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11 Feb 2021 12:00 am
A conveyancing question has been asked about the correct sequencing of a series of transactions involving twins and a Sectional Title scheme, with specific reference to a High Court Order and the executor of an estate not being allowed to be a developer.
It reads as follows:
A. Erf 7 Fairyvale is registered in undivided equal shares in the names of:
A (twin deceased) – 1/3rd share
B (twin) – 1/3rd share
C (family friend) – 1/3rd share
Two residential houses have been erected on the property.
A is deceased. B is her only intestate heir.
To complicate matters further:
B. Some years ago, there was some dispute between the 3 co-owners which ended up in Court and a High Court Order was issued.
Quoted hereunder is an extract from the High Court Order:
“The parties shall attend to the subdivision of the property in terms of which it is divided into two equal portions of land on which each of the aforesaid residential dwellings is situated whereby that portion of land on which the residential dwelling commonly known as 77A Fair Street, Fairyvale is transferred into the name of First and second Plaintiff ( Executor of A & B) and that portion of land on which the residential dwelling commonly known as 77 Fair Street, Fairyvale is transferred to C, the costs of which are to be borne in equal shares between A& B on the one hand and C on the other hand, subject to the approval of such authority and/or statutory provision which may be applicable to the subdivision of land
The Court Order directs that the property be subdivided (the parent property), but because of the size of the entire parent property i.e. 495 square metres, it would appear that the subdivision of the property into two separate pieces of conventional land is prohibited by the local authority and its By-Laws as each piece would be too small. For this reason the town planners obtained permission to open a Sectional Title Register.
C. The Sectional Title Diagrams have since been approved and the Sectional Title Register is now ready to be opened in the Deeds Office.
Due to the fact that an executor is not, in this instance permitted to be a developer of a sectional title scheme ( RCR 4/2013 ), what will the sequence of the transactions be?
- Surely the 1/3rd share of the property must first be transferred from estate A to B (remaining twin) and against registration B will own 2/3rds of the parent property and C a 1/3rd share.
- The opening of the sectional title register would be the second simul in the line. Where B and C will act as the developers.
Against registration of the opening of the Sectional Title Register and the creation and registration of the CRST’s for the two units, B will own 2/3rd share of each unit and C will own a 1/3rd share of each unit, and this share detail should be recorded in the new CRST’s.
- Based on the approval of a Sectional Title Register, if I apply the Court Order to the next transaction in the line, I have prepared two sectional title partition transfers. This is where my queries lie:
- One partition transfer will transfer a 2/3rd share of Unit 1 to C; and
- One partition transfer will be a reciprocal transfer of a 1/3rd share of Unit 2 to B;
With appropriate divesting clauses and values, so that B and C each own 100% of their own unit.
Am I correct in this? AND
- The fact that the Court Order refers to a subdivision and not a sectional title scheme with partition transfers, will this be an issue at Deeds Office as the supporting document to be lodged would be the Court Order as this is the basis for the transaction? And
- Subsequent transfers are normal sectional title transfers of each of the units?