Make sure you understand the sale agreement before you sign!

Once you have signed the sale agreement, you cannot claim ignorance of the contents of the agreement. It is highly recommended that you obtain legal advice before signing an agreement, to assist you in identifying any possible risks.

It is also preferable for the parties to annex a “defects list” to the agreement of sale when signing, as this will avoid a situation where the seller claims a defect was disclosed to the purchaser verbally, but the purchaser disputes this claim.

Ensure that you have checked whether transfer duty is applicable to the sale, or whether Value Added Tax will be levied in addition to the purchase price, which at 15% could be quite an unexpected shock.

If your agreement is subject to any suspensive conditions, it is critical that the agreement is clear as to how the suspensive conditions must be fulfilled and by when. It must also be clear when suspensive conditions are deemed to be fulfilled. Recent case law has outlined situations where the sellers and purchasers have held differing views as to what constituted fulfilment of suspensive conditions, with resultant devastating consequences, including cancellation of the sale and damages claims.

When it comes to occupation of the property, be wary of “occupation” and “possession” clauses. If the parties agree to early occupation, this should not be confused with possession of the property. In normal circumstances, possession of the property passes to the purchaser on registration of transfer.

Make sure you understand each and every clause. If you do not take care in preparing the most important part of the sale, it could result in misunderstanding, expensive litigation and disappointment.