Always Ensure You Know Whether There Are Servitudes Registered Against the Title Deed

Property servitudes is something we rarely encounter - until you e.g. :

(1) apply to your local municipality to have the building plans for the extension of your garage approved, and then get it rejected because there is a servitude registered against your title deed in favour of the municipality

or, you are prevented from

(2) building a second floor or even planting a tree by a servitude on your title deed which imposes a "right to free prospect" for your neighbour - allowing them right to an open view which limits the rights of you as the "servient property owner" to obstruct the view with buildings or trees.

Servitudes can therefor definitely increase or decrease the value of your immovable property depending in whose favour the servitude is registered.

When buying a property always ensure that you examine the title deed of a property to ascertain whether there is a servitude registered over a property.

After registration in the Deeds Office the servitude forms part of the conditions contained in the title deed or it would be in the form of an endorsement on the said title deed.

SERVITUDES - PRAEDIAL AND PERSONAL

A servitude, whether praedial or personal, is a limited real right registered against the title deed of one person (subject) in favour of another person's title deed (entitled). Servitudes require registration in the Deeds Office, and once registration has taken place, the holder entitled thereto, may exercise the particular rights on the property of another, and at the same time, prohibit the subject-owner from exercising those particular rights.

Registration of servitudes are a legal requirement, because the Alienation of Land Act requires that the granting of an interest in land by one person to another, must be recorded in a written agreement to be valid, and registered against the applicable title deeds.

But, what are the difference between praedial and personal servitudes?

1. Praedial Servitude

A praedial servitude is a right that attach to the property itself (and not to a person) and even though a change in ownership may take place, this servitude will continue to exist and can only be cancelled by agreement between the parties. The most commonly known praedial servitudes are rights of way, pipeline servitudes, electrical substation servitudes, etc, keeping in mind that it is a requirement that a praedial servitude must provide a distinct benefit or advantage to the dominant tenement (entitled property).

2. Personal Servitude

A personal servitude is a right that attach to a specific person, to use and enjoy another's property however the right cannot exist longer than the lifetime of the person in whose favour it was registered. The most commonly known personal servitudes are usufructs, fideicommissums and usus, keeping in mind that it is a requirement that a personal servitude (like praedial servitudes) must provide a distinct benefit or advantage to the dominant person (entitled property).

PRAEDIAL SERVITUDES

In terms of Section 1(b) of the Alienation of Land Act, the definition of 'land' includes 'any interest in land', and 'alienate' which corresponds with 'alienation', in relation to land, means 'sell, exchange or donate'. It is established that a praedial servitude (such as a servitude right of way) constitutes an 'interest in land' as envisaged in the Act, and requires to be in writing and signed by the parties involved (Section 2 of the Act). If this procedure is not followed, we are dealing with an oral agreement of servitude, which is not valid and binding on the parties thereto.

Creation and Registration Section 76 of the Deeds Registries Act provides for the procedures to register praedial servitudes in deeds of transfer in respect of both the dominant- and servient tenements. An example is where A is the owner of two properties, and he sells one to B. As a condition of sale, A requires a right of way servitude over the property sold to B. In this respect, the servitude may be created in the Power of Attorney to Transfer (as it is created by the Transferor), and will be brought forward in the respective title deeds. 

A's property will be entitled, and B's property will be subject thereto.

In most cases, a servitude diagram is required to indicate exactly where the servitude will be located on the servient property, provided it does not run along the entire boundary line of the existing property. In case of the latter, a servitude diagram is not required, as it can be identified on the existing property diagram.

In earlier title deeds, we find many praedial servitudes, to regulate development of properties in the cities. However, some of these servitudes have fallen into disuse, much like in the case of Pickard v Stein and Others 2015 (1) SA 439 (GJ).

In the Pickard case, the Court considered whether a praedial servitude of light had been abandoned or had simply fallen away. The facts of the case were as follows:

Pickard (subject) requested Stein (entitled) to consent to the cancellation of a praedial servitude of light, which was registered in favour of Stein's property. In terms of the servitude, the owner of Pickard's property was prevented from erecting any structures, fences or planting any vegetation exceeding a particular height along part of their common boundary. Despite the servitude being registered in favour of her property, Stein and her predecessors in title grew trees and shrubs along the relevant boundary, exceeding the height limitations prescribed by the servitude. Initially, Stein consented to the cancellation provided that Pickard build a brick wall on top of the existing boundary wall. Pickard duly built the wall, however, a dispute arose and Stein refused cancellation. The Court found that Stein had abandoned her rights, not by allowing the trees and shrubs growing on the servitude area (as Pickard was not allowed to do so), but by insisting on a wall being built on the boundary wall, which impacted on the light she wanted. The Court, for this reason, ordered the cancellation of the servitude of light.

A further example of the registration of praedial servitudes, are dealt with in developments, where a road or roads are created for vehicular access and egress, meaning the access for the owners in the development to move freely within the development (or Estate), from the main entrance to their respective properties. In certain instances, the road/s are registered as rights of way, and should the right of way be indicated over certain properties, the title deeds of those properties, when registered in the name of the Purchaser thereof, will contain the servitude. The Agreement of Sale should make reference to the servitude or possible servitude that will burden the property, and should also include a specific condition that the Purchaser may not build a wall or any structure of any nature, on that servitude area.

A praedial servitude commonly found in title deeds for areas such a Sea Point, Bantry Bay and Camps Bay, are height servitudes, whereby a property owner will be prohibited from building a structure to a certain height, as it may impede on the view of other properties. Cancellation of such servitudes will be difficult, as it will severely impact on the value of the properties entitled.

Cancellation

The cancellation of a praedial servitude must be contained in a bilateral notarial deed of cancellation and must be registered in the Deeds Office, to note the removal of the servitude condition from the respective title deeds. However, if more that the land owners are required to be a party to the cancellation i.e the local authority, or another entity (ESCOM etc), that entity should also be included in the Notarial Cancellation.

"Cancellation" may also occur when the owner of either property, becomes the owner of the other property. In this case, the servitude will lapse by merger, as the Law does not allow the registered owner of a property to have a servitude registered over his/her property.

What are Usufructs, Fideicommissum and Usus?

As previously mentioned, these servitudes are personal in nature, as it attaches to the person in who's favour the servitude is registered.

USUFRUCT

A Usufruct is a legal institution in which someone, who is not the owner, is given the right to use and enjoy the profits and advantages of something belonging to another as long as the property is not damaged or altered in any way, for a certain period of time. At the end of this period, the property must be handed over to the person who owns it.

The holder of a usufruct is known as a usufructuary, who has the right to use (usus) the property and enjoy its fruits (fructus), but does not acquire ownership of the property, known as the bare dominium.

The usufruct must be registered at the particular Deeds Registry, against the title of the land over which the usufruct is applicable, and cannot be sold and bequeathed by the usufructuary i.e in a Will or otherwise.

A usufruct is basically a life interest which someone acquires in terms of i.e a Will. It gives the usufructuary the right to use and enjoy specific assets of the estate for the term stipulated by the testator in the Will. An example is where a husband bequeaths a residential property to his children in his Will, but stipulates that his wife (the mother) must/may enjoy a usufruct, until the day she pass away. In this way he ensures that his wife has the use and enjoyment of the property.

Section 66 of the Deeds Registries Act 47 of 1937 limits the duration of a usufruct to the lifetime of the person in whose favour it was created, and further restricts the cession thereof to only the owner of the land encumbered thereby.

A usufruct may, of course, be ceded to two or more persons in equal undivided shares, and should one of the usufructuaries die, the servitude will only lapse in respect of the undivided share of the deceased, and the property will remain subject to the usufruct in respect of the remaining holders' undivided share. However, where a usufruct is created in favour of two persons jointly, the principles of the ius accrescendi apply on the death of the first dying.

In the same vein, where a usufruct is created in favour of spouses married in community of property, the usufruct does not lapse partially or in respect of an undivided half share where one of the spouses die, but again the share of the deceased accrues to the surviving spouse.

The usufruct thus will only lapse in toto on the death of the surviving spouse.

Rights and Obligations of the Usufructuary

The Usufructuary is required by law to act as a diligent owner that may not misuse the property. The usufruct must be used properly for the purposes intended. The Usufructuary has the right to either live on the property, or rent it out to generate an income, although the term of the rental agreement may not exceed that of the usufruct. Therefore, should the usufructuary pass away, the rental agreement will automatically lapse. This fact must be contained in the rental agreement.

The Usufructuary is responsible for paying the assessment rates and general daily maintenance costs, but is not obliged to do large-scale repairs resulting from normal wear and tear. Even if an item were to perish due to daily use, the Usufructuary would not be obliged to replace it.

The 'rights' of the usufructuary could cause problems for the children, (the ultimate heirs), because while the usufruct is in effect, the children have no right and authority with regard to the use and/or enjoyment of the property. Although it was bequeathed to them, it is subject to the usufruct in favour of their mother. They have to refrain from interfering; although they naturally have the right to protect their interests should the usufructuary misuse the property.

Maintenance, repairs and insurance premiums will be for the heirs (the childrens) account, and they are obliged to ensure that the property is in a liveable condition at all times. To this end, it is advisable that the testator (the husband) who bequeaths the usufruct make financial provision for the maintenance of the usufruct asset. Otherwise he could put unnecessarily burden on the heirs or even cause them financial problems. A life policy is a very cost-effective way of doing this, with specific instructions that the funds should be utilised for the maintenance and/or repairs to the property.

The usufruct will automatically lapse when the usufructuary pass away. If the heirs die before the usufructuary, their share of the usufruct assets is transferred to their heirs (per stirpes), but remains subject to the existing usufruct.

Often, a usufruct is created to reduce the amount that the testator's estate will have to pay in estate duty. While the children become the owners of the property, the estate duty liability is greatly reduced because the usufruct, which needs to be valued. The usufruct then passes to the surviving spouse free of estate duty, while the bare dominium (to the heirs) is no longer the full value of the property, but the difference between the property value and the value of the usufruct.

Contingent Usufructs

"Contingent" is defined in the Concise Oxford Dictionary as: "that can be anticipated to arise if a particular event occurs".

It is trite law that more than one usufruct cannot exist concurrently over the same property, as nobody can transfer more rights than he/she owns. It is thus clear that where a usufruct exists over property, a second usufruct will not be capable of being registered. To circumvent this, practice has allowed for the registration of a contingent usufruct. Registrars of deeds will allow that the bare dominium be registered subject to the existing usufruct and the deed will further be made subject to the condition in respect of the second usufruct (this being the contingent usufruct).

The second usufruct is not registered, and may only be claimed from the bare dominium owner once the first usufruct has lapsed. In terms of Registrars Conference Resolution 47 of 1987, a Registrar of Deeds will insist on the cession of the contingent usufruct as soon as he/she becomes aware of the lapse of the first usufruct.

An example of a contingent usufruct is where the owner of land bequeaths a usufruct to his son, A, who is married out of community of property to B, subject thereto that should B survive A, she will be entitled to the usufruct after the death of A. As already discussed two usufructs cannot exist concurrently over the same property. To overcome this problem, the registration of a contingent usufruct in favour of B is the only solution. The creating document of the usufruct must be made subject to a further condition that B may claim her usufruct only after the lapse of the existing usufruct in favour of A.

If property is subject to a contingent usufruct, such property cannot be transferred or mortgaged free from the contingent usufruct. In the case of a transfer, the Purchaser must either take over the property subject to the contingent usufruct, or the holder of the contingent usufruct can, by an underhand consent, waive his right in which case the provisions of section 68(1) of the Deeds Registries Act will be invoked to record the lapsing of the usufruct against the title of the land. In the case of a mortgage, the holder of the contingent usufruct must waive his/her rights in favour of the bondholder notarially, or in the bond, in terms of Regulation 41(7) of the Deeds Registries Act. The mentioned waiver provides security to the Bank, that the holder of the usufruct will not infringe on the rights of the Bank, especially if the bank foreclose on a property.

Where the bare dominium owner, the holders of the usufruct and contingent usufruct together sell their respective rights in the property, the provisions of section 69(1) of the Act can be applied, in terms of which the bare dominium owner and both the usufructuary and contingent usufructuary jointly act as transferors to transfer the property to the new owner, free from any usufruct. The holders of each right need not be a party to the sale agreement.

What is a fideicommissum?

A fideicommissum is a legal institution, where the owner of a property transfers his property to another person, subject to it being transferred from that person to yet another person at a later stage.

Usually, a fideicommissum (condition) is created in a Will, according to which property is first bequeathed to the one person and then, subsequently, to someone else, i.e. in such a case, the heir (known as the fiduciarius, that is, the bare dominium owner) inherits the property and it is transferred to him/her, on condition that he/she will transfer it to someone else at a given stage. Later, the proprietary right of the fiduciarius is ended (after the lapse of a stipulated period, or when a condition has been met) and the property is transferred to the fideicommissarius (the sequential owner).

Before we proceed, it is important to explain the "role" of the fiduciaries, who is deemed the owner of the land, however he only has a fiduciary right to the land, i.e. he can deal with the property as far as he is permitted by the fideicommissum (condition). This usually means that the fiduciarius may not deal with the land or mortgage the land, without the fideicommissionary waiving preference of the fideicommissary right in favour of the Bank.

Three examples to create a fideicommissum:

1. Where a testator provides in his Will that his farm should go to his son A, on condition that the farm goes to A's son B upon A's death. In this example, the testator, therefore, creates a fideicommissum with regard to his farm; A will then be known as the fiduciarius, while B (after A pass away and the land is transferred) will be known as the bare dominium owner.

How is a fideicommissum created and registered?

The fideicommissum (condition) is created in the Power of Attorney to Transfer, and is brought forward in the deed, i.e. the executor in the deceased's estate must transfer the farm to A, subject to the fideicommissum in favour of B. In other words, the deed is made subject to the fideicommissum.

A is not described as a fiduciarius in the vesting clause. The only way of determining whether the property that was transferred to A is indeed subject to the fideicommissum, is by reading the testamentary condition in the deed. It is therefore a requirement that the Will should be lodged with the transaction at the Deeds Registry.

What happens when A pass away?

When A passes away, his executor will have to transfer the farm to B, in terms of the fideicommissum condition and not according to A's Will, as A cannot bequeath the farm to another person - the Will doesn't even have to be lodged. Because it is transferred according to the fideicommissum condition, reference must also be made to the condition in the causa.

2. A husband and his wife are married in community of property and have a mutual Will. In the Will, their estates are massed. The husband passes away and his wife receives all his farms, subject to a fideicommissum in favour of their son. The wife has adiated (i.e. she has accepted the conditions of the will). In the causa, reference is made to their marital status, estate massing, adiation, etc. The farms are transferred to the wife, subject to a fideicommissum in favour of their son.

After a few years, the wife passes away. How will her estate be administered?

• The estate is administered in accordance with the fideicommissum in the title. (The executor of the wife's estate transfers the farms to the son).
• The will is not submitted.
• In the causa, reference is only made to the fideicommissum.

3. A dies and bequeath his farm to his daughter D, subject to a fideicommissum in terms of his Will. The Wills stipulate that "the mentioned farm goes to our daughter D, with the understanding that, in the event of the death of my mentioned daughter, the farm will be transferred in equal shares to the children who are to be born to her. When D dies and her estate is administered, her children should be proven by filing an Affidavit of Next-of-Kin with the Master's office, and the property will be transferred to those (proven) children.

How is property transferred that is subject to a fideicommissum?

As mentioned earlier, the fiduciarius is the owner of the land, but this is a limited proprietary right, i.e. he can deal with the property as far as he is permitted by the fideicommissum (condition). This usually means that the fiduciarius may not transfer the land unless subject to the fideicommissum.

There are, however, exceptions to the above rule and the most important from the point of view of the deeds office, is Section 69bis of the Deeds Registry Act.

Subsection (1) stipulates that the fiduciarius and the fideicommissary heir can jointly transfer their rights. The most important limitations of Section 69bis(1) are:

• The fideicommissum heir(s) should be determined and proven.
• They should have the contractual capacity to act.
• The Master's approval or court order should be lodged, where necessary.

The fideicommissum is then omitted from the deed. In the instance of the waiver of the fideicommissum condition by the heir, the waiver is filed with the new deed as a document. The transferor then acts alone and the land is transferred free from the fideicommissum.

Should the fiduciarius decide to mortgage the property, Section 69bis (3) is applicable, in that:

• Where the fiduciarius only wants to mortgage his fiduciary right to the land with a bond, but it is prohibited by the conditions of the fideicommissum. In such a case, the land will be mentioned as security in the bond, subject to the fideicommissum.
• Where the fiduciarius mortgages his fiduciary right to the property and the fideicommissary heir simultaneously waives his preference, in favour of the bond.

➢ The bond must then be made subject to the condition.

➢ Power of attorney to waive should be submitted by the fideicommissary heir. It is filed with the mortgage as a document.

• When they are determined and competent, fideicommissary heirs can also waive their fideicommissum rights notarially, simultaneously with the registration of the bond. Where the fiduciarius and the fideicommissarius (if he is competent) jointly mortgage their respective rights to the land with the bond (section 69bis (3)).

USUS

A Usus is defined as the act of making the bare use of real or personal property without enjoying its income, profit, or product.

 A servitude of use or usus resembles a usufruct but the holder's rights are far more restricted. If the property are movables, he may possess and use the property, and if the property is immovable, he and his family may occupy it. 

The holder may take the fruits for his and his family's daily needs, however, he may not sell any fruit, nor may he grant a lease of the property. There are a few exceptions, for example should the house be too large for the holder's use, he may let a portion of it. The holder's use must, however, be without detriment to the substance of the property.

Cancellation

In most instances of a personal servitude, it lapse on the death of the person if it was registered for the person's lifetime, or lapse if a predetermined time-period has lapsed (i.e valid for 10 years only). Another method of cancellation, is a merger. Much like a merger with praedial servitudes mentioned previously, a personal servitude will lapse my merger when the servitude owner acquires the property, and the same principle as with praedial servitudes, the owner of a property may not have servitudes in favour of himself, or burdening his property, over property that he/she owns.