[TYPE THE COMPANY NAME] The Place of “Intention” in Inaedificatio Cases Shingai-Harry Jijita 7/14/2014 1 Table of Contents Contents: page. 1. Introduction……………………………………………………….. 2 2. The Nature of Inaedificatio……..………………………………… 2 3. Case Law and the role of “intention”……………………………. 3 3.1. Case Law………………………………………………… 3 3.2. The role of “intention” in Inaedificatio cases…………..... 4 4. Conclusion………………………………………………………….. 5 Bibliography……………………………………………………….. 7 2 Introduction This essay considers the role of “intention” in inaedificatio cases. Latter day case law has incorporated intention, in particular the subjective intention of the annexor of the movable (or owner), into the test whether, as a matter of fact, inaedificatio has occurred. This has been criticised by many authors with the main criticism raised being that subjective intention should play no part in determining the (non-)occurrence of inaedificatio. This essay begins by investigating the nature of inaedificatio and its requirements. It then addresses the research question by analysing recent case law and seeks to determine the correctness of the courts’ recent approach in view of the principles relating to inaedificatio. Lastly and by way of conclusion this essay shall consider the role, if any, intention should play in determining the (non-)occurrence of inaedificatio. The Nature of Inaedificatio Accession is an original method of obtaining ownership and the accession of a movable to an immovable occurs where “the movable (accessory thing) is permanently attached to the immovable (principal thing)”1. In the case of immovable property, the land is always the principal thing and the things permanently attached to it are the accessory things (with the exception of sectional titles)2. Inaedificatio (building) is the type of non-natural accession by which a movable (building or structure) accedes to an immovable (land) when sufficiently attached to the property of the landowner3 and through the application of the doctrine superficies solo cedit (that which attaches permanently to the land accedes to and becomes a part of the land)4, the owner of the immovable acquires ownership of the composite thing through the assignment of law5, where the movable is permanently annexed to the principal thing, therein losing its independence6. As a prerequisite for inaedificatio, the various components of the composite thing (the principal and accessory thing[s]) must remain recognisable, the composite 1 Van der Walt and Pienaar Introduction to the Law of Property (2009) 104. Ibid 103. 3 Carey Miller The acquisition and protection of ownership (1986) 22; Route BV and Others v Sunspun Bananas (Pvt) Ltd and Another [2010] ZWHHC 27 at para. 30. 4 Badenhorst, Pienaar and Mostert Silberberg & Schoeman’s The law of property (2006) 147. 5 Pocock v De Oliveira and Others [2006] ZAGPHC 245 at para. 16. 6 Van der Walt and Pienaar Introduction to the Law of Property (n 1 above) 104. 2 3 thing must be difficult to separate without causing damage to the principal or accessory thing7, and the attachment must not amount to the creation of a new thing with another’s materials (specificatio)8. The (non-)occurrence of inaedificatio is a factual finding and our courts have developed a test as guide to making such a determination. The test was expounded in Olivier & Others v Haarhof & Co.9 and confirmed in MacDonald Ltd v Radin NO and The Potchefstroom Dairies & Industries Co Ltd10 and is summarised as follows: The court will enquire first into the nature and purpose of the movable and the manner and degree of its annexation to the immovable (hereinafter ‘the two factors’). The two factors are determined objectively. In considering the first factor, the movable must be capable of annexation to the land and be predetermined to serve the land on a permanent basis, and in considering the second factor, the court enquires whether the movable can be removed without great damage (or cost) to it or the immovable and the attachment must be sufficient to indicate permanency11. Only when the objective assessment leads to an equivocal result will the court look into a further factor, that is, the annexor’s intention at the moment when the movable was attached to the immovable in establishing whether inaedificatio has occurred12. Case Law and the role of “intention” Case Law Great uncertainty exists in our case law as to the role intention should play in determining whether or not inaedificatio has occurred. In Standard-Vacuum Refining Co. of SA (Pty) Ltd v Durban City Council13 the court referred to MacDonald and drew a distinction between the annexor’s objective intention (deduced from the two factors) and the subjective intention which should be established where the objective intention is indeterminable14. The court gave Knobel I “Accession of Movables to Movables & Inaedificatio – South Africa and some Common Law Countries” 2011 Journal of Contemporary Roman-Dutch Law 296 298. 8 Van der Walt and Pienaar Introduction to the Law of Property (n 1 above) 107. 9 1906 TS 497 500. 10 1915 AD 454 466. 11 Pope A “Inaedificatio revisited: Looking backwards in search of Clarity” 2011 SALJ 123 125. 12 Determined subjectively. 13 1961 (2) SA 669 (A). This case is an example of where the objective and subjective intention coincided. 14 Van der Walt and Pienaar Introduction to the Law of Property (n 1 above) 106. 7 4 preference an objectively determined intention in event of an equivocal result following an objective assessment into the (non-)occurrence of inaedificatio. A ‘new approach’ to determining the (non-)occurrence of inaedificatio is to be found in three recent cases, namely, Theatre Investments (Pty) Ltd and Another v Butcher Brothers Ltd15, Melcorp SA v Joint Municipal Pension Fund (Transvaal)16 and Konstanz Properties (Pty) Ltd v Wm Spilhaus en Kie (WP) Bpk17. In Theatre the court emphasised the subjective intention (ipse dixit) of the annexor in determining her intention18 and in terms of this ‘new approach’, the subjective intention of the annexor is the decisive factor and is more important than the objectively assessed “physical circumstances” and the objective factors amount to supplementary indicators of intention19. In the event that the owner and annexor of the movable are different persons, the intention of the owner is decisive20. A third approach (‘omnibus approach’) is found in Sumatie (Edms) Bpk v Venter en ‘n Ander NNO21 22 which looks at the purpose of the attachment, considering cumulatively, annexor’s subjective intention at the time of the connection and all other relevant factors in making a determination on the (non-)occurrence of inaedificatio23. The role of “intention” in Inaedificatio cases As alluded to earlier, accession is an original method of acquiring ownership and ownership of the movable is not transferred to the landowner. Rather, the movable loses its independence and inaedificatio occurs by operation of law “when specified objectively assessed factors coincide”24. The landowner acquires ownership of the movable when it accedes to his land and the 15 1978 (3) SA 682 (A). 1980 (2) SA 214 (W). 17 1996 (3) SA 273 (A). 18 However in this case the subjective intention was indeterminable as the original annexor was not there. The objectively assessed intention was used to determine the annexor’s intention. 19 Van der Walt and Pienaar Introduction to the Law of Property (n 1 above) 107. 20 Konstanz Properties (Pty) Ltd v Wm Spilhaus en Kie (WP) Bpk (n 17 above) 284. 21 1990 (1) SA 173 (T); See (n 7 above) 299. 22 Van der Walt and Pienaar Introduction to the Law of Property (n 1 above) 107. The authors hold that this decision is correct. 23 Ibid. 24 See (n 11 above) 143. 16 5 acquisition is “original and independent of the cooperation or title of the previous owner” 25. The enquiry into whether the owner/annexor intended to pass ownership is irrelevant in determining the (non-)occurrence of inaedificatio, and relates to study of the real agreement which fits in with “the derivative acquisition of ownership”26. By attaching too much weight to the intention of the owner/annexor in deciding whether inaedificatio has occurred, the courts have in essence drifted away from the premise of the principle of accession, namely that it depends not on “an act of will, but takes place by operation of law”27. In determining whether inaedificatio has taken place, regardless of the case circumstances, the focus should always be on whether or not the movable is an accessory to the immovable property28. The presence of a reservation of ownership clause, in Melcorp and Konstanz served to blur the real issue which is, “whether or not the movable was an accessory to the immovable”29 30 . Pope states that although the intention underpinning the attachment is a relevant consideration, it must be considered rationally and must be deduced from the two factors (that is, objectively)31. It too must be noted that in the English law, the (non-)occurrence of inaedificatio is determined by looking at the degree of physical annexation and the purpose of the annexation, both of which are determined objectively and the subjective intention of the owner/annexor is largely irrelevant in determining whether a building/structure becomes a fixture and therefore a part of the land32. Conclusion The subjective intention of the owner/annexor is an irrelevant consideration in determining the (non-)occurrence of inaedificatio as it does not form a part of the South African common law (Roman-Dutch) relating to inaedificatio and it should play no continued role in determining the Badenhorst, Pienaar and Mostert Silberberg & Schoeman’s The law of property (n 4 above) 201-239; See decision in Gamedze v Cardoso [2004] SZHC 86. 26 See (n 11 above) 144. 27 Carey Miller DL “Fixtures and auxiliary items: Are recent decisions blurring real and personal rights?” 1984 SALJ 205 210. 28 See (n 11 above) 127. 29 Ibid 145. 30 Ibid 142. Pope adds that but for presence of the reservation of ownership clause in Melcorp, the court would have confirmed the occurrence of inaedificatio. 31 Ibid 127. An objectively assessed intention is consistent with the principles of inaedificatio which does not take into account subjectivity. 32 See (n 7 above) 303. 25 6 (non-)occurrence of inaedificatio. It is for this reason that it is submitted that the various approaches, that is the ‘traditional approach’ as confirmed in MacDonald (in so far as it looks into the annexor’s subjective intention in the face of an equivocal join), the ‘new approach’ (whereby the owner’s/annexor’s subjective intention is decisive in the determining whether inaedificatio has occurred), and the ‘omnibus approach’ (in so far is it considers the subjective intention of the annexor), are misdirected and incorrect. The intention surrounding the attachment is a relevant consideration only when faced with an equivocal result after considering the two factors, to the extent that the intention is determined logically and is inferred from the two factors (see Standard-Vacuum and Theatre decisions). The use of subjective intention is not only in conflict with the principles of inaedificatio but with the publicity principle too, as it creates uncertainty for buyers and creditors and in most instances, has served to trump the visibly obvious (see Melcorp case). 7 BIBLIOGRAPHY Badenhorst PJ, Pienaar JM & Mostert H Silberberg & Schoeman’s The law of property (5th ed 2006) Durban: Butterworths Carey Miller DL “Fixtures and auxiliary items: Are recent decisions blurring real and personal rights?” (1984) 101 SALJ 205-211 Carey Miller DL The acquisition and protection of ownership (1986) Cape Town: Juta Gamedze v Cardoso [2004] SZHC 86 Knobel I “Accession of Movables to Movables & Inaedificatio – South Africa and some Common Law Countries” (2011) Journal of Contemporary Roman-Dutch Law, Vol. 74, p. 296304 Konstanz Properties (Pty) Ltd v Wm Spilhaus en Kie (WP) Bpk 1996 (3) SA 273 (A) MacDonald Ltd v Radin NO and Potchefstroom Dairies and Industries Co Ltd 1915 AD 454 Melcorp SA (Pty) Ltd v Joint Municipal Pension Fund (Transvaal) 1980 (2) SA 214 (W) Olivier and Others v Haarhof & Co. 1906 TS 497 Pocock v De Oliveira and Others [2006] ZAGPHC 245 Pope A “Inaedificatio revisited: Looking backwards in search of Clarity” (2011) SALJ 128(1)123-146 Route BV and Others v Sunspun Bananas (Pvt) Ltd and Another [2010] ZWHHC 27 Standard Vacuum Refining Co. of SA (Pty) Ltd v Durban City Council 1961 (2) SA 669 (A) Sumatie (Edms) Bpk v Venter en ‘n Ander NNO 1990 (1) SA 173 Theatre Investments (Pty) Ltd v Butcher Brothers Ltd 1978 (3) SA 682 (A) Van der Walt AJ & Pienaar GJ Introduction to the Law of Property (6th ed 2009) Cape Town: Juta