Friday, October 19

‘Voetstoots’ clause catches seller on wrong foot

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A court judgment serves as a warning to sellers who think the “voetstoots” clause will prevent them facing any action related to defects in the properties they sell.

A South African court judgment serves as a warning to sellers who think the “voetstoots” clause will prevent them facing any action related to defects in the properties they sell.

It is believed inserting this clause will negate any legal action arising from latent flaws, but the country’s courts have ruled otherwise.

According to law firm Cliffe Dekker Hofmeyr Inc (CDH), the seller is automatically held liable for latent – invisible – defects, whether or not she/he knew of them at the time of the sale. To avoid this common law liability, a voetstoots clause included in a sale agreement is thought to protect the seller from any action which the purchaser may institute should a latent defect be discovered.

But CDH attorneys Natasha Fletcher and Muhammed Gattoo say a recent judgment serves as a warning to sellers there are instances where the voetstoots clause offers no protection.

Fletcher and Gatoo say a couple bought a wooden house with the back built into a slope and the front on stilts. The sale agreement contained a voetstoots clause stating the seller would not be responsible for any latent (invisible) or patent (visible) defects, or answerable for any warranties either expressed or implied. It also stated the buyers confirmed they were satisfied with the condition of the property.

After registration of transfer, the couple started renovating the house and discovered a number of defects.

These included:

Two sections of the kitchen floor had been cut out and later replaced to give access to the area below. The floor had subsided at the outer edges so the middle was higher than the sides.

The house was no longer level as a result of subsidence on the northern side due to severe decay in the foundation supporting it.

A cement screed had been poured over the wooden floors which were then carpeted and tiled over, and a false ceiling had been constructed and suspended from the original ceiling, all to create the illusion the house was level.

The lounge floor had been raised with wooden wedges to conceal the subsidence.

Cladding had been applied to the outside of the house, also to conceal the subsidence.

“The purchasers instituted action for cancellation of the sale agreement stating they would not have bought the property if they had known about the defects. Alternatively, they claimed a reduction in the purchase price or damages,” say Fletcher and Gattoo.

The seller, while acknowledging that some of the defects were latent, claimed she had been unaware of some of the underlying conditions, and was, therefore, protected by the voetstoots clause.

After considering what constituted a latent defect and whether the seller was protected, the court ruled in favour of the buyers, finding the seller had known about some of the defects and failed to tell the buyers.

The court found the seller had not considered the significance of her non-disclosure and that, by her actions, she had intended to defeat the provisions of the voetstoots clause.

Fletcher and Gatoo warn: “The fear of not selling a house or achieving the desired asking price should not deter a seller from making a full disclosure of all defects, patent or latent, whether or not the seller considers them significant.”

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