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[2024] ZAECQBHC 40
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Shackleton Credit Management (Pty) Ltd v J.J.N and Others (1975/2013) [2024] ZAECQBHC 40 (14 May 2024)
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IN
THE HIGH COURT OF SOUTH AFRICA
EASTERN
CAPE DIVISION, GQEBERHA
CASE
NO: 1975/2013
In
the matter between:
SHACKLETON
CREDIT MANAGEMENT (PTY) LTD
Applicant
and
J[…]
J[…] N[…]
First
Respondent
U[…]
M[…] N[…]
Second
Respondent
ABSA
BANK LTD
Third
Respondent
JUDGMENT
Bloem
J
[1]
The applicant, Shackelton Credit Management (Pty) Ltd (Shackelton),
seeks an
order that a certain immovable property, sectional title
3[…], SS Innikol, scheme number 9[…], measuring 84
square meters in extent, held under sectional title deed ST3[…],
Louis Fourie Road, Vyf Brakke Fontein, Mossel Bay (the
property), be declared executable. The first and second
respondents are J[…] J[…] N[…] (Mr N[...]) and
U[…] M[…] N[...] (Mrs N[...]) respectively and the
third respondent is Absa Ltd.
[2]
It is undisputed that during 2004 and at Gqeberha, Mr N[...] executed
a deed
of suretyship in favour of Standard Bank. In terms
thereof he bound himself as surety and co-principal debtor with
Sophisticated
Agencies CC (the principal debtor) in respect of the
principal debtor’s liability arising out of an overdraft
facility that
Standard Bank advanced to the principal debtor.
The latter breached the terms of the overdraft facility and became
indebted
to Standard Bank. Mr N[...] failed to settle the
principal debtor’s indebtedness to Standard Bank. On 5
August
2013 the registrar of this Court entered judgment in favour of
Standard Bank against the principal debtor and Mr N[...] in
respect of two claims. Only the first claim, for payment of
R386 486.29, is relevant to this application. Standard
Bank ceded its rights, title and interest in and to its book debts,
inclusive of its claim against the principal debtor and Mr
N[...], to
Shackelton with effect from 19 November 2020. During March 2023
Shackelton instituted the present application.
[3]
Only Mrs
N[...] opposed the application. She alleged that she and
Mr N[...] were married
[1]
but that their marriage was dissolved by an order of divorce on
16 April 2013. The court order incorporated the
terms
of a deed of settlement, which Mr and Mrs N[...] had concluded.
Clause 5 of the deed of settlement deals with the division
of
their joint estate. They agreed that, when the divorce order
was granted, Mr N[...] would forego his half-share in
the
property in favour of Mrs N[...]. It stated that she would
become the sole owner of the property and Mr N[...] would
become the
sole owner of another identified immovable property. In the
deed of settlement Mr and Mrs N[...] undertook to
sign all documents
necessary to give effect to the transfer of their respective
half-shares in the above properties from one to
the other. They
furthermore agreed on the firm of attorneys which would attend to the
registration of the immovable properties
into their respective names.
The deed of settlement dealt with the division of the immovable
properties and their registration
into the respective parties’
names as follows:
“
5.3
The Plaintiff will become the sole owner of the following:
5.3.1
… ;
5.3.2
The sectional title unit,
SS Innikol
Scheme
NO/year:
9[…]
Unit:
3[…]
Title Deed
No:
ST3[…]
And all common use areas.
Situated at Hartenbos
The Defendant undertakes
to sign all documents necessary to transfer his half undivided share
into the name of the Plaintiff.
5.4
The Defendant will
become the sole owner of the following:
5.4.1
Erf:
2[…]
Hunters Retreat
Title
Deed:
T58[…]
Situated at
[…] C[…] Road, Sherwood
The
Plaintiff undertakes to sign all documents necessary to transfer her
half undivided share into the name of the Defendant.
5.5
The Parties hereby nominate and appoint Laubscher Attorneys as the
Attorneys who will attend
to the registration of the transfer of the
said immovable properties onto the name of the respective parties.”
[4]
In summary, the factual situation relevant to the relief sought in
this application
is that on 16 April 2013 Mr and Mrs N[...] divorced
and on 5 August 2013 judgment was granted against Mr N[...], not
against Mrs
N[...]. The judgment was accordingly granted after the
divorce order had been granted. It is against that background that
Shackleton
seeks an order declaring the property executable.
[5]
In Mrs N[...]’s main defence she claims that she is the
sole owner
of the property, that Shackleton does not have a claim
against her and that it was accordingly not entitled to an order
declaring
the property to be executable. She alleged that, when
Mr N[...] alienated his half-share of the property to her, she
acquired
sole ownership thereof. Surprisingly, she nevertheless
said that this court must determine when full ownership in the
property
passed to her. In this regard, she asked whether “
it
[was] upon the granting of the divorce order on 16 April 2013 or
upon the endorsement of the title deed
?”
[6]
The answer
to Mrs N[...]’s claim that she is the sole owner of the
property is to be found in the distinction between real
rights and
personal rights. Real rights are concerned with the
relationship between a person, like the owner of a thing,
and the
thing.
[2]
The holder of
the real right is entitled to control the use of the thing. A
real right is enforceable against any person
who seeks to deal with
the thing (to which the real right relates) in a manner which is
inconsistent with the holder’s right
to control the use of the
thing.
[3]
[7]
Personal
rights are concerned with the relationship between persons. The
holder of a personal right can enforce it, not against
all, as is the
case with a real right, but only against another person or a group of
persons,
[4]
based on a special
legal relationship, such as a contract, a delict or some other good
and sufficient cause.
[5]
A personal right entitles the holder thereof to claim some
performance or action by another person or persons.
[8]
Immovable
property is acquired by either the original or derivative method.
If the acquisition is dependent on the cooperation
of a predecessor
in title, the property is acquired by the derivative method. In
the absence of a predecessor, the property
is acquired by the
original method.
[6]
Immovable property is transferred when the transferor transfers it to
the transferee by registration of a deed of transfer
in the deeds
office. The two requirements for the transfer of ownership in
immovable property from one person to the other
are firstly, that the
transferor must have the intention of transferring the property to
the transferee, who must have the intention
of receiving the
property; and secondly, the transfer must be effected by registration
of a deed of transfer in the deeds office.
[7]
[9]
Mrs N[...] contended that Mr N[...]’s half-share in the
property vested
in her immediately on divorce.
Section 16
of
the
Deeds Registries Act 47 of 1937
is the starting point in deciding
whether that contention is correct. In relevant part section 16
reads as follows:
“
Save
as otherwise provided in this Act or in any other law
the
ownership of land may be conveyed from one person to another only by
means of a deed of transfer executed or attested by the
registrar
[of deeds], and other real rights in land may be conveyed from one
person to another only by means of a deed of cession attested
by a
notary public and registered by the registrar
[of
deeds] …”. (own underlining)
[10]
In
Fischer
v Ubomi Ushishi Trading CC and others
[8]
it was held that, on a proper construction of
section 16
,
derivative acquisition of ownership in land requires registration.
In this case, Mrs N[...] acquisition of Mr N[...]
half-share in
the property was derivative, because it arose from the deed of
settlement which gave Mrs N[...] a personal right
to enforce
registration of Mr N[...]’s half in the property.
[11]
When the
above principles are applied to the facts of the present case,
Mrs N[...]’s claim, that she is the sole owner
of the
property, is legally incorrect. It is common cause that Mr
N[...]’s half-share in the property had not been
transferred to
her by registration in the deeds office. The reason therefor, the
alleged lack of financial resources, is immaterial.
The deed of
settlement or the order which incorporated the deed of settlement did
not by itself vest ownership of Mr N[...]’s
half-share in the
property in Mrs N[...]. She required something more. In
terms of
section 45
bis
(1)
(a)
of the
Deeds Registries Act 16 she
was required to apply to the
registrar to make an endorsement on the title deed of the property to
the effect that she is entitled
to deal with the property. Upon
such endorsement she “
shall
be
entitled to deal therewith as if … she had taken formal
transfer … into … her name of the share of [her]
former
spouse … in the property …”.
[9]
In terms of
section 16
she required “
a
deed of transfer executed or attested by the registrar
”
for ownership in Mr N[...]’s half-share to be transferred
into her name.
[12]
What
accrued to Mrs N[...] on divorce was not the ownership of Mr N[...]’s
half-share in the property, but the right to claim
that Mr N[...] be
compelled to transfer his half-share in the property into her
name.
[10]
Until registration
takes place, Mrs N[...] will remain the holder of a personal right
enforceable only against Mr N[...] to
compel him to transfer his
half-share of the property into her name. Her personal right
will be changed to a real right only
upon registration. That is when
her personal right will come to an end and she will become the holder
of a real right. It
is only then that she will become the sole
owner of the property.
[11]
[13]
In the circumstances, Mr N[...]’s half-share in the property
did not vest in Mrs N[...]
immediately upon the conclusion of
the deed of settlement or when the deed of settlement became an order
of court. Ownership of
the property would have passed to her only
upon registration in the deeds office. In the circumstances,
Mrs N[...]’s
main defence, that she is the sole owner of
the property, must fail.
[14]
Mrs N[...] also claimed, in the alternative, “
that upon
granting the order, I acquired a personal right to compel transfer to
me of my ex-husband’s half share in the property
in question.
This personal right protects my interests in the property against the
claim of the Applicant until it is formally
transferred by the
endorsement into my name
.” As pointed out
above, when the deed of settlement was made an order of court, Mrs
N[...] acquired a personal
right to claim transfer of the property
into her name. There was no evidence to show that, when Mrs
N[...] acquired that
right, she faced a greater or competing right to
defeat her claim. When Standard Bank obtained the judgment on 5
August 2013
and when Shackleton subsequently instituted the present
application on 8 March 2023 for an order declaring the property
specially
executable, Mr N[...] had already alienated his half-share
in the property to Mrs N[...] by way of the deed of settlement
which was incorporated in the divorce order. In the
circumstances, and in accordance with
Fischer v Ubomi Ushishi
,
Mrs N[...]’s personal right against Mr N[...] to compel
transfer of his half-share of the property preceded Shackelton’s
claim. The relief sought by Shackelton against Mr and Mrs
N[...] can for that reason not be granted. The application
should accordingly be dismissed. Costs should follow the
result.
[15]
In the result, it is ordered that the application is dismissed with
costs.
GH
BLOEM
Judge
of the High Court
APPEARANCES
For
the applicant:
Mr I
Lambrecht, instructed by Lynn and Main Attorneys, Johannesburg and
Joubert Galpin and Searle Attorneys, Gqeberha.
For
the second respondent:
Ms N
Karsan, instructed by Johan Nel Attorneys, Mossel Bay and Strauss
Daly Attorneys, Gqeberha.
Date
heard:
25
April 2024
Date
of delivery of judgment:
14
May 2024
[1]
Although it is not expressly stated in the affidavits filed of
record, it is clear from the documentation attached to Mrs N[...]’s
affidavit that she and Mr N[...] were married in community of
property.
[2]
Ethekwini
Municipality v Mounthaven (Pty) Ltd
2019 (4) SA 394
(CC) para 9.
[3]
National
Credit Regulator v Opperman and Others
2013 (2) SA 1
(CC) at 20B-C.
[4]
Absa
Bank Ltd v Keet
2015
(4) SA 474
(SCA) para 20, where the court explained the distinction
between a real right and a personal right as follows: “
Real
rights are primarily concerned with the relationship between a
person and a thing, and personal rights are concerned with
a
relationship between two persons
.”
In
Masstores
(Pty) Limited v Pick n Pay Retailers (Pty) Limited
Froneman
J stated that real rights are protected against all the world
whereas personal rights carry protection only between immediate
parties.
[5]
Badenhorst, Pienaar and Mostert
Silberberg
and Schoeman’s
The
Law of Property 5 ed (LexisNexis) Butterworths
,
2006)
at 51.
[6]
Silberberg
and Schoeman’s
The
Law of Property n 5 at 71 and 72.
[7]
Legator
McKenna Inc and Another v Shea and Others
2010 (1) SA 35
(SCA) at para 22; referred to with approval in
Absa
Bank Limited v Moore and Another
2017 (1) SA 255
(CC) para 14.
[8]
Fischer
v Ubomi Ushishi Trading CC and others
2019
(2) SA 117
(SCA) paras 12 to 29.
[9]
Section 45
bis
(1)
(a)
of the
Deeds Registries Act reads
as follows:
“
(1)
If immovable property or a lease under any law relating to land
settlement or a bond is registered in a deeds registry and
it -
(a)
formed
an asset in a joint estate of spouses who have been divorced, and
one of them has lawfully acquired the share of his or
her former
spouse in the property, lease or bond; or
(b)
…
,
the
registrar may, on written application by the spouse concerned and
accompanied by such documents as the registrar deems necessary,
endorse on the title deeds of the property or on the lease or the
bond that such spouse is entitled to deal with such property,
lease
or bond, and thereupon such spouse shall be entitled to deal
therewith as if he or she had taken formal transfer or cession
into
his or her name of the share of the former spouse or his or her
spouse, as the case may be, in the property, lease or bond.
[10]
Estate
Smith v Estate Follett
1942 AD 364
at 383.
[11]
Ethekwini
Municipality v Mounthaven (Pty) Ltd
n
2 paras 18 and 19.