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Summary LAW OF PROPERTY LECTURE 9
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POSSESSION'AND'HOLDERSHIP!!
!
RIGHTS'IN'PROPERTY'AND' • The!3!most!N.B!categories!of!real!relationships!=!OWNERSHIP;'POSSESSION;'HOLDERSHIP!
• The!distinction!between!these!3!categories!of!real!relationships!is!based!on!the!question!of!
CONTROL'OF'CORPOREAL'THINGS:! actual'physical'control'–'this!absence!of!presence!of!physical!control!is!very!N.B.!in!making!
! !
these!distinctions!
CONTROL'
!!!!!
! !
DEFINITION:'physical!control! LAWFUL' UNLAWFUL'
of!corporeal!things!is!generally!
defined!as!actual,!physical!
holding!or!domination!of!a!
corporeal!thing! 1st'owner'='Game'!
Game!was!original!owner!of!TV.!! Current'owner'='ABSA'Bank!
! National!Credit!Act!34!of!2005!provides!that!
Game!sold!TV!to!EarlyBird!in!terms!of!a!credit!
agreement.!As!soon!as!credit!agreement!was! ownership!of!object!vests!in!credit!grantor!(bank)!
concluded,!ownership!was!transferred!to!ABSA!as! until!final!instalment!of!purchase!price!has!been!
credit!grantor!and!thereafter!Game!lost!all!interest! paid.!If!it!is!assumed!that!final!instalment!has!not!
and!involvement!with!TV.!Game!WAS!owner,!but! yet!been!paid,!bank!is!still!owner!of!property.!
EXAMPLE: Bank!has!a!property!right!i.e.!OWNERSHIP!!
now!retains!NO!further!property!relation!with!TV!!
X"has"a"TV"in"his"home."He"leases" !
!
this%TV%from%a%rental%company% Thief'='Z'!
Z!stole!TV!set!and!established!a! Lessee'='X'!
(EarlyBird),#who#in#turn#bought#
property!relation!by!physically!taking! X!leases!TV!and!is!person! Credit'purchaser'='EarlyBird'!
TV#set,#together#with#a#few#
control!of!it.!Relation!is!UNLAWFUL! who!is!allowed!to!actually! EarlyBird!bought!TV!in!terms!of!a!credit!
hundred'other'TVs,'from'a'retail'
and!does!not!amount!to!a!property! use!it!–!X’s!right!derives! agreement!and!is!therefore!credit!
outlet&(Game)&in&terms&of&a&credit&
right.!Confiscating!authority!=!police.! from,!and!depends!on,! receiver,!who!will!become!owner!of!
agreement.)Credit)transaction)
Police!have!established!a!property! position!of!EarlyBird!and,! object!upon!payment!of!final!instalment.!
was$financed$by$ABSA$Bank.$One$
right!in!terms!of!their!statutory!power! ultimately,!ABSA.!X!has!a! Until!then,!EarlyBird!is!not!owner,!
night,'TV'set'is'stolen'from'X’s"
to!confiscate!stolen!property!–!this! property!right!i.e.! although!it!has!a!right!to!use!TV!as!part!of!
home.&A&few&days&later,&it&is&found&
right!does!not!allow!them!to!use!this! (secondary)!RIGHT!OF!USE.! its!business!stock!–!this!right!derives!
in#possession%of%a%suspected%
property,!but!only!to!HOLD!IT!IN! Property!relationship!here! from,!and!depends!on,!ownership!of!
criminal((Z)(and(confiscated(by(
©!Alda!Vorster! ! !
SAFETY!until!legal!situation!can!be! is!based!on!a!creditor’s!right! ABSA.!EarlyBird!has!a!property!right!i.e.!
police.((
established!in!court.!! (lease!agreement)!! RIGHT!OF!USE!!
! ! !
!
!!!!!
! !
©!Alda!Vorster! ! !
, !
Categories*of*Real*Rela.onships:*
OWNERSHIP* POSSESSION* HOLDERSHIP*
IS#THE#CONTROL#OF#SOMEBODY#ELSES#PROPERTY#
ALWAYS*LAWFUL* ALWAYS*UNLAWFUL*
!!!!! CAN#BE*LAWFUL*OR*UNLAWFUL*
! !
Always#requires#physical*control***********************************************Always#requires#physical*control****************
INTENTION* Inten.on*of*owner* Inten.on*to*derive*a*benefit**
RELEVANT:** (control#property#as#owner)#
Lawful*holder* Unlawful*holder*
• Person#who#physically#
Bona*fide*possessor* Mala*fide*possessor* controls#the#thing#with#
• Person#who#does#
• Controls#thing#on#incorrect#assumpGon# • Person#is#aware*of#fact#that#he#is#not*lawfully* not*regard*or#
owner’s*permission*or#
that#he#is#owner# recognised*owner#of#a#thing,#since#he#does#not# conduct#himself#as#
another#legal*basis*to*
• Person#is#not#recognised#as#owner# conform#to#the#requirements#of#ownership# owner*but#
derive#a#benefit#from#it##
because#he#does#not#comply#with#the# but#who#nevertheless#has#the#intenGon#of# recognises*and#
• This#holder#does*not*regard*
requirements#for#establishing#ownership# owner## respects#the#
himself#as*owner*not#does#
• Person#is#unaware*of*the*fact*that#he# • i.e.#thief# owners*ownership*
he#pretend#to#be#owner#
does*not*meet*all*the*requirements*of# • This#relaGonship#is#unlawful#however#if#has# to#the#thing#but#
• He#exercises#control#of#the#
ownership# certain#legal#consequences## who#physically*
thing#while#recognising*and#
• i.e.#person#who#concludes#contract#of# controls*it#for#the#
respecGng#the*owner’s*
sale#with#a#thief;#or#person#who# sake#of*the*benefit*
ownership*
accidently#picks#up#another#persons#pen# he#derives#from#it##
• i.e.#lawful#borrowers;#
believing#it#to#be#his##
purchasers#on#credit#who#
• NOTE:#bona#fide#possessors#control#of#
have#not#paid#all#
thing#is#unlawful#as#he#takes#up#right#that#
installments;#pledgee;#
is#not#legally#recognized#BUT#the#control# usufructary# 7#
sGll#has#legal#consequences#
©!Alda!Vorster! ! !
!
Unlawful(holder(
Bona(fide( Mala(fide((
• A"person"who"physically"controls"the"thing" • Person"who"knows"that"he"does"not"have"owner’s"
unlawfully"but"is"unaware"of"the"fact"since" consent"to"control"thing"but"s<ll"exercises"control"over"
he"is"under"the"incorrect"impression"that" it"for"the"sake"of"the"benefit"he"can"derive"from"it"
he"has"the"necessary"permission"or"legal" • i.e."lessee"who"remains"on"the"leased"premises"a?er"
ground"to"control"it" the"lease"has"expired""
• i.e."lessee"who"has"unknowingly"concluded"
an"invalid"lease"agreement"
Ownership,'possession'and'holdership'can'be'classified'as'distinctive'Categories'of'physical'control':'
'
!!!!
! !
2.'As'owner'for'own'benefit!
• Distinction!between!ownership!and!
!!1.'Lawful'or'unlawful! possession!on!the!one!hand!and!the!2!
• 'first!distinction!based!on! forms!of!holdership!on!other!is!based! 3.!Good'faith'or'bad'faith!
lawfulness:!ownership!and! on!the!fact!that!holdership,!whether! • Depends!on!intention!of!
lawful!holdership!are!the! lawful!or!unlawful,!is!control!of! controller!
only!forms!of!lawful!control.! somebody!else’s!property! !
• Possession!and!unlawful! • Owner!and!unlawful!possessor!
holdership!are!forms!of! control!the!property!as!owners,!while!
unlawful!control! holders!control!someone!else’s!
©!Alda!Vorster! ! !
! property!for!their!own!benefit! 8"
!
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