For time immemorial registrars of deeds have been registering notarial tie-agreements which have the status of a personal servitude, and are capable of being registered under the provisions of section 65 of the Deeds Registries Act 47 of 1937.
The notarial tie-agreement must be entered into between the owner or owners of the land being notarially tied and the person enforcing the tie-agreement. The enforcer could be the local authority, bank or any person or entity who would derive benefit from the properties being tied.
Different Owners and/or different Deeds Registries
In terms of RCR 17 of 1961 and confirmed by RCR 1 of 1966 the registrars of deeds resolved that it is possible to tie properties where such properties are held by different owners. It is thus not necessary that the properties being tied have to be owned by the same person.
Where the properties to be notarially tied are situated in jurisdiction areas served by different Deeds Registries, for example Johannesburg and Pretoria, a notarial deed encompassing both properties must be registered in each Deeds Registry on the same day, i.e. simultaneous registration must occur.
Where two or more properties are tied, the bondholder of any bond registered against any of the properties, forming the subject of the agreement, must consent to the registration of the tie agreement, free from the bond (see section 65(3) of the Act).
Subject of Tie-Agreement
In terms of RCR 44 of 2010, it is not permissible to register a notarial tie-agreement in respect of a long term lease agreement and land, in order that the land and the lease agreement cannot be separately be dealt with.
The properties as already mentioned do not have to be owned by the same owner and can be situated in different property registers, administrative districts, Provinces, etc.
Operative Clause of the Agreement
As with all notarially prepared agreements there is no hard and fast rule as to the exact wording, however, the following wording merely serves as a guideline:
"That the owner of the above referred to properties and the City Council of Tshwane hereby agree that the said properties shall be tied together and be regarded as one property for all intents and purposes."
Any ancillary conditions to the agreement must also be contained in the notarial deed.
Rates Clearance Certificates
No rates clearance certificate needs to be lodged.
Adding or Removing of Properties
Should it be required to either release certain properties or add additional properties to a tie agreement, the initial agreement must be cancelled and a new agreement must be entered into. This can be effected, if so required, in one bilateral notarial agreement entered into between the owners of the land and the enforcer of the tie agreement.
A tie agreement cannot be created as a stipulatio alteri, i.e. in favour of for example a body corporate not in existence at the time of creation of the condition, as there will be nobody to accept the negative personal servitude as required by the last proviso to section 65(1) of the Act.
Certificates of Consolidated Title and Tie Conditions
Where two pieces of land are consolidated and the components are subject to a notarial tie agreement, the condition must be perpetuated in the certificate of consolidated title and the registrar of deeds will endorse the certificate of consolidated title as to the lapsing of the condition. However, the enforcer of the tie condition must lodge a consent to the issuing of the certificate of consolidated title and the lapsing of the tie agreement (see RCR 21 of 2008).
Where only one of the properties which have been notarially tied is sold in execution or by the trustee of an insolvent person, the agreement will have to be cancelled, prior or simultaneously with the transfer; alternatively both properties will have to be transferred together. The properties cannot be separately dealt with, irrespective of whether it is a forced sale.
Registration of Mortgage Bond
Where two or more properties are notarially tied, the separate entities cannot serve as security under the mortgage bond. All the properties forming the subject of the agreement must serve as security under the bond.
Untying of Properties
Should the enforcer no longer wish to enforce the notarial tie agreement, such agreement can be cancelled by virtue of a bilateral notarial agreement entered into between the owner(s) of the land and the enforcer of the condition, as provided for in section 68(2) of the Act. Alternatively, the enforcer can prove unilaterally the waiver of the condition, in which case the provisions of section 68(1) can be invoked to cancel the condition. For the untying of the properties or cancellation of the tie agreement, no bondholders consent is required.
Property Law Specialist