NUMERUS CLAUSUS AND THE DEVELOPMENT OF NEW REAL RIGHTS IN SOUTHAFRICAN LAWI M.J. de Waal (University of Stellenbosch, South Africa) Readers are reminded that this work is protected by copyright. While they are free to use the ideas expressed in it, they may not copy, distribute or publish the work or part of it, in anmy form, printed, electronic or othenwise, except for reasonable quoting, clearly indicating the source. Readers are permitted to make copies, electronically or printed, for personal and classroom use Abstract In this article, the numerus clausus principle and its application in South african law are discussed. The author introduces the discussion with a general explanation of South African law as a so-called mixed'legal system. This means that, although the found ation of South African law is Roman-Dutch law(that is, a civilian system), there has been a marked influence of English law in many areas of the law. However, one of the areas of South African private law in which the principles of Roman-Dutch law have been preserved to a large extent is the law of property. In the article, the focus is on an aspect of trad itional property law, namely the numerus clausus principle. It is explained that South African law does not adhere to this principle in the sense that new, hitherto unknown, real rights can be developed The criteria used by the courts the process of development of new real rights are discussed and their application is illustrated with reference to three examples from case law. The conclusion is that these criteria do not work satisfactorily when applied in practice. As a consequence, a degree of legal uncertainty exists with regard to the creation of new real rights by the courts. Finally, It is acknowledged that policy considerations should play a role in the recognition or not of new real rights. Policy considerations, and more specifically considerations of social policy, have indeed been decisive in the recent creation of new real rights by the South African legislature Contents 1 Introduction: South African law as a legal system 2. The South African law of property and the numerus clausus principle 3. The application of thesubtraction from the dominium'test: Three brief case stud ies 3.1 General 3. 2 Lorente y Melle and Others 3. 3 Pearly Beach Trust v Registrar of Deeds 3. 4 Denel(Pty )Ltd. V Cape Explosive Works Ltd. and Another This article is an extended and slightly revised version of a paper read at sta ff sem inars at the University of Nijmegen on 21 June 1999 and Maastricht University on 22 June 1999
NUMERUS CLAUSUS AND THE DEVELOPMENT OF NEW REAL RIGHTS IN SOUTH AFRICAN LAW1 M.J. de Waal (University of Stellenbosch, South Africa) Readers are reminded that this work is protected by copyright. While they are free to use the ideas expressed in it, they may not copy, distribute or publish the work or part of it, in any form, printed, electronic or otherwise, except for reasonable quoting, clearly indicating the source. Readers are permitted to make copies, electronically or printed, for personal and classroom use. Abstract In this article, the numerus clausus principle and its application in South African law are discussed. The author introduces the discussion with a general explanation of South African law as a so-called ‘mixed’ legal system. This means that, although the foundation of South African law is Roman-Dutch law (that is, a civilian system), there has been a marked influence of English law in many areas of the law. However, one of the areas of South African private law in which the principles of Roman-Dutch law have been preserved to a large extent is the law of property. In the article, the focus is on an aspect of traditional property law, namely the numerus clausus principle. It is explained that South African law does not adhere to this principle in the sense that new, hitherto unknown, real rights can be developed. The criteria used by the courts in the process of development of new real rights are discussed and their application is illustrated with reference to three examples from case law. The conclusion is that these criteria do not work satisfactorily when applied in practice. As a consequence, a degree of legal uncertainty exists with regard to the creation of new real rights by the courts. Finally, It is acknowledged that policy considerations should play a role in the recognition or not of new real rights. Policy considerations, and more specifically considerations of social policy, have indeed been decisive in the recent creation of new real rights by the South African legislature. Contents 1. Introduction: South African law as a ‘mixed’ legal system 2. The South African law of property and the numerus clausus principle 3. The application of the ‘subtraction from the dominium’ test: Three brief case studies 3.1 General 3.2 Lorentz v Melle and Others 3.3 Pearly Beach Trust v Registrar of Deeds 3.4 Denel (Pty.) Ltd. V Cape Explosive Works Ltd. and Another 1This article is an extended and slightly revised version of a paper read at staff seminars at the University of Nijmegen on 21 June 1999 and Maastricht University on 22 June 1999
4. Conclusion and evaluation 1. Introduction: South African law as a ' legal system Any contribution on South African private law should, at the outset, make it clear that South African law is a so-called ' mixed' legal system. This means that it is a legal system at the intersection of civil law and common law.2 From the time that the settlement at the cape was established as an outpost of the dutch East India Company (v.o.C. )in 1652, the law in this region was Roman-Dutch law(that is, a civilian system). This did not formally change with the two British occupations in 1795 and 1806. The reason is that the new rulers decided to retain the Roman-Dutch law as the law of the Cape and not to replace it with English law. 3 The British occupation nevertheless had a profound influence on the nature of South African law The broad pattern that emerged under British rule was a general movement towards English law and institutions. 4 This trend was particularly noticeable in the fields of the administration of justice, procedural law, the law of evidence and commercial law(for example, company law and the law of negotiable instruments. )However, private law was not insulated from this proces One therefore finds the influence of English law in many areas of private law, for example, the law of contract, the law of delict, the law of succession(especially in the context of formalities) and the law of agency. The reception of the English trust into South African law(though not in its English form) also provides an interesting example of the interaction between civil law and common law in the South african context 5 One of the areas of South African private law in which the principles of Roman-Dutch law have been preserved to a large extent is the law of property(or the law of things as it should preferably be called )6 Roman law, as received into and developed in the province of Holland dt urIng seventeen nth and eighteenth centuries therefore still forms the dogmatic basis of the modern South African law of property. 7 It should be borne in mind, however, that much of the dogmatic and systematic refinement of modern South African property law can in fact be traced to the work of the German Pandectists of the nineteenth century. The Roman-Dutch law of property, as transplanted to South Africa, has of course been further refined by the legislator and the courts. English law played a very minor role in this process of refinement and development 2R. Zimmermann and D Visser "South African Law asa Mixed Legal System'in R. Zimmermann andD. Visser (eds )Southern Cross: Civil Law and Common Law in South Africa Clarendon Press, Oxford(1996)1 at2 3H. R. Hahlo and E. Kahn The South African Legal System and Its Background Juta and Co., Cape Town(1973) 575ff 4Hahlo and Kahn(n 3)576 5See, in general, T Honore Trustin Zimmermann and Visser(eds )(n 2)849ff 6See, in general, C G. van der Merwe Sakereg(2nd ed. )Butterworths, Durban (1989)6 7C. G. van der Merwe and M.J. de Waal The Law of Things and Servitudes Butterworths, Durban (1993)sect. 6
4. Conclusion and evaluation 1. Introduction: South African law as a ‘mixed’ legal system Any contribution on South African private law should, at the outset, make it clear that South African law is a so-called ‘mixed’ legal system. This means that it is a legal system ‘at the intersection of civil law and common law’.2 From the time that the settlement at the Cape was established as an outpost of the Dutch East India Company (V.O.C.) in 1652, the law in this region was Roman-Dutch law (that is, a civilian system). This did not formally change with the two British occupations in 1795 and 1806. The reason is that the new rulers decided to retain the Roman-Dutch law as the law of the Cape and not to replace it with English law.3 The British occupation nevertheless had a profound influence on the nature of South African law. The broad pattern that emerged under British rule was a general movement towards English law and institutions.4 This trend was particularly noticeable in the fields of the administration of justice, procedural law, the law of evidence and commercial law (for example, company law and the law of negotiable instruments.) However, private law was not insulated from this process. One therefore finds the influence of English law in many areas of private law, for example, the law of contract, the law of delict, the law of succession (especially in the context of formalities) and the law of agency. The reception of the English trust into South African law (though not in its English form) also provides an interesting example of the interaction between civil law and common law in the South African context.5 One of the areas of South African private law in which the principles of Roman-Dutch law have been preserved to a large extent is the law of property (or the law of things as it should preferably be called).6 Roman law, as received into and developed in the province of Holland during the seventeenth and eighteenth centuries, therefore still forms the dogmatic basis of the modern South African law of property.7 It should be borne in mind, however, that much of the dogmatic and systematic refinement of modern South African property law can in fact be traced to the work of the German Pandectists of the nineteenth century. The Roman-Dutch law of property, as transplanted to South Africa, has of course been further refined by the legislator and the courts. English law played a very minor role in this process of refinement and development. 2R. Zimmermann and D. Visser ‘South African Law as a Mixed Legal System’ in R. Zimmermann and D. Visser (eds.) Southern Cross: Civil Law and Common Law in South Africa Clarendon Press, Oxford (1996) 1 at 2. 3H.R. Hahlo and E. Kahn The South African Legal System and Its Background Juta and Co., Cape Town (1973) 575ff. 4Hahlo and Kahn (n. 3) 576. 5See, in general, T. Honoré ‘Trust’ in Zimmermann and Visser (eds.) (n. 2) 849ff. 6See, in general, C.G. van der Merwe Sakereg (2nd ed.) Butterworths, Durban (1989) 6. 7C.G. van der Merwe and M.J. de Waal The Law of Things and Servitudes Butterworths, Durban (1993) sect. 6
Although the basis or foundation of South African property law remains Roman-Dutch, the role of legislation in the development of this area of the law warrants special mention. Indeed, an important dimension of South African property law is made up by what can be called statutory property law. Examples of legislation promulgated over the years affecting the law of property include environmental legislation influencing the use and exploitation of both public and private property, legislation dealing with the problem of informal housing (squatting), legislation dealing with mineral rights and legislation relating to sectional titles, time-sharing and real securIty As is the case with virtually every aspect of South African law, the law of property has also not been left untouched by the countrys new constitutional order. In this regard one does not only think of the constitutional property clause as such but also of recent legislation dealing with issues like restitution and redistribution of land and the provision of security of tenure to large numbers of, especially rural, land dwellers. 9 In this article, the focus will fall on an aspect of traditional property law, namely the numerus clausus principle. In particular the place and status of this principle and its effect on the development of new real rights in South African law will be discussed. This will be done, first by explaining the dogmatic treatment of the numerus clausus principle within the context of South African property law and, secondly, by illustrating the South African approach with a brief discussion of three specific examples from case law. In conclusion the treatment of the numerus clausus principle in South African law will be critically assessed, also with reference to one development within the context of recent statutory property law 2. The South African law of property and the numerus clausus principled The basic civilian character of the South African law of property is explained as follows by Van der merwe Roman law still forms the dogmatic basis of the modern [ South African] law of things Roman law influence is perceived in the clear distinction between ownership and possession and that between ownership and limited real rights; the perception of ownership as an indivisible right which confers on an individual the widest possible ownership in a movable; the various forms of real security; and the majority of the or powers with regard to a thing; the emphasis on delivery as a prerequisite for transfer original modes of acquisition of ownership 8Sect. 25 of the Constitution of the Republic of South Africa Act 108 of 1996 9As to this legislation, see further sect. 4 below tOThe exposition in this section dra ws heavily on the corresponding section in M.J. de Waal The Uniformity of Ownership, Numerus Clausus and the Reception of the Trust into South African Law, paper read at a conference on Trusts in Mixed Legal Systems at Utrecht University on 18 June 1999 I In Van der Merwe and De Waal(n 7)sect. 6
Although the basis or foundation of South African property law remains Roman-Dutch, the role of legislation in the development of this area of the law warrants special mention. Indeed, an important dimension of South African property law is made up by what can be called ‘statutory property law’. Examples of legislation promulgated over the years affecting the law of property include environmental legislation influencing the use and exploitation of both public and private property, legislation dealing with the problem of informal housing (‘squatting’), legislation dealing with mineral rights and legislation relating to sectional titles, time-sharing and real security. As is the case with virtually every aspect of South African law, the law of property has also not been left untouched by the country’s new constitutional order. In this regard one does not only think of the constitutional property clause8 as such but also of recent legislation dealing with issues like restitution and redistribution of land and the provision of security of tenure to large numbers of, especially rural, land dwellers.9 In this article, the focus will fall on an aspect of traditional property law, namely the numerus clausus principle. In particular the place and status of this principle and its effect on the development of new real rights in South African law will be discussed. This will be done, first, by explaining the dogmatic treatment of the numerus clausus principle within the context of South African property law and, secondly, by illustrating the South African approach with a brief discussion of three specific examples from case law. In conclusion the treatment of the numerus clausus principle in South African law will be critically assessed, also with reference to one development within the context of recent ‘statutory property law’. 2. The South African law of property and the numerus clausus principle10 The basic civilian character of the South African law of property is explained as follows by Van der Merwe:11 Roman law still forms the dogmatic basis of the modern [South African] law of things. Roman law influence is perceived in the clear distinction between ownership and possession and that between ownership and limited real rights; the perception of ownership as an indivisible right which confers on an individual the widest possible powers with regard to a thing; the emphasis on delivery as a prerequisite for transfer of ownership in a movable; the various forms of real security; and the majority of the original modes of acquisition of ownership. 8Sect. 25 of the Constitution of the Republic of South Africa Act 108 of 1996. 9As to this legislation, see further sect. 4 below. 10The exposition in this section draws heavily on the corresponding section in M.J. de Waal ‘The Uniformity of Ownership, Numerus Clausus and the Reception of the Trust into South African Law’, paper read at a conference on Trusts in Mixed Legal Systems at Utrecht University on 18 June 1999. 11In Van der Merwe and De Waal (n. 7) sect. 6
One of the basic principles of the civil law of property is the numerus clausus principle 12 This means that only real rights, means of delivery of movables and modes of original acquisition of ownership that fall into one of the recognized categories, the numerus clausus, will be countenanced by the law. 13 Any new or additional real right thus falls outside the closed system (or numerus clausus) As far as the creation of new real rights is concerned, however, South African property law does not strictly adhere to this basic civilian principle. As a point of departure South African law falls back on the traditional categories of real rights acknowledged in Roman law(for example ownership, servitudes, mortgage and pledge). At the same time it accepts that new rights can be added and that within the framework of recognized categories new types can evolve. 14 Concerning the creation of new real rights, examples that have been added over the years include the lease of land, mineral rights and real rights in respect of units in a sectional title scheme Within the framework of the recognized categories of real rights mentioned above, several new types have evolved. In the context of servitudes one can mention new praedial servitudes which have developed due to typical South African cond itions(for example, the right of trekpath, the right of outspan and so-called restrictive cond itions in township developments), as well as a new type of personal servitude(the so-called servitudes irregulares). i5 In the sphere of real security the cession of registered mortgages as well as notarial bonds over movables have developed The abovementioned categories and extensions thereof received statutory recognition in the Deeds Registries Act, 16 in that the Act makes provision for the registration of these rights. 17 It should be pointed out that, in order for a right in land to have real effect, it must be registered in terms of the Act. The Act therefore deals with rights in land and it stipulates that only real rights in land are registrable. 18 However, the Act makes provision for the registration of real rights not specifically referred to in the Act 19 Consequently, a testator or a party to a contract is not 12Van der Merwe(n. 6)11f Van der Merwe and De Waal(n. 7)sect. 8 13/bid I4For the exposition that follows, see a lso Van der Merwe and De Waal(n. 7)sect. 45 SServitutes irregulares are personal servitudes with the contents of typical praedial serv itudes(for example, the rights of passage or pasturage ), but esta blished in favour of a particular person and not for the benefit of a dominant tenement 16Act47of1937 17Sect. 3(1) &Sect. 63(1 ). This section conta ins a proviso that a personal right may be registered if it is, in the opinion of the Registrar of Deeds, complementary or otherwise ancillary to'a registrable right. Such registration does not however, convert the personalright into a real right: D.G. Kleyn and A. Boraine Silberberg and Schoeman's The Law of Property (3rd ed. ) Butterworths, Durban(1992)162; N.J.J. Olivier, G.J. Pienaar and A J. van der Walt Law of Property: Students' Handbook(2nd ed. )Juta and Co., Cape Town(1992)236; Van der Merwe(n 6)477 19Sect. 3(1r)
One of the basic principles of the civil law of property is the numerus clausus principle.12 This means that only real rights, means of delivery of movables and modes of original acquisition of ownership that fall into one of the recognized categories, the numerus clausus, will be countenanced by the law.13 Any new or additional real right thus falls outside the closed system (or numerus clausus). As far as the creation of new real rights is concerned, however, South African property law does not strictly adhere to this basic civilian principle. As a point of departure South African law falls back on the traditional categories of real rights acknowledged in Roman law (for example, ownership, servitudes, mortgage and pledge). At the same time it accepts that new rights can be added and that within the framework of recognized categories new types can evolve.14 Concerning the creation of new real rights, examples that have been added over the years include the lease of land, mineral rights and real rights in respect of units in a sectional title scheme. Within the framework of the recognized categories of real rights mentioned above, several new types have evolved. In the context of servitudes one can mention new praedial servitudes which have developed due to typical South African conditions (for example, the right of trekpath, the right of outspan and so-called restrictive conditions in township developments), as well as a new type of personal servitude (the so-called servitutes irregulares).15 In the sphere of real security the cession of registered mortgages as well as notarial bonds over movables have developed. The abovementioned categories and extensions thereof received statutory recognition in the Deeds Registries Act,16 in that the Act makes provision for the registration of these rights.17 It should be pointed out that, in order for a right in land to have real effect, it must be registered in terms of the Act. The Act therefore deals with rights in land and it stipulates that only real rights in land are registrable.18 However, the Act makes provision for the registration of real rights not specifically referred to in the Act.19 Consequently, a testator or a party to a contract is not 12Van der Merwe (n. 6) 11f.; Van der Merwe and De Waal (n. 7) sect. 8. 13Ibid. 14For the exposition that follows, see a lso Van der Merwe and De Waal (n. 7) sect. 45. 15Servitutes irregulares are personal servitudes with the contents of typical praedial servitudes (for example, the rights of passage or pasturage), but established in favour of a particular person and not for the benefit of a dominant tenement. 16Act 47 of 1937. 17Sect. 3(1). 18Sect. 63(1). This section contains a proviso that a personal right may be registered if it is, in the opinion of the Registrar of Deeds, ‘complementary or otherwise ancillary to’ a registrable right. Such registration does not, however, convert the personal right into a real right: D.G. Kleyn and A. Boraine Silberberg and Schoeman’s The Law of Property (3rd ed.) Butterworths, Durban (1992) 162; N.J.J. Olivier, G.J. Pienaar and A.J. van der Walt Law of Property: Students’ Handbook (2nd ed.) Juta and Co., Cape Town (1992) 236; Van der Merwe (n. 6) 477. 19Sect. 3(1)(r)
restricted to a numerus clausus of real rights but is in principle entitled to establish new, hitherto unrecognized, rights in respect of his or her land. This made it essential for the courts to devise criteria to determine whether such a new right is real and thus registrable, or merely personal. In practice these criteria have therefore been developed by the courts in the context of the registration of real rights in respect of land What is more, the development of new real rights land is confined to limited real rights(that is, real rights with regard to someone else's property) New or additional kinds of ownership(such as the beneficial or equitable ownership of English law) could not be developed in this way in South african law. 20 Finally, it should be pointed out that the statement that there is no numerus clausus of real rights in South African law is also true with regard to real rights in movables. There is, however, no example of a new type of real right developed by the courts in the sphere of movables. here the categories of real rights remain the trad itional ones of ownership, personal servitudes and pledge the courts have developed the following two criteria or requirements. I real and thus registrable To determine whether a particular right or cond ition in respect of land (a) the intention of the person who creates the real right(testator or contracting party) must be to bind not only the present owner of the land, but also his successors in title; and (b) the nature of the right or cond ition must be such that registration of it results in a subtraction from the dominium of the land against which it is registered The first requirement does not, generally speaking, present any difficulties. It is purely subjective in nature and entails an interpretation of, for example, the will or contract in question in order to determine the intention of the party or parties who created the right The intention to create a real right is not, however, enough. A right which, according to its inherent nature, is highly personal cannot be converted into a real right by intention alone. 22 Obviously there is also a need for an objective criterion which can be used in the process of determining whether or not a particular right can at all be classified as a real right. The second requirement mentioned above, the o-called subtraction from the dominium'test, 23 has been developed in case law to fulfil this function. However, as will be illustrated in the next section, the formulation of this requirement or test is easier than its practical application 3. The application of the subtraction from the dominium'test: Three brief case studies Like other civilian legal systems, South African law adheres to the unitary concept of ownership(or the uniform ity of ownership). This means that there is only one kind of ownership and that ownership cannot be fragmented, in the sense that there cannot be intermediate degrees of ownership 2I Van der Merwe in Van der Merwe and De Waal(n. 7)sect. 46. This exposition of the criteria was approved by the highest court in Erlax Properties(Pty )Ltd. v Registrar ofDeeds 1992(1)SA 879(A) 22 Hollins v Registrar of Deeds 1904 TS 603: Lorent: v Melle and Others 1978(3)SA 1044(T); chiloane v Maduenyane 1980(4)SA 19(W) 23The expressions dim inution of ownership, "burden on the land'or" charge upon the land'are also sometimes used
restricted to a numerus clausus of real rights but is in principle entitled to establish new, hitherto unrecognized, rights in respect of his or her land. This made it essential for the courts to devise criteria to determine whether such a new right is real and thus registrable, or merely personal. In practice these criteria have therefore been developed by the courts in the context of the registration of real rights in respect of land. What is more, the development of new real rights in land is confined to limited real rights (that is, real rights with regard to someone else’s property). New or additional kinds of ownership (such as the ‘beneficial’ or ‘equitable’ ownership of English law) could not be developed in this way in South African law.20 Finally, it should be pointed out that the statement that there is no numerus clausus of real rights in South African law is also true with regard to real rights in movables. There is, however, no example of a new type of real right developed by the courts in the sphere of movables. Here the categories of real rights remain the traditional ones of ownership, personal servitudes and pledge. To determine whether a particular right or condition in respect of land is real and thus registrable, the courts have developed the following two criteria or requirements:21 (a) the intention of the person who creates the real right (testator or contracting party) must be to bind not only the present owner of the land, but also his successors in title; and (b) the nature of the right or condition must be such that registration of it results in a ‘subtraction from the dominium’ of the land against which it is registered. The first requirement does not, generally speaking, present any difficulties. It is purely subjective in nature and entails an interpretation of, for example, the will or contract in question in order to determine the intention of the party or parties who created the right. The intention to create a real right is not, however, enough. A right which, according to its inherent nature, is highly personal cannot be converted into a real right by intention alone.22 Obviously there is also a need for an objective criterion which can be used in the process of determining whether or not a particular right can at all be classified as a real right. The second requirement mentioned above, the so-called ‘subtraction from the dominium’ test,23 has been developed in case law to fulfil this function. However, as will be illustrated in the next section, the formulation of this requirement or test is easier than its practical application. 3. The application of the ‘subtraction from the dominium’ test: Three brief case studies 20Like other civilian legal systems, South African law adheres to the unitary concept of ownership (or the ‘uniformity of ownership’). This means that there is only one kind of ownership and that ownership cannot be fragmented, in the sense that there cannot be intermediate degrees of ownership. 21Van der Merwe in Van der Merwe and De Waal (n. 7) sect. 46. This exposition of the criteria was approved by the highest court in Erlax Properties (Pty.) Ltd. v Registrar of Deeds 1992 (1) SA 879 (A). 22Hollins v Registrar of Deeds 1904 TS 603; Lorentz v Melle and Others 1978 (3) SA 1044 (T); Chiloane v Maduenyane 1980 (4) SA 19 (W). 23The expressions ‘diminution of ownership’, ‘burden on the land’ or ‘charge upon the land’ are also sometimes used