Louwrens Koen Attorneys
CONCLUDING A WRITTEN DEED OF SALE.
The Act prescribes certain information to appear in a deed of sale:
Supplemental information includes:
NOTE: Ownership does not pass on the date of the agreement, but only later on date of registration. Prior to registration the purchaser merely has a personal right to claim transfer of the property.
APPOINTMENT OF THE CONVEYANCER
According to the Common Law, it is the seller's prerogative to appoint a conveyancer of his choice to attend to the registration of the transfer of his immovable property.
Keep in mind however that several attorneys may be involved as one such transaction usually entails the following simultaneous actions:
Transfer of property from seller to purchaser;
Cancellation of sellers existing bond and Registration of purchasers new bond.
Different conveyancers therefore attend to the various transactions in this process. They are referred to as the transferring attorney (who handles the transfer), the cancellation attorney (who represents the financial institution of the seller existing bond) and the bond attorney (who effects the registration of the new bond in the name of the purchaser). For each of these different transactions there are different fees and expenses payable, respectively linked to the purchase price and to the amount of the bond to be registered.The estate agent or seller provides the conveyancer with the deed of sale. The conveyancer then proceeds to gather the necessary information and documentation to proceed with the registration process.This includes:
DRAFTING AND SIGNING OF DOCUMENTS
After fulfilment of all suspensive conditions e.g. granting of a loan and the obtaining of all relevant information, documents are prepared for signature by all the parties. Transfer documentation
Power of Attorney by which the seller empowers a conveyancer to appear before the Registrar of Deeds on his behalf to register the deed of transfer;
Insolvency and Marital Status Declarations by both parties to the transaction and Transfer Duty Declarations by both parties in terms of which details regarding the purchase price are declared to the Receiver of Revenue together with the payment of transfer duty.
Where a part of the purchase price is being financed by means of a loan, the purchaser will sign documentation at a conveyancer acting on behalf of a financial institution, for the registration of the bond over the property as security for the loan. The required documentation is usually the following:
Power of Attorney to pass the bond whereby the purchaser empowers a conveyancer to register the bond in favor of the financial institution who granted the loan;
Insolvency and Marital Status Declarations and standard documentation of the financial institution.
Each financial institution has its own set of required documentation to be signed before registration.
STATEMENT OF ACCOUNT
The statement of account regarding the transfer usually consists of the following:
The statement of account regarding the bond registration usually consists of the following:
Fees of the financial institution: This can include inspection fees, initiation costs, administration costs and other costs;
Bond fees: Prescribed by the Regulations, payable to the conveyancer and calculated on the amount of the bond to be registered;
VAT: On services rendered;
Provisions for postages and disbursements and Deeds Office Registration fee: Payable per registration.
The conveyancer is responsible to attend to a variety of financial arrangements during the registration process for example:
Collection of all costs as payable per statement of account;
Payment of transfer duty to the Receiver of Revenue and the obtaining of a transfer duty receipt;
Payment of rates and taxes/levies and obtaining a clearance certificate from the Local Authority or a levy certificate from the Body Corporate. (It is prescribed by law that no account for rates and taxes/levies payable by the existing owner shall be in arrears on the date of transfer);Guarantees are requested from the purchasers financial institution for the available amount of the loan, for the payment of the outstanding amount of the purchase price. (A guarantee is an undertaking by a financial institution to pay the amount as set out therein on date of registration);Arranging for the cancellation of the existing bond of the seller through the issuing of guarantees for the amount outstanding on the bond and Arranging payment of the balance purchase price.
The full amount of the purchase price must be available, (except where the deed of sale states otherwise) either by means of a guarantee or a cash deposit before registration. In accordance with the deed of sale, you may request that all deposits made by yourself must be invested in an interest bearing account in your favour, for payment on date of registration.
THE DEEDS OFFICE
Conveyancers attending to the various aspects of the transaction liaise with each other on a continuous basis to arrange simultaneous lodgement and registration of all the documents at the Deeds Office. The Deeds Office is a Government Registration Office and keeps record of all real estate transactions and rights regarding such properties.
There are offices in Pretoria, Johannesburg, Bloemfontein, Cape Town, Kimberley, Pietermaritzburg, Nelspruit and Vryburg. Each set of lodged documents is examined by Deeds Office officials to ensure that it complies with all relevant acts and regulations.
Afterwards it is made available to the various conveyancers for registration in the presence of the Registrar of Deeds. The linked set of documentation is registered simultaneously.
Registration renders the purchaser the registered owner of the property and his real rights are thus protected against third parties. All financial arrangements are usually finalized within 24 hours after registration. This entails the payment of guarantees by the purchasers financial institution, payment of the amount of the cancellation figure to the existing bondholder, payment of the balance purchase price to the seller and the setting of accounts with all parties.
HOW LONG DOES THIS PROCESS TAKE?
It is difficult to predict the exact duration of a transaction, the reasons being:
a. The deed of sale may be subject to suspensive conditions eg: - the sale and conclusion of registration of the purchaser's property within a certain time period and- the obtaining of a loan within a specified time period, before which the transaction does not proceed.
b. Government Offices and other institutions require certain time periods to deliver documentation or issue certificates necessary in the process e.g.:
- clearance certificates from the Local Authority or the Body Corporate (6-10 days);
- transfer duty receipts from the Receiver of Revenue;
- guarantees from the Financial Institutions (7-21 days);
- consents to cancellation from the existing bondholders (7- 14 days) and
- Deeds Office for registration (8-15 days).
Unforeseeable problems: the fact that so many institutions are involved in the registration process adds to unexpected delays (for example postal delays or unusual conditions of title which may prevent timeous finalisation of the transaction). All the above time periods may vary, but as a rule the usual duration of the registration process is 24 to 35 days after the confirmation of all financial arrangements.
What is a contract?
A contract is an agreement between two or more people in terms of which one party offers to do, deliver or not do something, and the other part accepts this offer. Usually, the party who accepts the offer must remunerate the other party or do something in exchange.
2. What are the requirements for a valid contract?
For a valid contract, the following must occur:
The parties must agree on all the essential terms thereof. One of the parties must make a firm offer to the other party and acceptance of the offer must, in turn, be communicated to the party who made the offer.
The parties to the contract must have the legal power to conclude such an agreement.
Minors, (persons under 18) or people who are mentally ill, for instance, may not enter into contracts.
Parties may not contract to do something illegal.
3. Must all contracts be in writing to be valid?
No. The most common of all misconceptions concerning contracts is that they must be in written form to be valid. If this were so, the majority of all contracts concluded daily would be invalid. Purchasing good, going to movies, using public transport and eating at a restaurant are examples of activities that include the conclusion of valid contracts as no specific legal formalities (such as reducing the contract to writing) are required. There are, however, exceptions and in certain specific instances, the law requires that the contract is in written form. If the parties do not comply with this requirement and one of the parties is unhappy with the outcome of the arrangement, then the arrangement cannot be enforced in some of the instances where writing is a requirement. Some important examples of contracts that must be in writing, with or without other formalities, are marriage contracts, donations, the sale of land (of which the hire-purchase agreement is an example).
4. What are the advantages of reducing a contract to writing, if the law does not require this in the specific instance?
The terms or contents of a contract are easily proved if the contract is reduced properly to writing. Remember that an attorney draws up contracts as part of his daily work and is thus able to express more clearly in writing what the parties intend. A party relying on an oral contract will probably have difficulty in proving the contents in a court of law.
5. What are the pitfalls of signing a written contract that has been drawn up by the other party?
The contract could contain terms that were not part of the verbal negotiations and which are included solely for the benefit of the other party. Conversely, the contract might not contain terms or stipulations to your benefit which were agreed upon during the verbal negotiations. Remember: when in doubt, consult an attorney and go through written agreements very carefully. Never sign a contract without reading it merely because you are in a hurry or want to rid yourself of an irritating salesman.
6. What is a breach of contract?
This means that one of the parties has in fact broken the agreement in one or more of the following ways:
He has not done or delivered what he promised regarding the contract.
He has not paid for goods delivered by the other party.
He has refused to carry out the contract.
He has prevented the other party from doing or delivering what the other party must do or deliver according to the contract.
He has delivered or done what he promised to do in terms of the contract, but his performance is defective and is completely useless or only of partial use to the other party.
He has, in fact, prevented himself from being able to perform regarding the contract.Where a party to a contract has breached the agreement, the innocent party should consult an attorney who will institute an action if necessary.
7. What may the purchaser do if he buys something that has a hidden fault?
The law states that the seller is responsible or liable for and hidden or latent faults that exist in the article bought if they were present at the time of sale. Purchasers should beware of buying something that is sold "voetstoots" or "as-is" or "as it stands" because in selling this way the seller has excluded his
responsibility or liability for any hidden faults.
8. What is a warranty or guarantee and how does it affect the buyer?
This is usually a statement made about a product by the seller which he promises to make good. For example, the seller may warrant that a particular television set he is selling will not break down in four years. If it does, then the seller will not break down in four years. If it does, then the seller must make good his promise and repair the unit at no extra charge. Purchasers should beware of guarantees that absolve the seller from liability for hidden defects in the article bought in exchange for relatively little protection for the buyer. Remember that not all or any representations made by a seller are guarantees. Therefore, ask the seller exactly what he means by a certain statement that relates to the product.If you are selling or buying property in South-Africa you can count on Conveyancing24.co.za to offer you a competitive written quotation. Our free written quotation will be fully itemised with no hidden costs. In just a few clicks you can receive a written conveyancing quote. Get started – Click HereFor further information or to book a consultation please contact us on:
Bloemfontein Registrar of Deeds
Mr David Mngcolwani (Registrar)c/o Nelson Mandela & Aliwal Str, Bloemfontein, 9300(051) 403-0342(086) 698-4947David.Mngcolwana(@)drdlr.gov.za
Johannesburg Registrar of Deeds
Ms Makaziwe Ntuli (Registrar)Marble Tower Building, c/o Jeppe & Von Weiligh Str, Johannesburg, 2000(011) 843-8300(011) 843-8407Makaziwe.Ntuli(@)drdlr.gov.zaking williams townMr Nkululeko Mantanga (Registrar)113 Alexandra Road, Private Bag X7402, King Williams Town, 5600(043) 642-2741(043) 642-4539Nkululeko.Mantanga(@)drdlr.gov.za
Mpumalanga Registrar of Deeds
25 Bell Street, Old BMW Building,
Private Bag X11239, Mbombela, 1200
Pretoria Registrar of Deeds
Adv. Audrey Gwangwa (Registrar)Merino Building, 140 Pretorius Street cnr Bossman Street, Tshwane, 0001(012) 338-7035(012) 338-7151Audrey.Gwangwa(@)drdlr.gov.za
Cape Town Registrar of Deeds
Mr Kasavel Pillay (Registrar)90 Plein Str, Private Bag X9073, Cape Town, 7975(021) 464-7601(021) 464-7725Kasavel.Pillay(@)drdlr.gov.za
Kimberly Registrar of Deeds
New Public Building: Floors 9-10, c/o Knight & Stead Str, Kimberley, 8301
Pietermaritzburg Registrar of Deeds
300 Pietermaritz Street, Private Bag X9028, Pietermaritzburg, 3200
Umtata Registrar of Deeds
c/o Owen & Leeds Street, Botha Sigcau Building, Mthatha,
Vryburg Registrar of Deeds
De Kock Street, Vryburg
The Deeds Office is responsible for the registration, management and maintenance of the property registry of South Africa. It also keeps copies of antenuptial contracts. Louwrens Koen Attorneys can also get the necessary information or copies on your behalf at a reasonable rate. For further information please E-mail firstname.lastname@example.org
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