MAIN IMAGE: Clive Sinclair Hendricks, chairperson of the Cape Town Attorneys Association (CTAA); Heather van der Spuy, principal Steer International Properties; Herschel Jawitz, CEO Jawitz Properties.
The Cape Town Deeds Office is in deep trouble. Since reopening on 12 May, it was closed and reopened twice and then operated with such a small staff contingent that the number of backlogged deeds had piled up to an astronomical 14 000 by middle June.
At the beginning of June the deeds office was closed for days without a notice to explain if Covid-19 decontamination was taking place or an indication of when the office will reopen.
The turnaround time for lodging at this deeds office has slowed to 27 days. This is in stark contrast to the average turnaround time of 5-6 days at the deeds offices in Johannesburg or Pretoria. As a result of the delays the time periods on municipal rates clearance certificates expired for many of the backlogged deeds, which meant further delays as the certificates will have to be issued anew.
Conveyancers and estate agencies grew increasingly exasperated by the slow processing of deeds and having to explain the delays to frustrated and often desperate buyers and sellers.
Frustration with this untenable situation last week led to an urgent application to the Cape High Court made by Cape Town Attorneys Association (CTAA) together with the Tygerberg Attorneys Association and the Institute of Estate Agents of South Africa (IEASA Western Cape). Cited as respondents in the matter are the minister of agriculture, land reform and rural development, the chief registrar of deeds, the acting registrar of deeds Cape Town, the minister of public works and minister of cooperative governance and traditional affairs.
Upon receiving the application on Friday 12 June, the Cape High Court ordered that the city’s deeds office had to reopen on Monday 15 June. This Friday 19 June the other issues on the case will be heard.
Reaction from the real estate sector
For estate agencies depended on the Cape Town Deeds Office to process their property transactions, the stop-start functioning with such reduced capacity has been a nightmare. “It’s been a roller coaster of conflicting information as to whether the offices in the Western Cape were operational,” says principal Heather van der Spuy of Steer International Properties in Cape Town.
“This certainly has a huge impact on the sellers and buyers who were expecting their properties to have been transferred many months ago. Their question is always WHEN is my property going to be registered and it is difficult to predict. The ramifications re removal dates etc. are most frustrating. One of my clients has cancelled her relocation three times.
I am sure that there will still be a significant delay as there must be quite a backlog of deeds to process,” she says and adds that hopefully the office will soon be at its full potential.
The situation is very serious agrees Herschel Jawitz, CEO Jawitz Properties. “We have clients who are also impacted by the closures. Sellers are waiting for the proceeds from the sale of their homes which in some cases are to be used for the purchase of a new property and buyers find themselves in an uncertain situation about their moving date,” he says. In addition Jawitz says that the frustration does need to be tempered in terms of the safety of the people working in the deeds office but that it remains unclear as to whether the closures are as a result of a lack of the correct safety protocols or other factors.
Also commenting on the situation, Dr Andrew Golding, chief executive of the Pam Golding Property group says, they are delighted that the Cape Town Deeds Office will be reopening. “However, the most obvious effect of the fact that certain deeds offices have opened intermittently is that there has effectively been a continuation of the lockdown environment with dramatically reduced income for real estate agents from property transfers since lockdown. This also has a severe economic impact on the agencies themselves as there has been markedly reduced income or cash flow for nearly three months now,” he says.
The fact is, without an operational Deeds Office system property transactions cannot be finalised. “As it is, the closure during the lockdown has had a major impact on the industry. As we have moved to Level 3, role players in the industry have hit the ground running to restore some sense of normalcy and work towards recovering some of the ground lost due to the lockdown and we really need the same commitment from the Deeds Offices,” adds Samuel Seeff, chairman of the Seeff Property Group.
What’s the plan going forward?
In their affidavit Clive Sinclair Hendricks, chairperson of the CTAA, explains that they had exhausted all avenues to find a remedy for the situation and was left with no choice but to take legal action. “The situation was and is unacceptable and unfair to the general public, legal practitioners, estate agents and various other stakeholders,” he says.
According to the CTAA court statements the Cape Town Deeds Office had approximately 600 deeds in their system when the country went into lockdown on 27 March. After the office reopened on 12 May, another 11 977 were lodged up to 3 June, however by 4 June only ± 17% of the lodged matters were registered.
One of the reasons was that only a small percentage of the staff have been reporting for work. The CTAA says currently only approximately 18 staff members have been regularly reporting for work. This despite a government announcement that from 12 May a third of the staff could report back to work which translates roughly to 60 staff members. From 8 June the number of employees at work could grow to 50% or around 100 employees – this has not happened says the CTAA.
He further states that the Registrar of Deeds had not been able to provide their association, its members or the public with an indication that a plan exists to normalise the operations at the Deeds Office and to work away the current backlog within the shortest period of time. For instance, the CTAA asks why the offices can’t be decontaminated every weekend as is the case already at many courts.
“This is precisely why the CTAA asked for a plan that specifically deals with the backlog. The backlog is a huge concern and needs to be addressed with focused intervention strategies,” Hendricks told Property Professional this week.
This week Chief Deeds Registrar Carlize Knoezen told the media that they had challenges in Cape Town from the start. She says for starters, they are carefully watched by the unions for compliance issues. The lodgement volumes have also doubled since the office reopened in May. A further complication is that this deeds office shares the building with other tenants including Parliament and the Surveyor. Should any of these report exposures to someone who tested positive for Covid-19, then the whole building must close for decontamination. Multi-tenant buildings could thus close more often for decontamination than others where the deeds office is the only tenant, Knoesen explains.
Knoezen says the office plans to work from 15 June with 58% of senior staff and 54% of the junior complement. She expected the Cape Town Deeds Registry to submit their action plan to deal with the backlog by Monday 15 June.
Hendricks on Wednesday 17 June said they were still waiting to receive the answering affidavits of the respondents wherein they deal with their intervention plans and Covid-19 specific standard operating procedures.