Sonnekus and the question of original and derivative ownership

1.    Auctions and ownership: original or derivative?

Conventionally, derivative acquisition of ownership required the consent of the owner.[1] There also must then be registration in order for the transfer to take place.[2] As there is no consent or agreement Sonnekus argues that the new owner after sale in execution cannot receive the property based on derivative ownership[3] but the property must become owned by no one[4] (res nullus) and then come to the new owner through original acquisition of ownership.This results from  Sonnekus’ argument that the property is no longer owned by the original owner from the point judgment is made, and not at the point where the property is sold in execution.[5]

This is not the only way to explain auctions in terms of the doctrine of original acquisition of ownership. We can also consider that the property is expropriated or becomes the new owner’s property by statutory passing of ownership. Gaius’ dictum[6] that sale of public land under the spear (sub hasta) gave full rights of ownership is consistent with any of the views expressed below.

1.1.1.    Expropriation

If the original owner does indeed not transfer the property and the sheriff does not transfer the property on his behalf, then it is not necessarily the case, logically, that the property therefore becomes res nullus[7]. It is also possible, that one could see the transaction as one of expropriation. The definition of expropriation is that “through expropriation (a) the ownership of a thing, movable or immovable, vests in the expropriator; (b) while the previous owner loses his ownership without consenting thereto; (c) usually against the payment of compensation to him:”[8]

This fits with the phenomena of a property being sold by court order without the owner’s consent. Although there is no compensation paid, the definition says that compensation is usually paid, not always. In terms of the Constitution, the lack of compensation could be justified by Section 25 3 e[9] which provides that the compensation depends on the purpose of the expropriation. On the other hand, it is possible that in terms of the constitution’s other factors, compensation should have been paid to the previous owner when the house is sold for less than it was worth. Sub section c requires that the market value is a factor to be taken into account.[10]

Expropriation takes places subject to all existing registered rights, unless these rights are also specifically expropriated.[11] It is interesting that expropriation is considered pure administrative action.[12] This would imply that the provisions of Section 33 and by extension PAJA[13] should apply to sale in execution.[14]

1.1.2.    Statutory passing of ownership

Another conceptual option would be to see the transaction as another form of original acquisition of ownership: statutory. In statutory ownership title passes without the previous owners co-operation but the limitations of ownership also pass.[15] This is presumably why Sonnekus does not apply to sale in execution as he holds the limitations of the property do not continue to the new owner. Three acts transfer property via this method. These are the Insolvency Act,[16] the Agricultural Credit Act[17] and the Companies Act.[18] In terms of the former, the assets of the sequestrated estate pass to the master immediately on sequestration and to the curator immediately on appointment. In terms of the latter, the assets of a liquidated company pass immediately to the liquidator but prior to this the master is simply in control of the assets.[19]  Although the rules of court are not a statute, the transfer affected by Uniform Rule 46 could be considered analogous and the assets of the victim of the sale in execution could be considered transferred to the sheriff or could be considered controlled by the sheriff according the models of sequestration or liquidation respectively.

1.2.  Reversing sales in execution and transferring

Sonnekus’ argument implies that a sale in execution cannot be reversed because the property is not transferred by the sheriff. If the sale does not comply with the requirements or is inconsistent with the Constitution then there was no valid transfer of the property out of the name of the original owner. Once the property has been validly taken out of the ownership of the original owner, then it cannot be reversed.

Expropriation or statutory acquisition of ownership both fit better with the case law than the idea that the property becomes res nullus. In the case of expropriation, the property becomes owned by the state at the date of the order.[20] In the case of statutory acquisition, the model to follow would be that of sequestration where, again, the assets vest in the state. Thus, to deal with the problem raised in Hugo[21] with Sonnekus’ argument outlined above, it becomes proper to talk, as in Menqua vs Markum[22] of the Sheriff transferring the property. The Sheriff, as an agent of the state, which has acquired the property by original acquisition of ownership is now in a position to transfer it to a third party. In the case of Jaftha,[23] also cited by Hugo, most of the references to transfer can be interpreted in this way (as can the sub rules of URC 46).  However paragraph 48 cannot be so interpreted: “In view of the above I am of the view that the consequences of the sale in execution and the transfer of immovable property that constitutes the home of a person in terms of section 66(1)(a) do not conflict with the provisions of section 26.”[24] Here it is clearly the transfer of “property that constitutes the home of a person”. Not property that constitutes the former home of a person before the order is made. However, the court was not at that point attempting to make a point on this issue, and it could be argued this is simply loose language not intended to have legal effect on this subject we are currently discussing.

In Brown and Co [25] it is clearly stated that the debtor maintains the dominium up until the point of the sale. This can still be made to fit a view of original acquisition of ownership. In this view, control of the property transfers out of the hands of the original owner and on sale in execution is acquired by the new owner by the statutory method (original acquisition of ownership). This is thus analogous to the liquidation method (control of assets) rather than the sequestration method (transfer of assets). It is also consistent with a view that control is transferred on the order and then original acquisition is obtained by expropriation at the time of registration. In addition, whether the method of acquisition is by statutory or expropriation, it could still be said that the state obtained the property at the time of registration and transferred the property to the new buyer.

1.3.  The alternative view

The alternative view is to conclude that the property is transferred from the original owner to the new owner by the sheriff by derivative acquisition of ownership. This involves accepting that there is a second form of derivative transfer of ownership which does not involve real agreement but where the terms and conditions of ownership are set by the state.

In some ways, this fits more naturally with the case law discussed above in which the judgments seem to assume that they are discussing derivative acquisition of ownership and discuss very freely the concepts of transferring without the qualifications necessary to make the phrase work in terms of the theories proposed above to harmonise their statements with the Sonnekus theory that sale in execution is by original acquisition of ownership.

1.4.  The abstract theory

The applicable case law with respect to the abstract theory was analysed in Knox[26] Pertinently to our analysis, the whole case assumes that the method of acquiring property sold in execution is derivative and not original.

Mr Knox was the executor in the deceased estate of his late mother. At the time of her death, FNB (which is a division of First Rand) had the bond on the property. As a result of her death, she was obviously unable to pay the bond and the bank instead of waiting for the estate to be finalised, the bank took default judgment and sold the property in execution. The bank did not serve on the executor but only on the domicillium of the late bond holder.

The buyer at the sale in execution (O’ Shea) sold the property on to Mofokeng in whose name it was registered. At that time the executor became aware of what the bank had been doing without his knowledge and sought and obtained a rescission of the default judgment. Mofokeng was instructed by the order not to sell the property. He thus  moved out and stopped paying the bond (this time to Standard Bank).

Again rather than wait for the executor to finish winding up the estate, Standard Bank now tried to sell the property in execution. When the executor learnt of these new developments, he applied to court for an order prohibiting Standard Bank from proceeding with the sale in execution. Standard Bank on the basis that Mofeking was the owner at the deeds registry, defended the matter. The executor’s counter-argument was that since the first sale by First Rand was not valid, then Standard bank has no rights on the basis of nemo dat qui non habet – no one can pass on more rights than they have. The judgment on which the sale was based had been rescinded, according to this view, and therefore there was no basis on which to pass on any rights. Everything following was therefore also invalid.

This theory, of course, is based on the idea that this whole transaction is one of derivative ownership. The court followed this theory. The full judgment of the court was that where the judgment is rescinded after a sale in execution but before transfer then the owner can set aside the sale in execution and interdicting transfer. However, in the case of Knox, the property has also been transferred. In this circumstance, regardless of the fact that the judgment had been rescinded, the property could not be restored to the original owner but remained with the new purchaser, provide he was bona fide. This is provided that the original judgement and sale in execution were valid.

The “abstract theory”, in contrast to the causal theory, is a theory about how derivative ownership works. It has been clear in South African law that the abstract theory is the applicable theory since the 1941 case of Randles Brothers:

“From these passages it is clear, I think, that a wide meaning must be given to the words “justa causa” or “causa habilis” (Voet, 41.1.35), and that all that these words mean in the context I am at present considering is that the legal transaction preceding the traditio[27] may be evidence of an intention to pass and acquire ownership. But there may be direct evidence of an intention to pass and acquire ownership and, if there is, there is no need to rely on a preceding legal transaction in order to show that ownership has, as a fact, passed. To put it more briefly it seems to me that the question whether ownership passed depends on the intention of the parties and such intention may be proved in various ways.”[28]


This means that the invalidity of the preceding (non-real[29]) agreement, does not affect the validity of the transfer of ownership so long as there is a real agreement and the registration of the property.[30] This is thus law concerning the nature of derivative ownership and not that of original methods of acquiring ownership. The phrase “abstract theory” appears 20 times in Knox v Botha and is completely integral to the reasoning of the court. There is no thought whatsoever that the form of acquisition of ownership might be anything other than derivative. If Sonnekus’ theory is correct and sale of execution is by original acquisition of ownership then the (now established) reasoning in Knox is completely flawed.

The cases of Legator McKenna v Shea and Meintjes NO v Coetzer are relied upon in Knox. In the first, Shea was in a car accident which left her incapable of managing her own affairs. She was the owner of a house in Durban. McKenna was the curator of her affairs and sold her house to a certain Mr and Mrs Erskine. Mrs Shea then recovered and took over her affairs again and applied to the court to return her house. The basis for her action was that Mr McKenna sold her house before the master had granted him letters of curatorship.[31] The Durban High Court agreed. The SCA however disagreed in that McKenna received the letters before transfer. The SCA further held in terms of contract that if both parties fully perform in terms of a contact, even if it is invalid, then neither party can later reverse that contract if their common purpose had been achieved, presuming it was lawful. On the other hand in Meintjes[32] where there was fraud the sale could be reversed despite the fact it had been duly registered. There had, in that case, been no transfer of ownership and the registration did not change that.

These are not sale in execution cases. They do, however, establish that registration after transfer is normally final, unless there is fraud in the original document.

1.5.  Voiding sales in execution

The original order of the Western Cape high court, in Menqa v Markom was that the sale in execution of a house to Menqa and the subsequent sale of the property to Roux, were declared to be null and void. The Registrar of Deeds, Cape Town, was also instructed to register, Markom as the owner of the property.

Markom had a judgment against him for personal injury from a previous tenant (Tromp) which he did not know about for around R100,000. This led to a sale in execution notice arriving four years later. He managed to get an interdict to stay the sale but by the time the sheriff received it, the sale had already taken place. The warrant of execution was found by a later Cape High Court to be invalid because it was issued by the clerk of the Magistrates Court without proper judicial supervision as required by Jaftha[33]. Thus the sale in execution was also invalid.

The SCA agreed with the reasoning of the court a quo and confirmed the orders of the Western Cape High court that the sale in execution of the property, as well as the subsequent sale to Roux, were null and void, and prohibiting the Registrar of Deeds from registering transfer of the property to Roux. The SCA did not confirm the part of the order that transferred the property back to Markom as inter alia it did not take into account the money paid by Menqa.

In Campbell the Supreme Court of Appeal upheld an appeal against a judgment in the High Court which dismissed an application for a declaration that the appellant was still the owner of a property despite a sale by the sheriff which was supposed to be a sale in execution. The SCA decided there had been no attachment because neither the warrant nor the notice of attachment had been served on or in any other way brought to the notice of the owner. This meant that the sale therefore did not qualify as a sale in execution. This also meant as a result that the sheriff had no authority to sell the property and could not therefore transfer the dominium in the property to buyer. The original owner therefore remained the owner.

If the ownership had been lost to the original owner with the judgment as Sonnekus argues, it is difficult to see why it would be important to notify him as to the sale in execution. In conclusion then, it appears best to proceed on the basis that a sale in execution represents derivative acquisition of ownership.

[1] Van der Walt and Pienaar Introduction to the Law of Property (Juta: 1999) p142.

[2] Van der Walt and Pienaar Introduction to the Law of Property (Juta: 1999) p142-3.

[3] Sonnekus (2008) TSAR 707.

[4] Sonnekus (2008) TSAR 718 (para 9.5).

[5] Sonnekus (2008) TSAR 716.

[6] Gaius 4, 16 .

[7] Effectively owned by no one.

[8] Van der Walt and Pienaar Introduction to the Law of Property (Juta: 1999) p127.


[9] Constitution of the Republic of South Africa Section 25 3 e.

[10] Constitution of the Republic of South Africa Section 25 3 c. We will discuss this further in chapter five which concerns the constitution.

[11] Minister of Defence v Commercial Properties Ltd 1956 (2) SA 75.

[12] Van der Walt and Pienaar Introduction to the Law of Property (Juta: 1999) p128; If sale in execution is in fact a form of expropriation, then questions arise about whether the Expropriation Act applies to sales in execution. These questions are beyond the scope of this thesis.

[13] Promotion of Administrative Justice Act No 3 of 2000.

[14] To explore this is also beyond the scope of this work.

[15] Van der Walt and Pienaar Introduction to the Law of Property (Juta: 1999) p130.

[16] Insolvency Act 24 of 1936. Section 20 1 a.

[17] Agricultural Credit Act 28 of 1966. Section 27 (3) (though this section appears to have been now deleted).

[18] Companies Act 61 of 1973.Section 361(3) The new Companies Act still uses these provisions of the old act.

[19] Van der Walt and Pienaar Introduction to the Law of Property (Juta: 1999) p130.


[20] Or indeed at the date of registration as we shall see.

[21] Hugo, Charl et al “Property, the Rules of Court and Consumer Protection Act Regulations: Back to the Drawing Board” p58.

[22] 2008 2 SA 120 (SCA) 129G-130B para 24.

[23] Jaftha v Schoeman and Others, Van Rooyen v Stoltz and Others (CCT74/03) [2004] ZACC 25; 2005 (2) SA 140 (CC); 2005 (1) BCLR 78 (CC) (8 October 2004) par 59

[24] Jaftha v Schoeman and Others, Van Rooyen v Stoltz and Others (CCT74/03) [2004] ZACC 25; 2005 (2) SA 140 (CC); 2005 (1) BCLR 78 (CC) (8 October 2004).

[25] Liquidators Union and Rhodesia Wholesale Ltd v Brown & Co

1.1.          [26] Knox vs Mofokengand Others (2011/33437) [2012] ZAGPJHC 23; 2013 (4) SA 46 (GSJ).


[27] Traditio was the simple delivery of possession with the intention of passing ownership and was the method of conveyance of the jus gentium (Encylopedia Britanica – online)

[28] Commissioner of Customs and Excise v Randles Brothers & Hudson Ltd( 1941) (33 SATC 48) p411.

[29] As in not being concerned with ‘real’ property but merely giving rise to contractual rights.

[30] Van der Walt and Pienaar Introduction to the Law of Property (Juta: 1999) p144.


[31] Administration of Estates Act 66 of 1965 s 72(1)(b).

[32] Meintjes NO v Coetzer 2010 (5) SA 186 (SCA).

[33] Jaftha v Schoeman and Others, Van Rooyen v Stoltz and Others (CCT74/03) [2004] ZACC 25; 2005 (2) SA 140 (CC); 2005 (1) BCLR 78 (CC) (8 October 2004)