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Chapter 19

This document discusses various types of real security rights created by law in South Africa. It defines tacit hypothecs of lessors and credit grantors as real security rights that are automatically created to secure claims for unpaid rent or credit payments. It also discusses judicial pledges, which allow a creditor to secure a claim against a debtor's property by obtaining a writ of execution. The document outlines different categories of statutory security rights and liens, and the requirements for establishing liens over movable or immovable property to secure debts arising from that property.

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Chante Hurter
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34 views5 pages

Chapter 19

This document discusses various types of real security rights created by law in South Africa. It defines tacit hypothecs of lessors and credit grantors as real security rights that are automatically created to secure claims for unpaid rent or credit payments. It also discusses judicial pledges, which allow a creditor to secure a claim against a debtor's property by obtaining a writ of execution. The document outlines different categories of statutory security rights and liens, and the requirements for establishing liens over movable or immovable property to secure debts arising from that property.

Uploaded by

Chante Hurter
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Chapter 19

Real security rights created by law

Tacit hypothec of lessors

Definition

Is a real security right created by operation of law ( and perfected by a court order,
followed by attachment ) to secure the landlord’s claim against the lessee for rent in
arrears. The hypothec applies to movable of the lessee on the premises.

- Applies to movable property belonging to the lessee and present on premises,


but in certain circumstances it can belong to third parties.

Bloemfontein Municipality v Jackson

- The requirements for subjecting property belonging to third parties


- Important to note that these requirements only apply with regards to
movables which not belongs to the lessee
1. The property must be on the landlord’s premises with the knowledge of its
actual owner
2. The property must be on the premises with some degree of permanence, and
not merely temporarily
3. The property must be on the premises for the lessee’s own use and benefit
4. The landlord must have been unaware of the fact that the property belongs
to someone else and not to the lessee

.
Section 2, security by means of movable property Act 57 of 1993

- Movable property
a) Which, while hypothecated by a notarial bond mentioned in section 1(1), is in
the possession of a person other than the mortgagee or
b) To which an instalment agreement, as defined in section 1 of the National
Credit Act, 2005, relates, shall not be subjected to a landlord’s hypothec

Tacit hypothec of the credit grantor

Definition

Is a real security right with regard to movables, and it secures the credit grantor’s
claim for outstanding payments in terms of a credit agreement in cases where the
credit receiver becomes insolvent before payment of the last instalment

- National Credit Act 34 of 2005


- The credit grantor retains ownership of the movable property until the credit
receiver pays the last instalment of the purchase price

Judicial pledge

Definition

Is a real security which secures a creditor’s claim against a debtor, and is established
by obtaining a writ of execution against the debtor and attaching the property

- Any creditor who has no real security to ensure her claim against the debtor
can obtain real security in the form of a judicial pledge by way of attachment
in terms of a writ of execution.

.
Statutory security rights

Dealing with specific debtor - creditor relations. Each statute creates its own form
and kind of security according to the circumstances.

Categories of statutory security rights

1. Statutory mortgage: Is created when a real security rights over movables or


immovables is established without the normal requirements for such right
2. Statutory fictitious pledge: Is created when a right of pledge over movables is
created in the absence of real delivery or control of the property subjected to
the pledge.
3. Statutory lien: Is a special kind of lien, created by statute, over movable or
immovable property
4. Preferent rights: Are security rights which do not amount to real security, but
nevertheless provide a preferent claim to the property.

Liens

Definition

Allows the holder of movable or immovable property to refuse the return the
property to the owner unless the owner pays an existing principal dept, which arose
from expenditure by the holder with regard to the property

- Liens are created by operation of law to ensure outstanding debts.


- Liens come into operation when one person is in control of movable or
immovable property of another person, who owes the controller money for
improvements to or costs incurred in relation to the property.
Requirements for a lien

1. The owner must be claiming it back from the defendant


2. The defendant must be in control of the property
3. The defendant must retain the property in order to ensure payment of a dept
owed to the holder by the owner
4. This principal dept can arise from either contract or unjustified enrichment
resulting from improvements or costs incurred in relation to the owner’s
property while it was in the defendant’s control.

Categories of liens

1. Debtor-creditors liens

Which secures payment of debt incurred in terms of a contract, and is therefore


based upon a personal obligation that can be enforced against the contractual
debtor only

- Enforced against other contract parties only


- The basis for the lien is the contract, and the amount for which it is valid is
the amount due in terms of the contract.
2. Enrichment liens

Which secures payment of a debt incurred by way of unjustified enrichment, and


which is therefore a real burden upon the property that can be enforced against any
person who happens to be the owner of the property

.
Categories of expense or improvements of property

1. Necessary expenses: For the maintenance of the property


2. Useful expenses: Are not strictly necessary, but they nevertheless improve
the property
3. Luxurious expenses: Are neither necessary or useful, are undertaken only in
pursuance of personal taste or whim

Categories of enrichment liens

a) Salvage liens secure payment of enrichment debts arising from necessary


expenses
b) Improvement liens secure payment of enrichment debts arising from
expenses

Acquisition

Physical control requirement ( will need to exercise effective control )

Mental Element ( die bedoeling om beheer te weerhou totdat die skuld betaal word )

Singh v Santam

The Court show the claim on a lien of the hand and ordered the car to Santam Singh
to give back.

No further improvements or cost is incurred while Santam was not in control, with
the result that there is no further cost, no enrichment, no principal debt, and
therefore no basis on which a lien could not be established

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