According to Black’s Law Dictionary 7th edn (West Group, 1999)

#1 the verb ‘deem’ means ‘To treat something as if

(1) it were really something else, or

(2) it has qualities that it doesn’t have;

#2 To consider, think or judge.

“[49]     In CA Fours CC[1] Cachalia JA pointed out[2] that the use of the word “deemed” is often “not a very happy one, because that term may be employed to denote merely that the person or things to which it relates are to be considered to be what really they are not”.

[50]     In Mouton v Boland Bank Ltd,[3] the Supreme Court of Appeal cautioned[4] that “the intention of a deeming provision in laying down a hypothesis, is that the hypothesis shall be carried as far as (is) necessary to achieve the legislative purpose but no further”, and there is “no need to extend the bounds of an imaginary state of affairs” further than is necessary in order to give effect to a statute’s legislative purpose”.[5]

Excerpts without footnotes from Harbour Terrace Body Corporate v Minister of Public Works (2556/2016) [2016] ZAWCHC 87; [2016] 3 All SA 766 (WCC) (8 July 2016) where the high court considered the deeming provision in s 48 of the  Sectional Titles Act  (STA).

Further excerpts

[28]     With that introduction as a background, it is apposite to set out the provisions of sub-section (1), on which the applicant seeks to rely:

“48.     Destruction of or damage to buildings

  1.   The building or buildings comprised in a scheme shall, for the purposes of this Act, be deemed to be destroyed –(a)   upon the physical destruction of the building or buildings;(b)   when the owners by unanimous resolution so determine and all holders of registered sectional mortgage bonds and the persons with registered real rights concerned, agree thereto in writing; or(c)   when the court is satisfied that, having regard to all the circumstances, it is just and equitable that the building or buildings shall be deemed to have been destroyed, and makes an order to that effect”.

[29]     Notwithstanding the wording of the heading, from a reading of the body of the sub-section it is apparent that damage alone will not suffice, and what is required for the section to be applicable is destruction.  In this regard it covers both actual as well as notional ‘deemed’ destruction, which may be effected either by the members of a scheme acting unanimously, or by a court on application to it.

[30]     Insofar as s 48(1) provides that a building or buildings within a scheme, which are physically (and thus actually) destroyed, shall also be “deemed” to be destroyed, the wording appears to be tautologous.

[31]     Be that as it may, it is evident that apart from the situation where a building or buildings in a scheme is/are physically destroyed, the section also envisages that notional or hypothetical destruction may occur when either the owners by unanimous resolution so determine[6] (subject to certain conditions in this regard)[7] or when a court is satisfied that, having regard to all the circumstances, it is just and equitable that the building or buildings in a scheme shall be deemed to have been destroyed, and it makes an order to that effect.

[32]     Prof CG Van der Merwe, in his work Sectional Titles, Shareblocks and Timesharing,[8] aptly comments that it is difficult to summarise the provisions of ss 48 and 49, as they are “very confusing”.   In his view, the provisions are intended to apply both to the actual destruction of the buildings in a scheme (whether partial or total) as well as to the notional destruction thereof due to obsolescence ie where a building in a scheme becomes unsuitable for its original purpose

“not only through the physical deterioration of the structure but also because of functional obsolescence, namely the loss of its competitive positions vis-à-vis other projects in view of technological advances and evolving concepts in building design and materials”,[9] or for “any other sound economic reason, for example where the cost of major replacements and renovations would be excessive, where the land is not fully or suitably developed, where the value of the land has become disproportionately large in relation to the value of the buildings thereon, or where it would be more viable economically to replace a residential project in the particular area with commercial or industrial buildings or offices or to permit the extensive modernisation of a commercial project”.[10]

[33]     In seeking to give meaning to the provisions in question it is important not to consider the sub-section in isolation, but in the context of the section as a whole, as well as in the context of the related sections (ie ss 49 and 50), and the Act as a whole, including the definitions set out therein.[11]