he wishes to establish a township subject to a condition that upon the declaration of the township as an approved township, one or more of the erven therein will be transferred to the seller.

(2) Any contract entered into in conflict with the provisions of subsection (1) shall be of no force and effect.

(3) Any person who contravenes or fails to comply with subsection (1) shall be guilty of an offence.

(4) For the purposes of subsection (1) –

    (a)          “steps” includes steps preceding an application in terms of section 69(1) or 96(1).

   (b)          “any contract” includes a contract which is subject to any condition, including a suspensive condition.”

From the above section, it is clear that the contract entered into prior to the township being declared as an approved township in the Provincial Gazette, in terms of section 103 of the Ordinance, is null and void.

There are, however, exceptions to this prohibition, the one being the purchase of land for purposes of establishing a township, on condition that the township developer (purchaser of the land) will, on approval of the township, transfer certain erven in the township to the seller of the land.  A further exception is contained in section 70 of the Ordinance the relevant subsections which reads as follows:

70 (1) After an owner of land has applied in terms of section 69(1) to establish a township, he may apply to the director for consent to enter into any contract contemplated in section 67(1) or to grant any option contemplated in the latter section, and the Director may-

      (a)          in the case where the owner applied to establish a residential township, in consultation with the local authority concerned;

     (b)          in any other case, in his discretion,

consent to the entering into of such contract or the granting of such option subject to any condition the Director may deem expedient, and thereupon the Director shall notify the owner and, where applicable, the local authority in writing thereof and of any condition imposed.

(2) On receipt of a notice contemplated in subsection (1) the applicant shall, before entering into the contract or granting the option, but within a period of 6 months from the date of the consent, furnish to the local authority a guarantee of such type and for such amount as the local authority may determine and which is otherwise to its satisfaction that he will fulfill his duties in respect of the engineering services contemplated in Chapter V, and if he fails to do so the consent shall lapse.

(3) A determination by a local authority in terms of subsection (2) shall not be subject an appeal in terms of section 124.

(4) Where the Director has, in terms of subsection (1), consented to the entering into of a contract or the granting of an option, the contract or option shall contain a clause stating that the township concerned is not an approved township.

(5) Where a contract or option contemplated in subsection (4) does not contain the clause contemplated in subsection, the contract or option shall, at any time before the township is declared an approved township, be voidable at the instance of any party to the contract or option, other than the person who alienates or disposes of the erf or who grants the option.

(6) Any person who alienates or disposes of an erf and who enters into a contract contemplated in subsection (4) or grants an option contemplated in that subsection which does not contain the clause contemplated therein shall be guilty of an offence.”

Prohibition of the Transfer of Land in a Township
Before an erf in a township can be transferred by the township owner, such township owner must have been declared an approved township in terms of section 103 of the Ordinance, and the following provisions of section 82 of the Ordinance complied with, i.e:

  • that the Director has notified the Registrar in writing that any condition set out in the schedule contemplated in section 79, other than a condition requiring the transfer of land or the payment of an endowment in cash to the State or a local authority, has not been complied with;
  •  that until such time as-
    • the provisions of section 81 in respect of the transfer of land to the State or a local authority have been complied with, where any condition set out in the schedule contemplated in section 79 requires such transfer; 
    • the Director or the local authority has notified the Registrar in writing that the provisions of section 81 in respect of the payment of an endowment in cash to the State or a local authority have been complied with, where any condition set out in the schedule contemplated in section 79 requires such payment;
    • the local authority within whose area of jurisdiction the township is situated has certified that it will, within a period of 3 months from the date of the certificate, be able to provide the erf with such services as it may deem necessary and that it is prepared to consider an application for the approval of a building plan in respect of the erf.

The provisions of section 82 apply mutatis mutandis to the mortgaging of an erf in a township. However, where the whole of the township is transferred or mortgaged, the provisions of section 82 are not peremptory.

Transfer of Land on Which a Township is to be Established
Where the ownership of land in respect of which an application for the establishment of a township has been made, has changed and the new owner of such land notifies the Premier in writing that he wishes to continue with the application, the Premier may, if the application has not lapsed, consent to the continuation of the application subject to any condition he/she may deem expedient. An owner who continues with an application in accordance with the provisions of subsection (1) shall, for the purposes of the provisions of this Chapter, be deemed to be the applicant (see section 78 of the Ordinance).

Prohibition to Deal With Land, Pending Declaration as an Approved Township
Once a Registrar of Deeds has opened the township register in terms of section 46 of the Deeds Registries Act 47 of 1937, no transactions in respect of any land situated in such township may be registered until such time as the township is declared an approved township in terms of section 103 of the Ordinance.

Conclusion
Practitioners must take cognizance of the provisions and sanctions provided for in above referred to sections as the non-compliance thereof can have dire consequences for their clients.

Allen West
Deeds Training
Pretoria

Reader Comments: 1
Marius de Jager 10/02/2012:

This is a Transvaal Ordinnance and is thus not applicable to the Western Cape, where subdivisions are dealt with i t o Ordinnance 15/1985. The Cape Procedure is very much simpler and equally effective.

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