An Offer to Purchase is the same thing as a Sale Agreement
An Offer to Purchase (OTP) becomes a legally binding contract once it has been signed. The word “offer” is misleading in the sense that purchasers think they can simply withdraw the offer if they change their minds. This is not the case. An Offer to Purchase is simply another term for a Sale Agreement.
Who chooses the conveyancing attorney?
It is custom in our law of conveyancing that the seller nominates the conveyancer however this can be changed by agreement between the seller and purchaser. In terms of the Property Practitioners Act 22 of 2019, an estate agent may not prescribe which conveyancer is nominated. The estate agent may suggest a few conveyancing firms but it must be the seller or purchaser’s decision which to nominate.
How you are married matters
If the sellers are married in community of property then both will need to sign the sale agreement and all transfer documents. The same thing applies to purchasers married in community of property. If the seller is a foreigner then the spouse of the seller must also sign the offer to purchase.
Does the voetstoots clause apply or is the purchaser covered by the Consumer Protection Act (CPA)?
If the seller is a private seller, and not an investor, speculator, trader, builder or developer, then he/she is not dealing with the property “in the ordinary course of business” which means that the voetstoots clause from our common law will apply. For this reason, the seller should always attach a full disclosure report of the condition of the property.
Is the property being bought in another entity?
Different rules apply for entities buying property. A trust needs a trustees’ resolution before the sale agreement is signed. All trustees must have capacity to act by virtue of Letters of Authority. A company requires a director to sign on its behalf and the company documents will specify the names of the directors. A deceased estate requires the executor of the estate to sign all documents – the executor must have Letters of Authority issued by the Master of the High Court and the latter must specifically approve of the sale of the property.
Does the seller need copies of approved plans for the property?
It is not a legal requirement that approved plans must be produced before the property can be registered in the purchaser’s name. However, it is advisable for purchasers to ask for the plans and even to make it a condition of sale that approved plans be provided by a certain date as well as who will bear this cost.
Alterations to the contract
Any alteration to a contract needs to be accepted by all parties and signed/initialled by all parties. Any change made without all signatures will be invalid.