how to avoid … the 10 deadly sins that estate agents make
TRANSCRIPT
How to avoid …
The 10 Deadly Sins that Estate Agents Make
Estate Agency Affairs Board Continuing Professional Development
Presented by Tiaan (M C) van der BergEstate Agency Affairs Board
Copyright: M.C. van der Berg Attorneys, Conveyancers & Notaries INC. ©
1. Death (contract is void)
2. Contract can die (voidable)
3. Civil claim
4. Embarassment
5. Bad name in market
6. Cut commission
7. Complaint at EAAB
8. Frustration
9. Waste of time
Copyright: M.C. van der Berg Attorneys, Conveyancers & Notaries INC. ©
are personal in nature;
are inherited in your pro forma agreements;
are organized by the parties to the agreement;
are habitual;
exist because you don’t apply your mind;
is the result of the agent doing theconveyancer’s work;
Copyright: M.C. van der Berg Attorneys, Conveyancers & Notaries INC. ©
By acquiring the necessary knowledge;
Using a proper pro-forma agreements of sale;
Applying your mind;
Using a conveyancer that you can rely on;
Copyright: M.C. van der Berg Attorneys, Conveyancers & Notaries INC. ©
SIN 1:
Understanding the various Matrimonial Property Systems
Copyright: M.C. van der Berg Attorneys, Conveyancers & Notaries INC. ©
1) The Marriages Act;
2) The Civil Union Act;
3) The Recognition of Customary MarriagesAct;
4) Muslim / Hindu Marriages;
5) Another Country’s laws (regardless whichone);
Copyright: M.C. van der Berg Attorneys, Conveyancers & Notaries INC. ©
1) Matrimonial Property Act
Marriage Act
Civil Union Act
Muslim marriages (under certain conditions)
2) Recognition of Customary Marriages Act
3) Muslim (in certain cases)/ Hindu Marriages
4) Another Country’s laws
Copyright: M.C. van der Berg Attorneys, Conveyancers & Notaries INC. ©
e.g.
• Peter John Smith
• Id 720101 5186 086
and
• Susan Johnson
• Id 710203 0816 081
1 Estate
Copyright: M.C. van der Berg Attorneys, Conveyancers & Notaries INC. ©
e.g.
• Fredrich Smal
• Id 820203 5160 082
and
• Susan Smal
• Id 811112 0123 085
Copyright: M.C. van der Berg Attorneys, Conveyancers & Notaries INC. ©
1) The Marriages Act;
2) The Civil Union Act;
3) The Recognition of Customary MarriagesAct;
4) Muslim / Hindu Marriages;
5) Another Country’s laws (regardless whichone);
Copyright: M.C. van der Berg Attorneys, Conveyancers & Notaries INC. ©
Civil Marriage
Property dispensations are regulated bythe Matrimonial Property Act i.e.
In community of property – ByDefault
Out of community or property - ANC
Copyright: M.C. van der Berg Attorneys, Conveyancers & Notaries INC. ©
1) The Marriages Act;
2) The Civil Union Act;
3) The Recognition of Customary MarriagesAct;
4) Muslim / Hindu Marriages;
5) Another Country’s laws (regardlesswhich one);
Copyright: M.C. van der Berg Attorneys, Conveyancers & Notaries INC. ©
Same sex couples;
Civil Marriages;
Property dispensations are regulated bythe Matrimonial Property Act i.e.
In community of property – ByDefault;
Out of community or property – ANC;
Copyright: M.C. van der Berg Attorneys, Conveyancers & Notaries INC. ©
1) The Marriages Act;
2) The Civil Union Act;
3) The Recognition of Customary Marriages Act;
4) Muslim / Hindu Marriages;
5) Another Country’s laws (regardlesswhich one);
Copyright: M.C. van der Berg Attorneys, Conveyancers & Notaries INC. ©
Partners married i.to. customary law(labola);
Legal position previously – uncertain;
Now regulated by Recognition ofCustomary Marriages Act;
Promulgated on 15 November 2000;
Act incorporates the matrimonialproperty dispensations of theMatrimonial Property Act;
Copyright: M.C. van der Berg Attorneys, Conveyancers & Notaries INC. ©
1) The Marriages Act;
2) The Civil Union Act;
3) The Recognition of Customary MarriagesAct;
4) Muslim / Hindu Marriages;
5) Another Country’s laws (regardless whichone);
Copyright: M.C. van der Berg Attorneys, Conveyancers & Notaries INC. ©
If: Muslim Marriage concluded before 1 May 2014
No Civil marriage Not regarded as married Can contract independently
If: Muslim Marriage concluded after 1 May 2014 (but not a civil marriage)
Not regarded as married Spouses can contract independently
If: Muslim Marriage concluded after 1 May 2014 (and is a civil marriage)
Recognized by Marriage Act
Regulated by Matrimonial Property Act
• Default = In community of property
• ANC = Out of Community of property
Copyright: M.C. van der Berg Attorneys, Conveyancers & Notaries INC. ©
1) The Marriages Act;
2) The Civil Union Act;
3) The Recognition of Customary MarriagesAct;
4) Muslim / Hindu Marriages;
5) Another Country’s laws (regardlesswhich one);
Copyright: M.C. van der Berg Attorneys, Conveyancers & Notaries INC. ©
Still regarded as not married;
Parties can contract independently;
Copyright: M.C. van der Berg Attorneys, Conveyancers & Notaries INC. ©
1) The Marriages Act;
2) The Civil Union Act;
3) The Recognition of CustomaryMarriages Act;
4) Muslim / Hindu Marriages;
5) Another Country’s laws (regardlesswhich one);
Copyright: M.C. van der Berg Attorneys, Conveyancers & Notaries INC. ©
We don’t know if spouses are in/out ofcommunity;
Regulate legal position to protect spouses;
Who must sign?
Differentiate between
NB! Consent, not necessary a party to agreement per se!
SIN 2:
Representation
Copyright: M.C. van der Berg Attorneys, Conveyancers & Notaries INC. ©
Juristic person/ Legal entities
Quasi juristic
person
Natural Person (human beings)
Companies
Closed Corporations
Trust
Other- church, club etc.
But 1 problem!
Copyright: M.C. van der Berg Attorneys, Conveyancers & Notaries INC. ©
Is duly authorized
If signatory is indeed duly authorized
Agent can’t assume that
Director (Company)
Member (CC)
Employee
Official
∴ Obtain a resolution &
Hold representative contractually liable!
Copyright: M.C. van der Berg Attorneys, Conveyancers & Notaries INC. ©
Companies
Copyright: M.C. van der Berg Attorneys, Conveyancers & Notaries INC. ©
Company
JJJ (Pty) Ltd
1999/01235/07
Directors- Johannes Koopman- John Buyer- Julius Thenga
= Resolution appoints
Regulated by the Companies Act 71 of 2008
Copyright: M.C. van der Berg Attorneys, Conveyancers & Notaries INC. ©
Snapshot Pty Ltd
Registration number 1999/01235/07
Herein represented by Johannes Koopmanduly authorized thereto.
Copyright: M.C. van der Berg Attorneys, Conveyancers & Notaries INC. ©
PU
RC
HA
SE
R
Purchaser One
Name: ABC (Pty) LtdReg. No: 1999/012345/07 herein represented by theundersigned and duly authorized thereto being AlbertKoopman
Purchaser Two
Name: ___________________________________________________________________Id / Reg No: ______________________ herein represented by the undersigned and duly authorized thereto being
N/A
Copyright: M.C. van der Berg Attorneys, Conveyancers & Notaries INC. ©
Indeed authorized
Duly authorized
Internal compliance
External compliance
Trust Property Control Act
Companies Act
Close Corporations Act
MOI
Trust deed
Cooperation Agreement
Constitution
Copyright: M.C. van der Berg Attorneys, Conveyancers & Notaries INC. ©
Company: Closed Corporations
a) Before signature of agreement;
b) After signature of agreement(ratification);
Trust
a) Only before signature ofagreement’
If resolution is signed aftersignature of contract – contractis void (Adriaanse vs Investec)
Copyright: M.C. van der Berg Attorneys, Conveyancers & Notaries INC. ©
SIN 3:
Uncertain aboutTransfer Duty and/or VAT
Always Transfer Duty Act or VAT Act
Transfer Duty Act vs. VAT Act
Never both: Transfer Duty Act and VAT Act
Do you pay VAT on Coke at Spar ?
Are you registered for VAT?
Is Spar registered for VAT?
Copyright: M.C. van der Berg Attorneys, Conveyancers & Notaries INC. ©
Copyright: M.C. van der Berg Attorneys, Conveyancers & Notaries INC. ©
SIN 4:
Misunderstanding the sources of funds
Copyright: M.C. van der Berg Attorneys, Conveyancers & Notaries INC. ©
Deposit
Bank loan
Investment
Subject to transaction
Copyright: M.C. van der Berg Attorneys, Conveyancers & Notaries INC. ©
SIN 5:
Not addressing Fittings & Fixtures correctly
Copyright: M.C. van der Berg Attorneys, Conveyancers & Notaries INC. ©
Differentiate
Fixtures vs Fittings
Fixtures
Part of property
Sell with property
Seller cannot take with
Fittings
Not part of Property
Seller can take with
Copyright: M.C. van der Berg Attorneys, Conveyancers & Notaries INC. ©
FIXTURES FITTINGS
• Garage door motor • Mirror
• Kreepy Krauly • Curtains
• Remotes • Furniture
• Lights • Pot plants
• Bathroom towel rails
• Swimming pool
• Trellis doors
Copyright: M.C. van der Berg Attorneys, Conveyancers & Notaries INC. ©
WHAT ABOUT ?
• DSTV - dish • Pelmets
• TV - antenna • Mirrors
• Blinds • Microwave oven
Copyright: M.C. van der Berg Attorneys, Conveyancers & Notaries INC. ©
How do we distinguish between Fittingsand Fixtures?
No hard and fast rule;
Guidance by courts;
Intention of person who attached it?
Way of attachment?
Damage if removed?
Does item form a unit with theproperty?
Copyright: M.C. van der Berg Attorneys, Conveyancers & Notaries INC. ©
SIN 6:
Suspensive Conditions
Copyright: M.C. van der Berg Attorneys, Conveyancers & Notaries INC. ©
Typically two types:
Bond and / or (Sin 6.1)
Subject-to Transaction (Sin 6.2)
Copyright: M.C. van der Berg Attorneys, Conveyancers & Notaries INC. ©
When will the suspensive conditions be fulfilled?
Copyright: M.C. van der Berg Attorneys, Conveyancers & Notaries INC. ©
When all the suspensive conditions
are met……
In Full &
In time
Copyright: M.C. van der Berg Attorneys, Conveyancers & Notaries INC. ©EAAB 2016 - 10 Deadly Sins
49
Copyright: M.C. van der Berg Attorneys, Conveyancers & Notaries INC. ©
SIN 6.2:
Subject-to Transaction
Copyright: M.C. van der Berg Attorneys, Conveyancers & Notaries INC. ©EAAB 2016 - 10 Deadly Sins
51
Copyright: M.C. van der Berg Attorneys, Conveyancers & Notaries INC. ©
SIN 7:
Lease Agreement“Huur gaat voor koop”
Copyright: M.C. van der Berg Attorneys, Conveyancers & Notaries INC. ©
When concluding a sale agreement,determine if the property is currentlyunder a lease agreement;
Obtain a copy of the lease agreement;
Establish the following:
Valid lease agreement?
Period of lease?
Notice period?
Termination date?
Letting agent involved?
Deal with position of tenant;
Copyright: M.C. van der Berg Attorneys, Conveyancers & Notaries INC. ©
“Huur gaat voor koop”
Roman-Dutch law
Incorporated in the South African Law
If lease is signed before sale agreement
Purchaser must honour leaseagreement
only applies to lease agreementsshorter than 10 years
Copyright: M.C. van der Berg Attorneys, Conveyancers & Notaries INC. ©
Landlord
Tenant
Copyright: M.C. van der Berg Attorneys, Conveyancers & Notaries INC. ©
Landlord
Tenant
Purchaser
Copyright: M.C. van der Berg Attorneys, Conveyancers & Notaries INC. ©
Landlord
Tenant
Purchaser
Must honour lease
agreement
Copyright: M.C. van der Berg Attorneys, Conveyancers & Notaries INC. ©
Seller 1
Initial
Sel
ler
The seller confirms that the property is notleased to a tenant on date of signature of thisagreement *.
The seller confirms that the property is leasedto a tenant on date of signature of thisagreement and the situation is accordinglyregulated by Annexure G.
Seller 2
Initial
*Delete which is not applicable. Seller initial.
TENANT OCCUPYING THE PROPERTY
The Seller undertakes not to enter into any leaseagreements for the duration of this sale agreementwithout the prior written consent of the purchaser
Copyright: M.C. van der Berg Attorneys, Conveyancers & Notaries INC. ©
High Risk for Purchaser;
“Huur gaat voor koop”;
3 options:
1) Lease agreement is ceded topurchaser;
2) Delay transfer till termination oflease;
3) Expedite termination of lease;
Copyright: M.C. van der Berg Attorneys, Conveyancers & Notaries INC. ©
SIN 8:
Disregarding the seriousness of Occupation
Copyright: M.C. van der Berg Attorneys, Conveyancers & Notaries INC. ©
These issues must be conditions beforeoccupation!
The occupational rent paid (+ provisionsfor utilities);
Deposits paid – guarantees delivered;
Costs are paid (transfer & bond);
Transfer and bond documentation signed;
Documents that need to be provided(FICA etc.);
The transfer duty receipt is received fromSARS;
Copyright: M.C. van der Berg Attorneys, Conveyancers & Notaries INC. ©
SIN 9:
Misinterpreting the ambit of theConsumer Protection Act
Copyright: M.C. van der Berg Attorneys, Conveyancers & Notaries INC. ©
Promote and advance the social andeconomic welfare of consumers;
Promoting fair business practices;
Protecting consumers;
Improving consumer awareness andinformation and encouragingresponsible and informed consumerchoice and behaviour;
Promoting consumer confidence andempowerment;
…… etc;
Copyright: M.C. van der Berg Attorneys, Conveyancers & Notaries INC. ©
CPA is a blanket Act!
Applicable to all transactions!
While it is limited in its ambit
Copyright: M.C. van der Berg Attorneys, Conveyancers & Notaries INC. ©
only applicable to “Transactions”;
Consumer ;
someone who enters
into a transaction
with a supplier
Supplier ;
someone who delivers
a product /service
in the normal course of business
To a consumer
Copyright: M.C. van der Berg Attorneys, Conveyancers & Notaries INC. ©
Aim of CPA is to:
Regulate relationship between
suppliers consumers
i.e. Makro / Joe Soap
Aim of CPA is not to:
Regulate relationship between
non-suppliers non-consumers
i.e. Joe Soap / Suzy Snail
Copyright: M.C. van der Berg Attorneys, Conveyancers & Notaries INC. ©
SIN 10:
Barking on behalf of the conveyancer
Copyright: M.C. van der Berg Attorneys, Conveyancers & Notaries INC. ©
What is your responsibility
vs
The Conveyancers responsibility
Validity of agreement
Addendums
Legal Advice
Disputes
Copyright: M.C. van der Berg Attorneys, Conveyancers & Notaries INC. ©
Bond Conditions & Approval
Copyright: M.C. van der Berg Attorneys, Conveyancers & Notaries INC. ©
Subject-to Transaction
Occupation
Copyright: M.C. van der Berg Attorneys, Conveyancers & Notaries INC. ©
Tenants
Copyright: M.C. van der Berg Attorneys, Conveyancers & Notaries INC. ©
COC’s
Gas Certificate
Electric Fence Certificate
Gas Certificate
Electric Compliance
Invasive Vegetation
Beetle Certificate
Copyright: M.C. van der Berg Attorneys, Conveyancers & Notaries INC. ©
THANK YOU