TYPICAL COST OF SELLING
Description of the property and parties
The property and parties must be properly defined, so as to be capable of identification from very wording used in the agreement.
Unfair contract terms prohibited in terms of the Consumer Protection Act 68 of 2008
In terms of the Consumer Protection Act (CPA), unfair contract terms are to be prohibited in deeds of sale to which the Act applies. Note that it is still ambiguous as to whether the CPA applies at all to residential property sales, as a seller in these “once off” private sales, may not be deemed to be a supplier selling goods in his/her ordinary course of business, as defined in the Act Where the CPA does apply, each case will be determined on its merits as to what is deemed to be fair or unfair contract terms.
Purchase price & payment
Where occupation takes place on a particular date and transfer takes place after the date of occupation, occupational interest is paid at an agreed amount for the period of occupation until transfer. In most cases this is paid by the purchaser, who may take occupation prior to transfer being registered. The terms should be stipulated in the deed of sale. In some cases, it is the seller who is the one who has to stay on in the property he or she has sold and where transfer has been registered. In this case, the seller will be required to pay occupational interest to the purchaser. In general, on occupation, risk passes to the purchaser. Clauses dealing with occupational interest and risk (who is at risk while the purchaser is in occupation) should be included in the deed of sale.
Electric fence regulations
Regulation 12 of the “Electrical Machinery Regulations” require that you have an “electric fence system certificate of compliance” if you install, add to, or alter an electric fence after 1 October 2012, or where there is a change of ownership of the premises on which the system exists, if the change of ownership takes place after 1 October 2012.
This affects the buying and selling of property. The Regulations do not specify that a certificate is required in order for property to be transferred However, a purchaser may find that he/she is required to obtain a certificate in order to comply with the Regulations. Sale agreements concluded after 1 October 2012 should make provision for the electrical fence system certificate, and set out clearly which party is liable for the provision of the certificate, and who shall bear the cost of doing so. This would in most cases be the seller, who would be required to provide the certificate prior to transfer taking place, (similar to the beetle, plumbing and electrical certificates required to be supplied by the seller). The certificate is transferable Once it has been issued, there is no need to obtain a new one upon a change of ownership.
The “Financial Intelligence Centre Act no 38 of 2001” (FICA) clause
Cash transactions and FICA:
Accountable institutions (AI’s), which include attorneys, are required to file a report with the Financial Intelligence Centre in regard to any cash transactions involving domestic and foreign notes and coins, and travellers cheques above R25 000.
The transferring attorney is required to request certain documents from both the seller and the purchaser, in compliance with FICA.
If applicable, the bank granting the bond may require the same documents as listed below. The documents required are as follows:
2. Company/Close Corporation
3. Natural Person
4. Estate agent
These lists are not exhaustive and are intended to give an idea of the required documentation for FICA compliance.