Partition Agreements to Transfer Jointly-Owned Land
Joint owners of a piece or pieces of land may want, or need, to redistribute the land among themselves and so become individual owners of a defined portion of that land (or of a sectional title unit) in their own names. This can be done in terms of section 26 of the Deeds Registries Act and a partition agreement.
To be able to effect a redistribution by way of a partition agreement the joint owners must each own an undivided share of the land they wish to partition. The agreement must apportion a defined piece of that land to each of the joint owners and may not simply be an agreement to redistribute their respective shares in the land among themselves. All the owners must be parties to the agreement.
There are several circumstances in which the partitioning of property may be appropriate or useful.
The advantage of using a partition agreement is that, unlike a sale or exchange agreement, it does not attract transfer duty. The only exception to this rule is in cases where an equalisation payment, as explained above, is made. In such cases, transfer duty is payable in respect of the value of the equalisation payment.
Garlicke & Bousfield Inc.