The question of whether a lessee can receive a Certificate of Registered Title (“CRT”) over its interest in a portion of land, the whole of which is subject to a registered long-term lease agreement, becomes relevant when the lessee wishes to mortgage its interest in such a portion.
There is no specific enabling provision in the Deeds Registries Act 47 of 1937 (the “Act”) which authorises the Registrar of Deeds (the “Registrar”) to issue a CRT in the above circumstances. Nonetheless, there is authority in favour of it.
The Registrars’ Conference Resolution 27 of 2014 held that an undivided share in a registered long term lease agreement may serve as security under a mortgage bond - as long as such an undivided share is held under its own separate title deed.
Further, section 3 (1) (r) of the Act provides that the Registrar shall “register any real right, not specifically referred to in this subsection….” As a registered right of long term lease is a real right, and the Act makes no specific provision for the registration of a CRT in these circumstances, section 3 (1) (r) could be relied on as an enabling provision, authorising the Registrar to issue a CRT to the lessee for the portion of the lease which the lessee intends to mortgage.
It must be noted that the above reference to a CRT will relate to a notarial certificate of lease in respect of the relevant portion.