“Voetstoots” Clause Governing Property Transactions
Understanding the 'Voetstoots' clause in property transactions:
The New Property Practitioners Act, which came into effect on February 1, 2022, introduces important changes in the property sector. One significant aspect is the increased protection for consumers, including the requirement for sellers and landlords to disclose defects in both sales and rentals. This article aims to combine three articles to provide comprehensive insights into the disclosure rules, differentiating between latent and patent defects, and understanding the implications of the voetstoots clause.
I. Understanding Defects and Disclosure Obligations
1.1 Types of Defects:
Property defects can be categorized into two types: patent defects and latent defects.
a) Patent defects: These are visible flaws that can be observed during a reasonable inspection, such as cracks, damaged windows, or deteriorated woodwork.
b) Latent defects: Latent defects are not immediately noticeable and require specialized knowledge to identify, such as rising damp, faulty geysers, or leaking roofs.
1.2 Disclosure Obligations:
Under the Property Practitioners Act, sellers have a legal obligation to disclose all known defects to buyers. A disclosure form, completed and signed by all parties, must be attached to the respective sale or lease agreement. Failure to disclose defects can lead to
legal consequences for the seller. However, sellers are not liable for defects they were genuinely unaware of.
"Property defects can be categorized into two types: patent defects and latent defects"
II. The Importance of Condition Reports and Voetstoots Clause
2.1 Condition Reports:
A condition report is a document prepared by the seller that outlines the general condition of the property and lists any existing defects. It serves as an additional layer of protection for both parties and the estate agent. Buyers should review the condition report before making an offer and consider sharing it with a home inspector or attorney to assess potential legal issues.
2.2 Voetstoots Clause:
The voetstoots clause is commonly included in sale agreements and protects the seller against liability for latent defects unless
it can be proven that the seller deliberately concealed the defects. Buyers are responsible for thoroughly inspecting the property and should not rely solely on the condition report. However, if a seller knew about a latent defect and concealed it, they can still be held liable, despite the voetstoots clause.
III. Legal Protection and Advice for Buyers and Sellers
3.1 Consumer Protection Act (CPA):
Real estate transactions are generally not covered by the CPA unless the seller is a regular property seller or actively promotes themselves as such. Buyers should not solely rely on the CPA for protection in routine real estate transactions.
3.2 Record-Keeping and Expert Advice:
Maintaining a record of property defects through the property defects disclosure form is crucial. This documentation helps establish what defects were communicated to the buyer and can support the seller's position in case of disputes. While real estate professionals can offer general
advice, seeking qualified legal assistance is recommended if issues arise.
Final Thoughts
Understanding the disclosure rules and distinguishing between latent and patent defects is essential for both sellers and buyers in real estate transactions. The Property Practitioners Act emphasizes the need for disclosure, protecting consumers from unpleasant surprises. Additionally, the voetstoots clause and condition reports play important roles in determining liabilities and ensuring transparency. Seeking expert advice and conducting thorough inspections are crucial steps to avoid potential disputes and buyer's remorse in property transactions.