What does the Deeds Office do?

A4The Deeds Office is responsible for the registration, management and maintenance of the property registry of South Africa. If you are planning on buying a house, it can be useful knowing about the Deeds Office. However, you would use the services of a conveyancer when buying or selling a house. Your estate agent should be able to recommend a conveyancing attorney to register your home loan and transfer a property into your name.

What is conveyancing?

Conveyancing is the legal term for the process whereby a person, company, close corporation or trust becomes the registered and legal owner of immovable property and ensures that this ownership cannot be challenged. It also covers the process of the registration of mortgages.

Steps taken by the conveyancer:

  1. The conveyancer lodges your title deed and other documents in the Deeds Office for registration. These documents will be individually captured on the system. If there is a bond, the conveyancer dealing with the bond will lodge the bond documents with the Deeds Office at the same time as the transfer documents. The transfer, bond and cancellation documents must be lodged in the Deeds Office at the same time to ensure simultaneous registration. If different conveyancers are dealing with registering the purchaser’s bond and cancelling the seller’s bond, then they will need to collaborate.
  2. The Deeds Office examiners go through the documentation that has been submitted, and make sure that it complies with the relevant laws and legislations.
  3. The examiners then inform the conveyancer that the deeds are ready to be registered.
  4. Registration takes place with the conveyancer and Registrar of Deeds present. The transfer of the property is then registered in the purchaser’s name. If there is a bond, it is registered at the same time.
  5. Upon registration, the purchaser becomes the lawful owner of the property. The title deed that reflects this ownership is given to the conveyancer by the deeds office after the registration. Unless a bond has been registered as well, in which case the title deed is given to the bond holder.

The time taken to register a property at the Deeds Office depends on various factors and a number of parties. On average, registering a property transfer takes six to eight weeks, although unforeseen difficulties can cause the period to be extended.

References:

This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice. Errors and omissions excepted (E&OE)

The Consumer Protection Act and your rights

A3The South African Consumer Protection Act, No. 68 of 2008 was signed on 24 April 2009 and the purpose of the Act is to protect the interests of all consumers, ensure accessible, transparent and efficient redress for consumers who are subjected to abuse or exploitation in the marketplace and also to give effect to internationally recognised consumer rights. The Consumer Protection Act define a consumer as any person to whom goods and services are marketed, who is a user of the supplier’s goods, enters into a transaction with the supplier or service provider of any services and products.

If you have a complaint and the supplier won’t resolve it for you, you can complain to your provincial Consumer Affairs Office or the National Consumer Commission as well as other bodies.

The Consumer Protection Act:

  1. ensures that you are treated as an equal and protects you against discrimination in economic transactions.
  2. protects your privacy and ensures fair practice when goods or services are marketed to you.
  3. means you have the right to choose the agreements you enter into and continue with.
  4. gives you the right to the disclosure of information so that you can make informed choices.
  5. protects you against fraud and other dishonest practices.
  6. makes sure that you don’t have to agree to unfair conditions in the small print.
  7. allows you to return things which don’t work properly.
  8. protects you against goods and services that can harm you.
  9. makes suppliers compensate you if they have caused you a loss.
  10. ensures that you are educated on consumer issues and the results of your choices.
  11. makes it possible for you to form groups to promote your interests.

The Consumer Protection Act can help consumers in dealings which involve advertising, marketing, promoting, selling, supplying and delivering or repairing of goods and services in South Africa.

You are a consumer if you have made a deal with a supplier, for example, when you pay for goods or services, or if goods or services are marketed to you.

Goods include things, but also information and data and the licence to use it. Services include receiving advice or training you pay for, transport of people or goods, transactions at restaurants and hotels, entertainment and access to electronic communication. Employment relationships, credit agreements, deals between two private consumers and goods or services supplied to government do not fall under the Consumer Protection Act.

References:

This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice. Errors and omissions excepted (E&OE)

How does inheritance work?

A2When someone dies they normally have what is called a ‘will’. The people who benefit from this ‘will’ are known as the heirs. Upon someone death, the heirs receive an ‘inheritance’. The person who administers the will of the deceased is called an ‘executor’.

What legislation affects inheritances?

South Africa’s inheritance laws apply to every person who owns property in South Africa.

The three main statutes governing inheritances in South Africa are:

  1. The Administration of Estates Act, which regulates the disposal of the deceased’s estates in South Africa;
  2. The Wills Act, which affects all testators with property in South Africa;
  3. The Intestate Succession Act, which governs the devolution of estates for all deceased persons who have property in the Republic and who die without a will.

All property located in South Africa is subject to these laws, and there are no separate laws for foreigners. Immoveable property is not treated any differently to other types of moveable assets for inheritance purposes. Inheritance issues of foreigners and South African citizens are primarily dealt with by the Master of the High Court; however, if a dispute arises, then the case can be heard in any High Court of South Africa.

Foreigners who acquire immovable property in South Africa through purchase or inheritance must register their transfer of ownership by registering a deed of transfer with the Registrar of Deeds in whose area the property is situated. The process of registering a deed of transfer is carried out by a conveyancer, or specialised lawyer, who acts upon a power of attorney granted by the owner of the property.

Tax and inheritance

In South Africa, there is no tax payable by the heirs who get an inheritance. Capital Gains Tax (CGT) is also not payable by the recipient of an inheritance. Estate Duty and CGT, where applicable, are usually payable by the estate. If it is a foreign estate, it will be subject to the taxes of its country of origin.

What about donations or gifts?

Donations and gifts are treated differently to inheritance. For individuals, donations are subject to a Donations Tax of 20%, with an annual exemption of up to R100,000 of the value of all donations made during the tax year.

  • Non-residents are not subject to Donations Tax. However, in cases where the resident donor transfers his property to a non-resident (donee), and the resident donor fails to pay the Donations Tax, the non-resident (donee) and the resident (donor) will be jointly and severally liable for the tax.
  • Donations between spouses are exempt from Donations Tax, as are donations made to certain public benefit organisations.

Reference

This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice. Errors and omissions excepted (E&OE)

Antenuptial contracts: With or without the accrual system?

A1_If you don’t have an ANC, you are automatically married in community of property. This means that there is one estate between a husband and a wife. Everything is shared equally between spouses, which includes debts. However, with an antenuptial contract, the estates of each spouse remain separate. The difference comes with the addition of the accrual system.

What is an antenuptial contract?

An ANC determines whether a marriage will be out of community of property with/without the accrual system. It must be signed by the persons entering into a marriage, two witnesses and a notary public, and it must be registered in the Deeds Registries office within the prescribed time period.

What is the accrual system?

The accrual system is a formula that is used to calculate how much the spouse with the larger estate must pay the smaller estate if the marriage comes to an end through death or divorce. Only property acquired during the marriage can be considered when calculating the accrual.

  • If there is no accrual system, then the spouses have their own estates which contain property and debts acquired prior to and during the marriage – nothing is shared.
  • The underlying philosophy of the accrual system is that each spouse is entitled to take out the asset value that he or she brought into the marriage, and then they share what they have built up together.
  • The accrual system only applies if the marriage ends – either by divorce or death. You cannot claim your share of the joint estate while you’re still married.

Whether or not you decide to include the accrual system in your antenuptial contract depends on the couple. Some may see the relevance while others do not.

It’s important that both of you consult the lawyer who’s drawing up the ANC because both spouses need to be fully aware of the consequences. It’s also important to see someone who’s neutral, and who can mediate what goes into your ANC, because emotions can cloud your judgment, and it can be a stressful negotiation if one spouse has a lot of assets and the other doesn’t, for example.

References:

This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice. Errors and omissions excepted (E&OE)

New requirements to re-instate a company or close corporation

B4A company or close corporation may be deregistered upon request from the company or close corporation or any other third party. A company or close corporation may also be re-instated. However, since the withdrawal of Practice Note 6 of 2008, and its replacement with Notice 08 of 2017, there are new requirements for the re-instatement.

The Practice Note is issued in terms of Regulation 4(2)(b) of the Companies Regulations, 2011, and is applicable to the re-instatement of companies and close corporations in terms of Companies Regulation 40(6) and (7).

What are the new requirements?

Since December 2016, to re-instate a company or close corporation, the re-instatement application on a form CoR40.5 must comply with the following requirements regardless of the cause or date of deregistration:

  • Certified identity copy of the applicant;
  • Certified identity copy of the owner of the customer code;
  • Multiple deed search (deed search of each of the 10 regional deeds offices);
  • Letter from the Department of Public Works, only if the multiple deed search reflects immovable property;
  • Sufficient documentary proof indicating that the company or close corporation was in business or that it had any outstanding assets or liabilities, at the time of deregistration;
  • Mandate from the applicant confirming that the customer may submit on his/her behalf.

When can a company or close corporation be re-instated?

CIPC will only consider re-instating a company or close corporation if it can provide proof that it was conducting business at the time of deregistration, or has any other economic value. Furthermore, upon the successful processing of the re-instatement application, all outstanding annual returns must be filed in order to complete the process, within 30 business days from date of the re-instatement.

Reference:

  • Companies and Intellectual Property Commission | CIPC. Practice Note 08 of 2017, Requirements for re-instatement in terms of Regulations 4(2)(b).

This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice. Errors and omissions excepted (E&OE). 

Sectional titles: What is the role of the
body corporate?

B3When it comes to sectional title schemes, there is still widespread misunderstanding of even the basics, starting with the body corporate and how it is established, as well as what its functions and powers are. This misunderstanding often gives rise to many problems and disputes in sectional title schemes which could quite easily have been avoided.

What is a sectional title?

A Sectional Title Development Scheme, usually referred to as a “scheme”, provides for separate ownership of a property, by individuals. These schemes fall under the control of the Sectional Titles Act, which came into effect on 1 June 1988.

When you buy a property that’s part of a scheme, you own the inside of the property i.e. the space contained by the inner walls, ceilings & floors of the unit. You are entitled to paint or decorate or undertake alterations as desired, providing such alterations do not infringe on municipal by-laws.

What is the body corporate?

The Body Corporate is the collective name given to all the owners of units in a scheme. Units usually refers to the townhouses or flats in a development. The body corporate comes into existence as soon as the developer of the scheme transfers a unit to a new owner. This means that all registered owners of units in a scheme are members of the Body Corporate.

  1. The Body Corporate controls and runs the Scheme.
  2. Day-to-day administration of the Scheme is vested in trustees who are appointed by the Body Corporate.
  3. Major decisions regarding the Scheme are made by the Body Corporate, usually at the annual general meeting (AGM), or at a special general meeting (SGM). At these meetings, matters, which affect the Scheme, are discussed, budgets are approved, rules can be changed and trustees are appointed. Each member of a Body Corporate is entitled to vote at these meetings, providing that the member is not in arrears with levy payments or in serious breach of the rules.

The Body Corporate exists to manage and administer the land and buildings in the scheme. This means, that the Body Corporate is required to enforce the legislation and rules in the Sectional Titles Act, the Management Rules and the Conduct Rules of the scheme. Amongst their other duties, the Trustees manage the Body Corporate’s funds, enforce the rules and resolve conflict to the best of their ability.

References:

This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice. Errors and omissions excepted (E&OE)

The benefits of creating
a trust

B2Trusts are well-known to facilitate effective estate planning and continuity planning strategies. That said, setting up a trust – whether an inter vivos (between the living) or a testamentary (created in a will) − should be carefully considered and not just implemented blindly.

The difference between testamentary and inter vivos trusts

  1. A testamentary trust is established when a person (the founder) makes provision for establishing a trust in their will. The trust does not come into existence until the founder dies.
  2. An inter vivos trust is set up between the living. In other words, property is transferred before death to the trust by its founder and managed by the trustees for the benefit of another person or persons.

The death benefits of creating an inter vivos trust exceeds the cost – both in time and money. According to The Estate Duty Act, upon death, a duty is levied against your estate known as estate duty. The nett value of any estate will be determined by deducting all liabilities from your assets of your estate, both real and deemed.

Should you create a testamentary trust, upon death the assets are in your name and will need to be transferred to the trust posthumously, meaning all assets are taken into account when assessing the duty payable.

Advantages

Taking the above into account, here are some benefits you could experience from creating a trust:

  1. Reducing estate duty: Inter vivos trusts can be used to minimise estate duty. No estate duty should be payable on assets owned by the trust as a trust does not die.
  2. Protection against creditors: As the trust’s assets are not owned by the beneficiaries, creditors do not have a claim on the assets. This advantage is especially important for people who could be exposed to potential liability. Companies as well as individuals are able to transfer assets into trusts.
  3. Efficient succession: Since trusts never die, beneficiaries will be able to continue enjoying the assets if one beneficiary were to pass away.

Disadvantages

Despite the advantages, there are also some disadvantages of having a trust. They include the following:

  1. Costs: The costs of setting up a trust can be high. If assets are transferred into the trust, then transfer duty needs to also be paid.
  2. Duties of trustees: Trustees could find themselves personally liable for losses suffered by the trust if it can be proven that they did not act with care, diligence and skill according to Section 9 of the Trust Property Control Act.

References:

This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice. Errors and omissions excepted (E&OE)

The Competition Commission:
Play fair or else

B1There has been a lot of activity in the commercial sector regarding unfair behaviour according to the Competition Commission. Claims arose that retail giants blocked rivals by means of exclusive mall leases, which essentially impedes competition by preventing smaller operators from entering the market. A complaint also arose that Ster-Kinekor and Nu Metro engaged in market allocation with regards to lease agreements at the V&A Waterfront.

Fortunately, there is a Competition Commission that specifically deals with such cases.

What is the Competition Commission?

The Competition Commission is a statutory body constituted in terms of the Competition Act, No. 89 of 1998. Its purpose is to investigate, control and evaluate restrictive business practices, abuse of dominant positions and mergers in order to achieve equity and efficiency in the South African economy.

To achieve its purpose, the Commission’s core functions, set out in section 21 of the Act, are to:

Investigate and prosecute restrictive horizontal and vertical practices;

  1. Investigate and prosecute restrictive horizontal and vertical practices;
  2. Investigate and prosecute abuse of dominant positions;
  3. Decide on mergers and acquisitions applications;
  4. Conduct formal inquiries in respect of the general state of competition in a particular market;
  5. Grant or refuse applications for exemption from the application of the Act;
  6. Conduct legislative reviews; and
  7. Develop and communicate advocacy positions on specific competition issues.

How to lodge a complaint with the Commission?

Step 1: Complaining against another party: To begin the procedure officially, you will need to complete and send Form CC1 to the Commission.

Step 2: Joining in a case started by someone else with a similar complaint: After the Commission has received a complaint, it may publish a notice in the Government Gazette and/or other media, inviting any person who believes that the alleged practice has affected, or is affecting, a material interest of that person to file a complaint about the matter.

Step 3: Giving relevant information: The information that needs to be submitted to the Commission must contain the following:

  1. Name of complainant.
  2. Name of the party complained of, the respondent.
  3. A brief description of the conduct giving rise to the complaint.
  4. State whether the conduct is still continuing – if not, the date on which the conduct ceased.
  5. Provide a written submission setting out, in detail, the complainant’s cause for the complaint, how it arose, the parties involved, relevant dates and any other relevant information.
  6. Provide contactable details for the complainant, i.e. postal address, fax number or email address.

Step 4: Protecting information given to the Commission: If the information sent to the Commission contains trade, business or industrial information that belongs to you or a firm, has a particular economic value, and is not generally available to or known by others – and you do not want it revealed to others – you may request that it should be kept confidential by completing.

Step 5: Seeking interim relief: Any person who has lodged a complaint with the Commission concerning a restrictive practice, as explained above, may ask the Competition Tribunal for an interim relief order, whether or not a hearing or investigation has commenced in respect of the alleged prohibited practice.

Step 6: Where the Commission would not act: If the Commission declines to refer a complainant’s case to the Competition Tribunal for prosecution, the complainant may refer, within 10 days after receiving a “Notice of Non-Referral” from the Commission, the matter to the Competition Tribunal at his/her own cost.

Step 7: Withdrawal of a Complaint: In terms of Rule 16 of the Act, at any time during an investigation, a complainant may withdraw a complaint lodged with the Commission.

References:

This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice. Errors and omissions excepted (E&OE)

CAN I SUE A SHOPPING CENTRE IF I SLIP AND FALL?

B4By law, owners of businesses or property are required to take reasonable steps to ensure the safety of the general public. At minimum, owners or managers are required to warn the public of any potential dangers they have caused, are aware of or believe could occur.

So if a shopping centre has not met these requirements and you’re injured on their property as a result, you may have a valid claim. These are a few examples of the requirements shopping centres should have in place:

  1. demarcate dangerous areas;
  2. remove obstructions from walkways;
  3. light an area adequately;
  4. repair holes and cracks in the pavement; and
  5. put up railings or barriers.

Would my claim be valid?

The law does not require individuals to watch their every step. It is reasonable to assume that people look around them as they browse grocery shelves at the shops. A successful slip and fall claim is mainly dependent on proving that the injured person was less negligent than the owner of the premises where they were injured.

Ask yourself the following questions:

  1. Would a reasonable person, such as a property owner, foresee the reasonable possibility that his management or administration may injure another person, causing them to slip and fall?
  2. Could the property owner have done something to prevent the accident that resulted in the claim. For instance, could the occurrence of a slippery floor have been prevented and could it have been mopped up before someone climbed the stairs?
  3. Did the owner take steps to prevent the accident?

Details to collect if you want to make a claim

  1. The details (name, contact number and address) of the person in charge of the premises.
  2. Take photographs of the area where you were injured.
  3. You must contact the legal representatives of the business.
  4. You must get the relevant medical documents as well as the invoices detailing the procedures.

Reference

This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice. Errors and omissions excepted (E&OE)

THE CONSEQUENCES OF DRINKING AND DRIVING

B3With the festive holidays fast approaching, it’s necessary to address the consequences of drinking and driving. Unfortunately, the holidays bring devastating road accidents, with families being injured and losing members due to drunk-driving related incidents.

 What does the law say?

  1. According to the Road Traffic Act 93/96, which has been in effect since March 1998, no person shall on a public road:
  • Drive a vehicle; or
  • Occupy a driver’s seat of a motor vehicle, the engine of which is running, while under the influence of intoxicating liquor or a drug having a narcotic effect.
  1. No person shall on a public road:
  •  Drive a vehicle; or
  • Occupy a driver’s seat of a motor vehicle, the engine of which is running, while the concentration of alcohol in any specimen of blood taken part of his or her body is not less than 0,05 grams per 100 millilitres.
  1. If, in any prosecution for a contravention of the provisions of subsection (2), it is proved that the concentration of alcohol in any specimen of blood taken from any part of the body of the person concerned was not less than 0,05 grams per 100 millilitres at any time within two hours after the alleged offence, it shall be presumed, until the contrary is proved, that such concentration was not less than 0,05 grams per 100 millilitres of blood at the time of the alleged offence.

 What happens if you are caught?

  1. You will be arrested for being over the limit: If you are suspected of driving over the limit, you will be Breathalysed.
  2. Your blood will be taken: If the Breathalyser tests positive, you will be taken into custody and sent for further testing at an alcohol testing centre.
  3. You will be detained: Once you have been arrested you will be taken to a police station, where you will be detained in the holding cells for at least four hours to sober up.

After your release, a docket will be opened and you will be allocated an investigating officer who will follow up your blood test results.

Conclusion

Getting behind the wheel after drinking alcohol should not be an option. People should always use an alternative option, such as getting a lift with someone else, Uber, or using a taxi. Besides the fact that drinking and driving could cost you or someone else their life, it also has severe legal consequences.

References:

This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice. Errors and omissions excepted (E&OE)