The Valuation of Property for Claimants is a complex and time driven exercise often involving a multitude of disciplines e.g. Historical Researchers, Actuaries but most important the Claimants Attorney and Counsel.

Since its inception, we have assisted the Land Claims Commission, the then Department of Land Affairs and in recent years the Department of Rural Development. In addition, Jerry Margolius was a member of the task team that assisted the Government with the Establishment of the Office of the Valuer General and the Property Valuation Act in trying to identify the problems that we face when undertaking valuation  under the auspices of land restitution. Jurisprudence over the years is gaining momentum but several high powered and guiding cases are still making themselves going to the Constitutional Court.

The Land Restitution Act 1994 provides for the restitution of rights in land in respect of which persons or communities were dispossessed under or for the purpose of furthering the objects of any racially  based discriminatory law; to establish a Commission on Restitution of Land Rights and a Land Claims Court and to provide for matters connected therewith.

This legislation promotes the protection and advancement of persons, groups or categories of persons who are disadvantaged by unfair discrimination, in order to promote their full and equal enjoyment of rights in land. It allows claimants access to the Land Claims Court.

The Land Claims Court hears disputes arising from those the Restitution of Land Rights Act 22 of 1994 , the Land Reform (Labour Tenants) Act 3 of 1996 and the Extension of Security of Tenure Act 62 of 1997.

Understanding restitution

Since 1913 and in fact prior thereto, rights to land have been controlled  by some form of racial discriminatory laws and practices. Why do we need to understand this process from such early days.

Well, the valuation of land could originate to cases where land was set aside by the Queen Victoria (Sir George Cathcart) by means of a Land Grant to little Namaqua Hottentots or more recently,  The Ebenezer Community claim which we participated in dating back 1854 are examples of claims resulting in  extensive Deeds Office search and land knowledge  in order to perform what is inevitably an historical valuation.

We are all familiar with the term Group Areas which forms the basis in the majority of urban valuation briefs. These Acts could include the Native Land Act of 1913, Native Administration Act of 1927, Development Trust and Land Act of 1937. Asiatic Land Tenure Act of 1946, Group Areas Act 1950 & 1966, Rural Coloured Areas Act of 1963, Community Development Act of 1966.

In particular, the 1950 Group Areas Act addressed the provisions on  how to control ownership and occupation of land. However, it did not  adequately address the aspect as to how people were to be removed, as the Act simply provided the title of disqualified persons and disqualified companies for those who resided in demarcated areas.

Disqualified persons were able to retain ownership of their property in their lifetime but their heirs would be required to dispose of  the inherited property to a member of the applicable race group. Properties owned by disqualified companies were required to be disposed of within ten years.

The Group Areas Development Act of 1955 was subsequently passed. This Act dealt with the disposing and acquiring of disqualified properties now termed affected property. The Act could apply to any group but its application was not mandatory. However, once applicable all affected property would at first have to be offered to the Group Areas Development  Board. Only when the Board waived its rights could a sale take place.

The State refused to acknowledge that disqualified owners were entitled to compensation. The Board placed a basic value on the property. If the property was sold below the Basic Value, the Board would pay 80% of the difference between the basic value and the selling price. However, in the event of the selling price being higher, an appreciation levy  of 50% was payable.

The first group area proclamation after the Group Areas Development Act was Proclamation No.190 of 1957. The Department of Local Government and housing has advised that the Basic Values prescribed by regulation (Community Development Act, 1966 (Act 3/1966  Government Notice R734 dated 11th May 1962) required this value to be the market value as at 9th February 1961.

The introduction and legislated provisions of the Group Areas legislation could certainly not support the existence of an open market. But it must also be understood that sales of property owned by other race groups were also controlled and therefore, the sales of all property in South Africa until the 1990s were controlled.

Who is entitled to restitution

The Constitution of the Republic of South Africa, 1993 (Act No. 200  of 1993), provides for the restitution of a right in land to a person or community dispossessed under or for the purpose of furthering the objects of any racially based discriminatory law S25(7)  A person or community dispossessed of property after 19 June 1913 as a result of past racially discriminatory laws or practices is entitled, to the extent provided by an Act of Parliament, either to restitution of that property or to equitable redress.

The task of the land claims commission

The Land Restitution Act provides for the establishment of a Land Claims Commission.

The task of the Commission for the Restitution of Land Rights (CRLR) is to investigate and mediate land claims. It has drawn up guidelines, procedures and requirements for the lodging of land claims and other related matters. All land claims were to be lodged by 31 December  1998. However, the Restitution of Land Rights Amendment Act, 2014 extended the date for lodgement of land claims for those who did not claim by the initial deadline of 31 December 1998. The new deadline for the lodgement of land claims was extended to 30 June 2019.

No one will be able to claim land without substance. A claimant will have to prove that he or she was dispossessed after 1913 without adequate financial compensation or alternative land. Where legitimate claims are lodged for dispossessions that took place before 1913, the Minister of Land Affairs will consider giving preference to such claimants in terms of the redistribution programme.

Property Clause

An understanding of the property clause in Section 25(3) of the Constitution is essential.

Section 25 (3), deals with the circumstances relating to the compensation that was paid and other factors which need to be taken into account when dealing with this issue. You will note that the market value of property is only one of the factors which needs to be taken into account.

 Section 25 (3) property clause

(1)  No one may be deprived of property except in terms of law of general  application, and no law may permit arbitrary deprivation of property.

(2) Property may be expropriated only in terms of law of general application

1. for a public purpose or in the public interest; and
2. subject to compensation, the amount of which and the time and manner of payment of which have either been agreed to by those affected  or decided or approved by a court.

(3) The amount of the compensation and the time and manner of payment must be just and equitable, reflecting an equitable balance between the public interest and the interests of those affected, having regard to all relevant circumstances, including

1. the current use of the property;
2. the history of the acquisition and use of the property;
3. the market value of the property;
4. the extent of direct state investment and subsidy in the acquisition
5. and beneficial capital improvement of the property; and
6. the purpose of the expropriation. ….”

In addition, Section 33 of the Restitution of Land Rights Act, 1994  (Act 22 of 1994) provides for the Land Claims Court in addition to relevant provisions of the Constitution, to have regard to the following factors:

1. The desirability of providing for restitution of rights in land  for compensation to people who were dispossessed of their rights in land as a result of or in pursuance of racially based discriminatory laws;
2. the desirability of remedying past violations of human rights;
3. the requirements of equity and justice;
4. the desirability of avoiding major social disruption;
5. any provision which already exists, in respect of the land in question in any matter, for that land to be dealt with in a manner which is designed to achieve the goals contemplated in section 8(3)(a) of the Constitution; any other factor which the Court may consider relevant and consistent with the spirit and objects of the Constitution  and in particular the provisions of section 8 of the Constitution.

Jerry Margolius has participated in some of the most leading cases where successful claimants have had the benefit of a chosen team comprising of a Property Valuer (with knowledge in the field of land restitution), Historians (where required) supported by the Claimants Legal Teams and guidance from the Courts provided.