Advice and Opinion

Non-Compliant Sellers (Or Buyers) Can Wreck Property Deals

A recent case handled by Denver Vraagom, a conveyancer with Gunston Attorneys in Cape Town, has shown how difficult and wearying the negotiations can be in a property transaction, if one party refuses to acknowledge his contractual obligations.

Sometimes this can be rooted in pure obstinacy, for example where a seller changes his mind about his earlier decision to sell. Consider the following scenario: Once an offer to purchase has been signed, the transferring conveyancer sends a request to the conveyancer handling the buyer’s mortgage bond. This request needs to specify how the bond proceeds should be paid, usually in the form of a guarantee payable into a specific account. By not furnishing the required specifics, the seller can frustrate the purchaser’s ability to comply. We have seen it happen, says Vraagom, that a seller then tries to use this non-compliance as a basis for cancellation, despite the buyer’s best efforts to do so.

Where a seller shows this kind of intention to get out of a sale, the buyer is faced with a choice to litigate in order to enforce their rights. “While these rights were strong and we would have been happy to assist them in bringing a High Court application to enforce them, the pragmatics often outweigh the legal position. While buyers in circumstances like this might be extremely upset about the seller’s conduct”, says Vraagom, “they need to weigh not only their legal position but also facts like that they may have given notice on their existing rented premises, their need to move into an area, and of course how badly they want the house considering what else might be available in the market.”

“In our experience as conveyancers” says Vraagom, “it is interesting to see not only the variety of circumstances that arise, but also the varied reactions from people to these circumstances. It is the job of a good attorney to provide guidance and advice that takes both the legal position and the clients’ unique needs into account.”

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