I21. General and Special Clauses

1. Legal Domicile

A legal domicile address is an address where the seller or the purchaser currently resides and where the sheriff of the court can deliver any notice. These details must be comprehensively filled in on pages 7 & 8. As a Practitioner, you are responsible for ensuring all parties have completed these pages in full. If there is missing information, obtain the information and complete your OTP. Also, if you are not filling in the details yourself, ensure you can read what they have written before submitting it to your principal. Please note that it is not a postbox address. The courts require a physical address where the party can be found.

1. Sold Board

For as much as possible, you as a Property Practitioner want to display a sold board. Sold boards are part of the company’s marketing tools and are very important for market exposure. Exceptions may arise when this becomes a threat to the wellbeing and safety of the occupier.

1. Tax Issues

If either party’s taxes are not in order, the deal will be held up by SARS when the conveyancers call for their transfer duty receipt. SARS will require the taxes to be sorted out before issuing the receipt for the deal to proceed.

1. Sufficient Funds to Effect Transfer

The cost summary included in the offer to purchase should help the seller determine whether they have sufficient funds available to cover the commission, cancellation of any mortgage bonds together with interest, outstanding municipal accounts and clearances, cancellation attorney costs, as well as other incidental costs. It is the seller’s responsibility to ensure they can cover all these costs and/or make arrangements for their payment.

IT IS NOT THE PROPERTY PRACTITIONER’S RESPONSIBILITY TO ENSURE THAT THE SELLER HAS SUFFICIENT FUNDS AND IS NOT, AND SHOULD NOT, FEEL OBLIGED TO SACRIFICE THEIR COMMISSION BECAUSE OF A SELLER’S FINANCIAL SITUATION.

1. Boundaries and Servitudes

It is the responsibility of the purchaser to find out about any municipal servitudes over the property and on the title deeds. While it is beneficial for you as a Property Practitioner to obtain this information and to know if any issues could arise, it is not within the duties of your mandate. These are legal issues, and the purchaser needs to be satisfied that they will take care of these matters should they wish to know about them.

1. Gender

Any words in the offer that imply a singular pronoun such as “I” also include we, us, them, they, etc. Any words in the contract using the word “he” includes she and any other gender someone may wish to be referred to.

1. Personal Information – POPI

With the new POPI Act, you are not allowed to give or send someone’s personal information to someone else. In our line of business, we must send personal information to third parties involved in the fulfilment of the contract. With this clause, each party is giving us as Property Practitioners the right to transmit their personal information to the parties stipulated above. However, for any other person outside of the above, it is not permissible for you, as a Property Practitioner, to transmit or give this information to any other persons.

Take note of the SAGH Code of Conduct and IT policy.

1. VAT

If the seller is a VAT vendor, then there are special clauses that need to be included in the agreement dealing with the payment of the VAT. If there is no stipulation regarding the VAT, then the law assumes the VAT is INCLUDED in the purchase price. Consult your special clauses notes for the correct wording.

See additional training notes.

1. Indemnity

The word indemnity means security or protection against financial liability. In our case, it is specifically to indemnify the Property Practitioner from any responsibility for any information supplied to the party on behalf of a third party regarding their banking details. Contractually, neither the seller nor the purchaser should be accepting any banking details from the Property Practitioner. If they do so and the information is incorrect and they suffer loss, they cannot hold the Property Practitioner or agency responsible.

This is generally where fraud takes place, as clients are given false bank accounts, either by a Property Practitioner committing fraud, or an external hacker falsifying emails and diverting banking details.

Should you, as a Property Practitioner, give details to either party for the payment of monies, you have committed a breach of your employment/service agreement and can be held liable by the Company for fraud.

1. Be Precise with Dates and Amounts

Often one or both of the parties to a sale have not agreed on a date or amount, and the Property Practitioner has to find suitable words to postpone the issue until later.

A typical example is in the occupational clause which, when it says, ‘occupation will be given to the Purchaser on _________’, is filled in with the words ‘to be agreed’. Fortunately, here the law agrees that occupation will be on transfer if the parties have not specifically agreed otherwise.

But in many other cases, serious problems can arise. If the buyer says, ‘I will only pay the balance of the purchase price in cash not more than a week before lodgement,’ and you write in ‘balance payable 7 days before lodgement,’ your conveyancer will have a problem. They can’t tell what those 7 days will be at any time and will have to wait until they are actually ready to lodge before they give their Purchaser 7 days’ notice to pay.

‘Deposit payable on a bond grant’—that’s fine; the date can easily be ascertained once the bond is granted.

But ‘Purchase price payable on transfer’ is disastrous—it means the Purchaser is only obliged to pay it once the transfer has taken place. That is intolerable.

Be careful not to leave dates of payment of any amount uncertain, which applies to the amount. 

The same is applicable where the date of acceptance is concerned. The purchaser has the right to give the seller a certain amount of time in which to accept the offer, after which the offer will lapse and be of no further force or effect. If no date has been inserted, the seller has “forever” to decide, leaving the purchaser bound to the contract indefinitely, while the seller looks for a better offer.

Finally, make sure the date of signature for all parties is filled in, as often other clauses, for example, a bond due date, are determined by this date. If there is no date, then the purchaser could end up having all the time they want to obtain a bond. Furthermore, it validates when the parties made their decision to enter into the agreement.

Last but not least—most importantly!! 

Make sure that the principal dates and signs accepting the benefits of the agreement. This is acceptance of the commission, and failure to sign this could be interpreted as a waiver of your commission!