The 10-year “lease” trigger (s 1)
The Sectional Titles Act 95 of 1986 defines the word ‘lease’ — but only for the purposes of section 17(1) (the common-property letting power). That definition mirrors the threshold used throughout long-lease law and operates as the statutory trigger for the body corporate’s special resolution requirement. The Act states:
‘lease’ for the purposes of section 17 (1) means a lease which-
(a) was entered into for a period of not less than ten years;
(b) was entered into for the natural life of the lessee or of any other person mentioned in the lease; or
(c) is renewable from time to time at the will of the lessee indefinitely or for periods which, together with the first period, amount in all to not less than 10 years;
Note — This definition was inserted by s. 1(d) of the Sectional Titles Amendment Act 44 of 1997. It applies only to the body-corporate letting power in s 17(1); the general obligation to register a long lease notarially arises under the Deeds Registries Act 47 of 1937 and the threshold there (10 years / natural life / aggregating renewals to 10 years) is the same in substance.
The three limbs correspond exactly to the long-lease threshold that governs notarial execution under the Deeds Registries Act. A lease of a unit that clears any one of those three limbs must be notarially executed and registered; so must a lease of common property — except that the common-property pathway also requires the body corporate to first obtain a unanimous resolution before the deed can be executed. The sections below work through each registration pathway in turn.
A long lease of a unit (s 15B)
The most common scenario is a landlord (an owner of a sectional title unit) granting a long lease of that unit to a tenant. The lease must still be notarially executed — the sectional title context does not change that — but the registration mechanism is different from a long lease over freehold land. Section 15B(1)(b) of the Sectional Titles Act provides:
the registrar shall register any notarial lease of a unit or an undivided share in a unit and any notarial cancellation or modification of such a lease by means of an endorsement made by him on the sectional title deed, and he shall register any notarial sub-lease and any notarial cession of such a lease or sub-lease and any notarial cancellation or modification of such a sub-lease by means of an endorsement made by him on the lease in question: Provided that if any such lease or sub-lease has lapsed by effluxion of time, the registrar shall cancel the registration on production of proof that the lease or sub-lease has so lapsed;
Note — S 15B was inserted by s. 10 of the Sectional Titles Amendment Act 63 of 1991. Sub-s (1) opens with the words 'When a sectional title register has been opened and the sectional plan concerned has been registered' and then sets out paragraphs (a) through (d); paragraph (b) covers notarial leases and sub-leases. The endorsement mechanism replaces the ordinary title-deed endorsement procedure applicable to freehold land.
Several points follow directly from this provision:
- The registration vehicle is an endorsement on the sectional title deed. Unlike a long lease over freehold land — where the lease is endorsed on the title deed of the land — a notarial lease of a unit is endorsed on the sectional title deed of the unit. The Deeds Registry holds the sectional title deed; the endorsement constitutes the public record that binds successors in title and creditors of the unit-owner.
- Sub-leases and cessions follow the same mechanism. A notarial sub-lease or a notarial cession of the registered lease is itself endorsed on the lease deed (not on the sectional title deed). The hierarchy is maintained.
- Cancellations and modifications also require notarial execution. A registered long lease of a unit cannot be cancelled or materially modified by a private agreement; the cancellation or modification must itself be notarially executed and registered as an endorsement on the sectional title deed or the lease, as the case may be.
- Lapse by effluxion of time. When the registered term expires, the registrar will cancel the registration on production of proof of lapse — for example, a certificate from the lessor confirming the lease has expired — without a separate notarial deed of cancellation being required.
The notarial execution requirements are the same as for any notarial long lease: both parties must sign before a notary public and the deed must be registered for the full term, including any renewal options (section 77(1) of the Deeds Registries Act, read with the proviso). No body-corporate consent is required for a lease of a unit — consent from the body corporate is a feature of the common-property pathway only.
A long lease over common property (s 17)
Common property belongs to all unit owners in proportion to their quotas; no single owner can grant a long lease of it unilaterally. Section 17 of the Sectional Titles Act imposes a two-stage process: first, a unanimous resolution of the body corporate; second, registration of the notarial lease against the schedule of conditions, not on the unit title deeds. The letting power is conferred by section 17(1):
The owners and holders of a right of extension contemplated in section 25 may by unanimous resolution direct the body corporate on their behalf to alienate common property or any part thereof, or to let common property or any part thereof under a lease, and thereupon the body corporate shall, notwithstanding any provision of section 20 of the Deeds Registries Act, but subject to compliance with any law relating to the subdivision of land or to the letting of a part of land, as the case may be, have power to deal with such common property or such part thereof in accordance with the direction, and to execute any deed required for the purpose …
Note — Sub-s (1) was substituted by s. 11(a) of the Sectional Titles Amendment Act 44 of 1997. The 'right of extension' reference (s 25 or s 60(1)(b)) concerns a developer's registered right to extend the scheme; if such a right exists, the holders must participate in the resolution before common property can be alienated or let. The proviso deals with cancellation of that extension right on alienation and is not relevant to a letting.
Three points demand attention:
- A unanimous resolution is mandatory. The Act does not permit a special resolution or a majority vote; the letting of common property under a long lease requires the agreement of all members of the body corporate (with the 80% quorum and at-least-30-days notice requirements set out in the s 1 definition of ‘unanimous resolution’). A resolution passed by majority — however large — does not satisfy this requirement.
- The body corporate executes the deed as agent. The owners authorise the body corporate by unanimous resolution; the body corporate then acts on their behalf. Section 17(2) requires that a copy of the resolution, certified by two trustees of the body corporate, must accompany the transaction — and where the transaction must be notarially executed (as a long lease must be), that certified resolution is produced to the notary public and retained in the notary’s protocol.
- Registration is against the schedule of conditions, not the unit deeds. Section 17(3)(c) states that the registrar registers a notarial lease of common property by making an appropriate endorsement against the schedule of conditions referred to in section 11(3)(b), and no endorsement is made on the sectional title deeds of the units. Where the lease covers only a portion of the common property, a diagram of the portion approved under the Land Survey Act must be annexed to the deed of lease.
The practical consequence is significant: a prospective purchaser of a unit searching only the unit’s sectional title deed will not see a registered long lease of common property. The schedule of conditions is a separate document in the sectional title register, and a full register search — not merely a title-deed search — is essential before purchasing into a scheme where the common property may be encumbered.
Exclusive-use areas (s 27(6))
An exclusive-use area is a portion of the common property that has been formally delineated on the sectional plan and registered in favour of a specific unit owner for their exclusive use — typically a parking bay, a garden, a storeroom, or a balcony that extends beyond the building envelope. Once the right to such an area is registered by means of a certificate of real right, the law treats it as if it were its own parcel of urban immovable property. Section 27(6) states:
A right to the exclusive use of a part of common property registered in favour of an owner of a section, shall for all purposes be deemed to be a right to urban immovable property over which a mortgage bond, lease contract or personal servitude of usufruct, usus or habitatio may be registered.
Note — Sub-s (6) was substituted by s. 4 of the Sectional Titles Amendment Act 7 of 2005. This provision addresses a gap that existed when exclusive-use areas were delineated under body-corporate rules rather than registered as real rights: only a registered exclusive-use area (a real right, not a rule-based right) falls within sub-s (6). A rule-based exclusive-use arrangement under s 27A does NOT create the rights contemplated in s 27(6) — see s 27A(a).
The practical consequences of this deeming provision are significant:
- A long lease of a registered exclusive-use area is registrable as such. Because the right is deemed urban immovable property, a long lease of it can be notarially executed and registered — in exactly the same way as a long lease of a unit under section 15B(1)(b). The body-corporate unanimous-resolution mechanism of section 17 does not apply; the registered holder of the exclusive-use right (who is an individual unit owner) is the lessor and can grant the lease themselves.
- Mortgage bonds and personal servitudes may also be registered. The exclusive-use area can be hypothecated as security for a loan (a mortgage bond registered over it) or subjected to a personal servitude of usufruct, usus or habitatio — useful where a unit is owned by a company or trust but a specific individual is entitled to enjoy the parking bay or garden.
- Only registered exclusive-use areas qualify. An exclusive-use arrangement that exists only by virtue of body-corporate rules (under section 27A) does not create rights within the meaning of section 27(6). Section 27A itself states, at paragraph (a), that such rules “shall not create rights contemplated in section 27 (6)”. A rule-based exclusive-use right cannot be leased or mortgaged in the same way; only a real right registered under a certificate of real right achieves that status.
Where a long lease is intended to cover both a unit and its appurtenant exclusive-use area, the notarial deed should describe both the unit and the exclusive-use area clearly, and the Deeds Registry will register the lease by endorsement on the sectional title deed (for the unit component) and, separately, by endorsement on the certificate of real right for the exclusive-use area (for that component). Getting this right at the drafting stage prevents complications on registration.
For the full procedure for notarial execution and lodgement at the Deeds Registry that applies across all three pathways, see How a Notarial Long Lease Is Registered. For the foundational question of when a lease first crosses the threshold that requires registration, see What Is a Long Lease? The 10-Year Rule.