The real agreement as causa for the transfer of immovable property

The difference between the causal and abstract theories of transfer of ownership has been discussed extensively in property law textbooks1 and journals,2 mostly with the emphasis on movable property. Initial judgments on this topic dealt with the requirements for the transfer of movable property only.3 It is but in the last few years that judgments have been reported regarding the application of the principles of the abstract theory to the transfer of ownership of immovable property.4 The purpose of this article is not to repeat the abovementioned historical and comparative research,5 but to indicate how the abstract theory of transfer of ownership and the concomitant principle in respect of a valid real agreement are applied to the transfer of immovable property in terms of the negative deeds registration system in South Africa.6 Not only the theoretical difference between the abstract and causal systems of transfer of ownership has to be taken into consideration in the case of immovable property, but also practical requirements of the registration system. It is an accepted principle of South African law that the mere registration of an immovable (traditio) is not sufficient to transfer ownership. In the case of the derivative acquisition of ownership, the mutual intention of the parties to transfer and accept ownership is the distinguishing factor from the original passing of ownership from one person to another, where such an intention is lacking or not required.7 The intention to transfer and accept ownership is embodied in an agreement between the parties to this effect. During the development of the South African law it was in dispute, for a long time, whether the intention was based on a valid obligatory agreement between the parties as the basis for the transaction (the causal theory of transfer of ownership), or whether this intention could be deduced from other aspects of the transaction between the parties (the abstract theory of transfer of ownership).8 The way these principles are being applied in the case of immovable property has been dealt with in only the latest judgments on the topic.9