What does the law say about the “voetstoots” clause, and latent and patent defects

Jun 25, 2021 | Home Buyers

 

 

.Charlene Goliath explains the Voetstoots clause

About Charlene…

Charlene (Goliath) Foster, the founder of Goliath Attorneys, completed her BA degree in Education and was a teacher for 15 years. As she holds social and community upliftment as core values, she identifies a gap in access to legal services among the broader community and set out to fill this gap.

She completed her BA Law degree through Unisa, as well as her Conveyancing and Notarial Practice qualification. Charlene then served as a director at a Johannesburg law firm for several years. She continued striving towards attaining her goal of public service on a more personal and accessible level by starting her own law firm in 2015, specializing in property and administration of deceased estates.

After reading this Q&A, you will know:

    1. What the “voetstoots” clause is in a sales agreement and how it protects both buyer and seller?
    2. What is latent and patent defects in a property are.
    3. The law around these defects and where the responsibility rests regarding these defects.
    4. Examples of both types of defects.
    5. Both the buyer and seller can ensure legal protection in terms of the “voetstoots” clause, by conducting a thorough inspection of the property and disclosing all known defects.

 

  • How to prevent a legal dispute between buyer and seller when it comes to latent or patent defects to a property.

 

 

 

“voetstoots” clause, and latent and patent defects.

Buyers and sellers often clash due to improper disclosure of property defects, which can cause conflicts. But legally, there are certain defects to a property that the seller doesn’t have to disclose. In other words, the onus is on the buyer to inspect the property thoroughly. There are other instances where the seller must legally disclose a defect but intentionally withholds the information because they might lose the potential sale. No matter who is responsible for disclosing or inspecting a property defect, it will eventually come to light, whether it was disclosed or not. There’s not much that can be done legally once the property is registered. You’ll need to register it before taking any action.

In order to have clarity on the defects to the property and who’s responsible, it’s important to first understand the “voetstoots” clause in a sales agreement. What does the “voetstoots” clause mean, and who does it protect? Most properties in South Africa are sold this way unless there are specific terms that stated otherwise.

It’s a tricky subject, and the only one for a legal expert to unpack, so I’ve called in the help of well-respected conveyancing attorney Charlene Goliath. Here’s what Charlene had to say about this matter.  

The Property Dude:

Hi Charlene, We’ve chatted about real estate law before, and I’m excited to continue the conversation on this platform together. I don’t know if it is because you were a teacher many moons ago, but you do have the ability to break down complicated legal matters into bite-sized, palatable chunks.

Before we get into defects and the different types of defects, let’s first look at the “voetstoots” clause. This is a clause that appears in almost all sales agreements in South Africa. What exactly does this clause mean?

Charlene:

It means that the property is sold in its current condition, without any guarantees or warranties. The buyer takes on all risks and responsibilities.

Simply put, when you buy the property, you accept it in its current condition and cannot hold the seller responsible for any defects found later. This clause indemnifies (protects) the seller against claims for damages in respect of any defects on the property, whether patent or latent.


The Property Dude:

This is where things become complicated and often lead to conflict between buyer and seller. Please shed a bit more light on the matter. When does the “voetstoots” clause protect the seller?

Charlene:

This clause protects the seller from damages they didn’t know about when they sold the item. A seller cannot rely on the “voetstoots” clause if the seller was aware of a latent defect and deliberately concealed or failed to disclose it with the intention to defraud the buyer.

The Property Dude:

We’ll get to the defects and how the law interprets the roles and responsibilities around the defects, but first, there seems to be a lot of controversies around the “voetstoots” clause. Are there instances where the “voetstoots” clause does not apply during the sale of a property?

Charlene:

In terms of the Consumer Protection Act, the “voetstoots” clause will not be applicable to a property transaction where the seller is selling the property in the ordinary course of business. This will typically be applicable to developers, builders, and (property) investors.

If the deed of sale doesn’t include a “voetstoots” clause, the seller must fix any hidden property defects for three years after the sale.

The Property Dude:

Great. If you buy a property directly from a developer, the “voetstoots” clause doesn’t protect them. Home buyers need to understand that buying directly from a developer offers protection under the Consumer Protection Act. It’s crucial to be aware of this when purchasing a property.

Let’s get back to the normal sale between a homeowner (seller) and a buyer, and let’s unpack the defects that we’ve touched on earlier. The law is very clear about latent and patent defects. Please explain what the difference is between the two types of defects.

Charlene:

Visible defects are patent, while hidden defects are latent and not detectable through reasonable inspection.

The Property Dude:

Please give examples of each of these defects.

Charlene:

A patent defect is clearly visible upon reasonable inspection, such as a crack in a wall or window. Flushing mechanisms of toilets, loose skirting, cracked floor tiles, and such also qualify as patent defects.

The Property Dude:

Latent defects are defects that you cannot see with the naked eye. Examples include leaks in the roof, faulty geysers, and a faulty pool pump. It now makes complete sense why there can be conflict when the seller doesn’t disclose these defects.

But let’s just stay on patent defects for a minute. Since the patent defect is “visible” (or obvious), is it still the seller’s duty to point it out to the purchaser? Do you assume the buyer will see it, or should we make sure to show it to them? And does this make the seller not accountable?

Charlene:

As the sale is “voetstoots”, the buyer should search for patent defects and include in the special conditions clause that these defects be fixed or replaced by the responsible party.

The Property Dude:

So, to clarify, the buyer is responsible for pointing out the patent defects and can’t hold the seller accountable afterward if the buyer didn’t do a proper inspection when viewing the property.

If the seller fixed a leak in the roof, which was a latent defect, before listing the property, should they still disclose the defect?

Charlene:

If you’ve fixed the leak and you genuinely believe it’s been repaired correctly, then the defect no longer exists. He is under no obligation to disclose this fact.

The Property Dude:

So, If the seller truly believes they fixed the roof leak, they are not required to disclose it as a defect.

Let’s move on. So, we now know that the seller has a legal obligation to disclose latent defects to the buyer. What if he fails to do so, and the buyer only discovers a defect after registration?

Charlene:

A defect, legally speaking, is a flaw that creates an unreasonable risk of harm in its normal use. In terms of the common law, a seller is liable to a buyer for all latent defects in the property sold for a period of 3 (three) years after the discovery of the defects.

If you see a “voetstoots” clause in a sales agreement, the seller won’t be responsible if you discover hidden defects on the property – unless you can prove the seller knew about them and didn’t say anything. The onus is on the buyer to prove that the seller knew, or reasonably ought to have known, about the defect.

The Property Dude:

Since it is not always easy for the buyer to prove that the seller knew about the defect – and considering that legal action can cost much more than repairing the defect – what legal advice do you have for the buyer, who has now taken legal ownership of the property?

Charlene:

The CPA (Consumer Protection Act) gives buyers the right to goods that are free from any defects and places the purchaser in a more favorable position. However,  the CPA only applies to sales made “in the ordinary course of business”.

When an owner sells their home, it’s a private sale and not a business transaction. The position is different when you buy from a developer, builder, or investor seller who sells property as a business. A legal cost for a successful claim against the seller for latent defects is unavoidable.

The best advice I can give to the home buyer is “prevention is better than cure”, and to do a thorough property inspection before concluding the OTP (Offer to Purchase).

The Property Dude:

I could not agree more. As a buyer, make sure you know what you’re buying before you sign the OTP because after you’ve signed, you’ve entered into a binding agreement which is hard to get out of.

Now, what advice do you have for buyers when the property isn’t the seller’s primary residence (for instance an investment property), or it’s a deceased estate, which means the seller is unavailable to point out latent defects?

Charlene:


When buying a property, it’s worth paying for an expert house inspection. It can save you money and give you peace of mind. You can make your offer subject to a successful property inspection. Both the buyer and seller must agree to the terms outlined in this clause, which specifies their obligations to each other.


The Property Dude:

I agree that R2 000 or R3 000 for a professional home inspection gives the buyer so much more peace of mind, and it really is a small price to pay. As the buyer, you don’t have to turn the property down if you discover a latent defect. You can first ask the seller to fix the defect before the sale of the property can go ahead, or you can use the report from the professional home inspector to negotiate a better price on the property.

What I also find very interesting is that once there is a professional home inspection report on latent defects to a property, the seller can no longer hide the fact that he “didn’t know” about the defect. He is now by law required to disclose the defect to any further interested buyers.

Charlene, what role can the attorney play during the negotiation process between buyer and seller, to ensure a smooth sale without conflict over latent and/or patent defects?

Charlene:

The attorney should ensure that sellers and buyers have a sound understanding of the “voetstoots” clause and the obligations and rights of the parties.

The Property Dude:

Do you have any final advice for buyers and sellers regarding latent and patent defects that they should consider before finalizing a sales agreement?

Charlene:

You should inspect the property you intend to buy or sell thoroughly. In addition, buyers must ensure that the local authority (municipality) has approved any outbuildings, additions and alterations to the property. According to the law, not having approved building or alteration plans can be considered a “defect.”

The Property Dude:

Charlene, thank you for these great insights. Great news! It seems like we all understand better now who is accountable for latent and patent defects.

Anyone who wishes to make use of Charlene’s professional legal expertise can do so by contacting her directly at charlene@goliathattorneys.co.za.

 

Contact The Property Dude for more info.

 

(Updated 06.03.2023)

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