Deeds Registries Amendment Bill, Sectional Title Amendment Bill: adoption

SELECT COMMITTEE ON LAND AND ENVIRONMENTAL AFFAIRS
13 June 2006
DEEDS REGISTRIES AMENDMENT BILL, SECTIONAL TITLE AMENDMENT BILL: ADOPTION

Chairperson: Reverend P Moatshe (ANC, North West)

Documents handed out:
Sectional Titles Amendment Bill [B8-2006]
Deeds Registries Amendment Bill [B5-2006]
Summary and Analysis of the Deeds Registries Amendment Bill

SUMMARY
The Committee was briefed on the Deeds Registries Amendment Bill and the Sectional Titles Amendment Bill. It was emphasised that the purpose of the Deeds Registries Amendment Bill was to provide for the registration of rights which had been acquired in terms of the Black Administration Act, and which would be particularly vulnerable after 31 July 2006. After rasing some questions of clarity, the Committee adopted both Bills without further changes.

MINUTES

Briefing by the Department of Land Affairs
Mr J Havenga briefed the Committee on the Deeds Registries Amendment Bill. He emphasised the need for the proposed amendments to continue the registrability of rights which emanate from the Black Administration Act. The Department proposed that a new paragraph should be included in the Deeds Registries Act which would allow the Registrar of Deeds to continue to register any registrable transactions concerning a right which had originally been acquired in terms of the Black Administration Act. The proposed paragraph will also allow the Registrar of Deeds in terms of subparagraph 2, to exercise all other powers and duties vested in or imposed upon a Chief Commissioner or registration officer under the Black Administration Act. The sole purpose of the provision is to provide for the technical registration of these rights.

Clause 2 of the Bill is a consequential amendment, which relates to the registration procedure which will be carried out in terms of the old provisions. The problem is that the Deeds Registries Act did not have any provisions, in terms of which the Registrar of Deeds can register these transactions. The proposed amendments aim to fulfill a temporary gap, which will exist after 31 July 2006. It was further said that these provisions would not be applied when townships become fully upgraded, as a result of which people will then have full rights.

Discussion

Mr M Mzizi (IFP, Gauteng) commented that there are certain provisions of the Black Administration Act, which cannot be repealed because of the administration, which was still in place, and therefore fully supports that the proposed provision should fill the gap.

Ms M Oliphant (ANC, KwaZulu-Natal) referring to an opinion by the State Law Advisor that the Bill need not be referred to the National House of Traditional Leaders, asked for elaboration.

Ms Chetty, the Parliamentary Legal Officer at the Department of Land Affairs, responded that originally it had been the opinion of the State Law Advisors that the Bill should be referred to the National House of Traditional Leaders. However, a second opinion was sought and the revised opinion of the state law advisors was that it did not need to be referred to the National House of Traditional Leaders.

The Chairperson proceeded to read the motion of desirability, which was to amend the Deeds Registries Act, 1937 so as to provide for the continued registration of registrable transactions concerning rights acquired in terms of or under the Black Administration Act, 1927 or proclamations, regulations or by-laws under the latter Act despite its repeal, and to provide for matters connected therewith. Members agreed to this motion.

Presentation by Chief Registrar of Deeds

Mr Sam Lefafa, the Chief Registrar, made the following comments on the Sectional Titles Amendment Bill. Clause 1 of the Bill sought to address uncertainty about short term leases. The purpose of the proposed amendments in terms of Clause 1 is to clarify the position that a sectional mortgage bond may only be registered in terms of long term leases, which is not less than 10 years. The current position exists that a sectional mortgage bond can be registered over a portion of a scheme; however no provision has been made for a mortgage bond to be registered over an exclusive use area and therefore the amendment proposed by Clause 1 makes provision for this.

Clause 1 also addresses the definition of Surveyor General which refers to the latter having been appointed in terms of the 1927 Act. The proposed amendment seeks to rectify this and to update the definition in terms of the 1997 Act.

Clause 2 seeks to amend Section 15B of the Act, which provides for the registration of certificates of sectional title in respect of a joint owner’s share in a unit. The clause addresses the issue of a separate title deed in respect of a joint owner’s share in a unit. It was said that Section 15B(iii) did not provide for the registration of a sectional title deed in respect of a joint owner’s share in an exclusive use area or a right in terms of Section 25 (1) of the Act. The joint owner of an exclusive use area or a real right reserved under Section 25 (1) was therefore not in a position to obtain a separate title deed for his or her undivided share. The amendment would make it possible for a joint owner to obtain a separate title deed for his or her undivided share.

Clause 3 of the Bill seeks to amend Section 26 of the Act, which empowers the Body Corporate to only purchase property. The Act does not provide for the acquisition of land in any other manner. The proposed amendment therefore seeks to empower the Body Corporate to acquire land in other ways.

Clause 4 seeks to amend Section 36 of the Act. The proviso to Section 36 (2) refers to a lease of a unit contemplated by paragraph (b) of the original definition of “owner”, which has since been amended. However the proviso to Section 36(2) has not been amended accordingly and the amendment seeks to delete this proviso.

Discussion

Mr Mzizi sought further clarity on exclusive use areas.

Mr Ogunronbi (Deeds Office) replied that in every sectional title scheme there is an exclusive use area which is not part of the main unit and can be designated to be used for the use of a particular member. Common property includes swimming pools, driveways that are owned by everybody and areas where everyone has the right to use which is not designated for any particular member. Clause 2 of the amendment bill proposes that when there are joint owners over a unit, they are able to take out separate title deeds in respect of that exclusive use area.

Mr Lefafa went on to give an example of how a sectional title deed differs from an ordinary title deed. Once a sectional title development is registered, the land becomes common property in terms of which a scheme is developed. An exclusive area refers to a particular section of the property, which has been designated to a particular owner in respect of a particular section for that owner’s exclusive use.

Mr A Watson (DA, Mpumalanga) stated that his concern was around legislation which is available for registration purposes; however there needs to be legislation regarding deregistration as well. He gave an example where the Body Corporate buys or obtains one of the sections. In terms of the new legislation this can be registered as part of the common property. What happens in the event that the Body Corporate decides to sell this section to another participant in terms of deregistration?

Mr Mzizi further raised concerns where a donation is made to the Body Corporate, or a unit is bequeathed after death. Is there a provision which provides that the beneficiary may sell it to the highest bidder other than the Body Corporate?

Mr Ogunronbi replied that Section 26 of the Act provides for this. What is being amended only refers to acquisition and purchase for purpose of expanding the common property. The acquisition of a flat for example would have to be for the purpose of expansion of the common property.

The Committee adopted the proposed Sectional Titles Amendment Bill.

Adoption of Minutes

Members adopted the minutes of 9 May 2006, but did not adopt the minutes of 26 May 2006, as there were inconsistencies that they wanted to clarify at another scheduled meeting.

The meeting was adjourned.

















Mr Watson referring to section 3 expressed concern that the Body Corporate would now be able in any other way even purchase a portion within the Body’s Corporate area of jurisdiction. It was asked where the Body Corporate was entitled to sell such areas for the benefit of exclusive use areas. The member gave a scenario where a Body Corporate inherits a unit from a person who dies, which will in effect give the Body Corporate the power to register this property. The question asked was what would happen in the event that the Body Corporate intends to sell this unit or property, and whether this was covered in terms of the legislation.