A lot has been written about the formalities of sale agreements of immovable property. The Alienation of Land Act determines that no alienation of land shall be of any force or effect unless it is contained in a deed of alienation signed by the parties thereto or by their agents acting on their written authority. Agreements of sale of immovable property are therefore one of the few contracts that must be recorded in writing.

The essentialia or material terms of such agreements are the following: a description of the seller and the purchaser, a description of the property, and the determination of the purchase price. Although the essentialia will constitute a valid sale agreement, it won’t be sufficient to regulate the legal consequences of a sale of immovable property. The Alienation of Land Act further makes provision for the contents of contract for a sale agreement of immovable property, which must be incorporated in the deed of sale.

The agreement must contain the names of the purchaser and the seller (or owner) as well as their residential or business addresses. A full description and extent of the property which is sold should be included in the agreement. The purchase price should be determined, the method of payment, as well as the date on which the purchase price becomes payable by the purchaser. This will constitute the essentialia of the agreement.

If the property is encumbered by a mortgage bond, the name and address of the person, or his representative or, in the case of a participation bond, the name and address of the nominee company, or its representative, in favour of whom the mortgage bond over the land is registered at the time the contract is concluded, should be stipulated in the agreement.

It is important to note that transfer duty is payable and to determine which party is responsible for the payment thereof (usually the purchaser). It might further be wise to determine the amount of transfer duty payable in the agreement to avoid any unnecessary disputes between the parties after signature of the agreement.

The dates on which and the conditions on which the purchaser shall be entitled to take possession of the property must be included in the agreement. It is also required to state the date on which the risk, profit and loss of the property shall pass to the purchaser. The date of transfer should also be included in the agreement.

Although not prescribed by the Alienation of Land Act, other important clauses to include in a sale agreement to regulate the sale of immovable property, are the following:

•    Defects and Voetstoots clauses;
•    Any suspensive conditions;
•    Occupational interest, if applicable;
•    Estate agents’ commission;
•    Parties’ Domicilia Citandi Et Executandi;
•    Breach of contract and Jurisdiction clauses;
•    Compliance certificates; and
•    Fixtures and fittings.

Most estate agencies have standard drafted sale agreements in place. However, it is of the utmost importance that the deed of sale is a custom-made agreement to suit the needs and requirements of both the seller and the purchaser. It is further important that both parties are aware of and understand the contents of the agreement, to avoid unnecessary disputes. Always consult an attorney to review your sale agreement should you be uncertain of any of the contents of the agreement.


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