In the majority of property sale agreements, you will more than likely come across the voetstoots clause : a common law principle that literally means sold “with a shove of the foot”.
All contracts have an implied warranty ie. that the property sold is free from any defects. However, the voetstoots clause means that what you see when buying the property, is what you get. This clause makes it possible for a seller to contract out of an implied warranty in a contract. A buyer would in such circumstance, accept the property as is, and renounce their right to claim against the seller if a defect is found.
That being said, a seller cannot hide behind the voetstoots clause if he conceals a defect or fails to disclose a known defect. This applies more in respect of latent defects – a defect which is not visible after reasonable inspection of the property. A seller would thus be liable to a buyer for all latent defects, at least for a period of 3 years from the date of sale. If a voetstoots clause is included in the contract, the seller cannot be held liable if the purchaser discovers latent defects, unless the buyer can prove that the seller was aware of such latent defects and failed to disclose them – never an easy task!
An example of where the seller could successfully rely on a voetstoots clause is in the case of Haviside v Heydricks & Another 2014 (1) SA 235 (KZP). In this case, the buyers of residential property discovered that there were no building plans for a garage on the property, and consequently that the pre-existing structure was illegal. The court held that while the absence of such approved plans was a latent defect, in this instance however, the seller was not aware of the latent defect, and thus could not be held liable. The knowledge of the seller is thus important, and the buyer must prove that the seller knew about the defect and deliberately concealed it.
The impact of The Consumer Protection Act (“CPA”)
While a seller may be able to rely on a voetstoots provision, the CPA should also be kept in mind: this act has, in certain instances, watered down the above common law principle insofar as the voetstoots provisions are concerned.
The CPA promotes a fair marketplace, including the buying and selling of property. A buyer is thus entitled to receive property that is reasonably suitable for the purpose for which it is intended and is of good quality and free of any defects. The CPA has an implied warranty of quality, as well as remedies available to a buyer, such as repair, replacement, and refund. While a warranty of quality is implied in every contract, it does not mean that full damages are always payable, as provided for in the CPA. In addition to the common law, there is now also a statutory duty of disclosure thanks to the CPA.
At the outset, it would be wise to determine if the CPA applies to your transaction. It will apply to contracts concluded in the ordinary course of business eg. by a developer who sells property, or if a company buys and sells property in the ordinary course of its business. In such instances, the voetstoots clause may not be included in a sale agreement to a consumer, and liability for defects in the property cannot be excluded by attempting to rely on such a clause.
A private sale of property would not fall within the ambit of the CPA, as such is not in the ordinary course of business. The CPA will also not apply to a transaction where the buyer is a juristic person with an asset value or annual turnover in excess of R2 million. In this instance, the voetstoots provision may be included in a sale agreement, and the transaction will not receive protection under the CPA.
With the above in mind, and to avoid any unpleasant and costly surprises, it is always advisable for a seller to disclose all defects as an annexure to the sale agreement when selling property.
If in doubt, always consult your attorney.
- On November 29, 2021
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