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How does the amendment of the Property Practitioners Act affect the “voetstoots” clause?

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When in the process of purchasing the home of your dreams, you might find yourself viewing several properties before finding the home you have always imagined. The presence of Patent and/or Latent Defects can make purchasing that dream home an extremely dreadful process. The Property Practitioners Act of 2019 aims at addressing this issue.

Property Sale Agreements: Voetstoots Clause

Most immovable property sale agreements should include a clause stating that the buyer agrees to buy the property voetstoots. The voetstoots clause states that the buyer will purchase property from the seller “as is”, indemnifying the seller from any claims for damages arising from any defects in the property. In the event that a defect is discovered after the property has been sold, the onus is on the buyer to prove that the seller knew about the defects(s) and intentionally and fraudulently concealed it from the buyer during the conclusion of the sale.

To determine whether the defect(s) were intentionally concealed, the court will use objective factors as was held in the case of Roux v. Zietsman and Another (HCA10/2020) [2021] ZALMPPHC 79 (2 November 2021).  It can be extremely difficult for the buyer to argue that the seller knew about the defect(s) and intentionally concealed same. This creates an ambiguity. The Property Practitioners Amendment Act is of importance in such a situation.

The Property Practitioners Act: Defects List

The Property Practitioners Act of 2019 (PPA) became operative on 1 February 2022. The PPA is very similar to the “voetstoots” clause as it makes it obligatory for parties to sign a complete and comprehensive Defects List which will form part of the offer to the purchase/sale agreement. This document is then presented to the purchaser and provides complete transparency between seller and purchaser regarding the condition of the property. As a result, if an owner grants a real estate professional the authority to sell their property on their behalf, the real estate professional is prohibited from doing so unless they have a complete list of all known patent and latent defects.

In terms of Section 67 of the Act, a property practitioner may not accept a mandate if this form is not produced. The Act stipulates that if this form is not produced, it will be assumed that any flaw or deficiency in the property was not disclosed to a prospective buyer or lessee. It also states that a property practitioner who accepted a mandate without attaching this form to the agreement of sale or lease, may be held accountable by the prejudiced consumer.

Prevention of disputes between buyers and sellers.

The creation of compulsory condition reports has taken a great leap in the prevention of disputes between buyers and sellers. Although the PPA Amendment and the voetstoots clause are similar, the PPA protects the seller to a larger extent in comparison to the voetstoots clause. This does not mean that because of the PPA amendment, the voetstoots clause is nullified as the condition report does not constitute a warranty on the part of the seller. Instead, it allows for complete honesty between the buyer and seller of the immovable property and creates legal restrictions should the mandate not be complied with.

Article written by Jayde de Wet with technical assistance by Erika Oosthuizen.

For more information, contact 021 871 1200 or email contact@faurefaure.co.za

Faure & Faure Inc. – Your partner in Law in the Paarl and Boland Area.

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