Mandatory Disclosure Form Not Being Attached to Sale Agreement | Legal Articles

 

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Mandatory Disclosure Form Not Being Attached to Sale Agreement

Property professionals know that discovery and disclosure of defects in a property marketed for sale is a non-negotiable part of concluding the sale.

It has always been the responsibility of property professionals to obtain as much information as they can regarding the property’s condition so that they can disclose this information to the buyer. Transparency is key when it comes to buying and selling property.

Buyers of property are known to expect that the property they are purchasing has little to no defects, making it challenging for property professionals to encourage prospective buyers to still make an offer.

But what are the implications of not disclosing this information?

We discuss this matter below.

mandatory disclosure form south africa

Consumer Protection Act South Africa

Section 40 of the Consumer Protection Act 2008 prohibits property practitioners from marketing a property if a full discovery of defects has not been undertaken. The lack of such discovery can be treated as fraudulent activity on behalf of the property practitioner.

Buyers are consumers who make their decision to purchase based on the information provided to them by the property practitioner.

Mandatory Disclosure Under the Property Practitioners Act

The Property Practitioners Act (PPA) was signed into law in October 2019, and it expressly obliges property practitioners to fulfill the following duties:

  • Obtain a fully completed disclosure form as prescribed in the PPA before accepting a mandate to rent or sell
  • Provide a copy of the disclosure form to all prospective tenants or buyers
  • Attach a copy of the disclosure form to the sales agreement

It will automatically be accepted that no defects were disclosed to the tenant or prospective buyer if the disclosure form has not been completed prior to the mandate or if a copy of the form was not provided.

Should this be the case, the landlord or seller of a property will have no legal defense against claims for property defects.

Additionally, if the property practitioner fails to adhere to the relevant requirements related to disclosing property defects, they will be held personally liable for damages or loss on the part of the buyer, tenant, seller, or landlord.

If the property practitioner simply forgets to show prospective tenants or buyers the disclosure form, it will be assumed that the property is sold or occupied with no existing defects.

The guidelines stipulated in the Property Practitioners Act exist to protect property practitioners as well as buyers, tenants, sellers, and landlords. These guidelines should be followed at all times to avoid legal proceedings which may follow due to negligence on behalf of the property practitioner.

Van Deventer & Van Deventer Incorporated – Property Attorneys South Africa

At Van Deventer & Van Deventer Incorporated, we specialize in property law in South Africa and can assist with legal matters related to same.

Contact us for more information.

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