The decision handed down by the Supreme Court of Appeal in City of Tshwane Metropolitan Municipality v PJ Mitchell (hereinafter “Mitchell”) has turned property law in south Africa and the industry on its head. This judgement relates to the interpretation of section 118(3) of the Local Government: Municipal Systems Act 32 of 2000 as amended.
According to Gladwin,The Supreme Court of Appeal held that the hypothec (sometimes referred to as a lien) to secure amounts owing by the owner of a property council in lieu of rates and services, is not extinguished by transfer of the property. This regardless of whether the sale that led to the transfer took place as a sale in execution, or in any other fashion.
This article will briefly explore some of the key implications of this judgement.
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