'Many loopholes can be found in Agreements of Sale'
Any experienced property professional can help a seller or buyer get out of 80% of Agreements of Sale says Wayne Albutt, Regional Sales Manager for the Rawson Property Group in the Western Cape.
'Most traditional Agreements of Sale will have had sections added to them or deleted from them so as to fully cover the agreement and in most cases it is these additional clauses that can be exploited and give rise to problems, making the Agreement of Sale unenforceable in terms of the Alienation of Land Act. Should one of the parties want to get out of the agreement after signing, an astute lawyer or estate agent can often find reasons for making the Agreement of Sale voidable.'
'As indicated,' says Albutt, 'most of the reasons given for wanting to get out of sales agreements are trumped up. They are often due to buyers' or sellers' remorse and not to any real fault in the documents.'
Sadly, says Albutt, the estate agent will nevertheless usually be held responsible for the cancellation of agreement and his reputation will suffer.
Giving examples of cancelled contracts, Albutt mentioned a case in which an Agreement of Sale was concluded, but the owner then discovered from other agents that there were more potential buyers who were prepared to pay above the initial asking price. The seller then managed to have the initial agreement deemed void on the grounds that the agent had made several legal errors. The agent, needless to say, was highly embarrassed and the initial purchaser was far from happy on being told that he no longer had a valid Agreement of Sale.
In another case, says Albutt, the deal was cancelled because the offer had in fact expired a day or two earlier than the date on which the seller accepted it - a situation which under normal conditions can easily be rectified.
Another case saw a deal rendered null and void because the consenting spouse, who had been married in community of property, had not got the obligatory two witnesses to attest to the agreement. Where a legal entity is involved, said Albutt, it is sometimes possible to prove that the signatory was not duly authorised and this, too, has resulted in sales falling through.
'There are many ways of escaping from an Agreement of Sale that appears to be legally binding and watertight,' says Albutt. 'Fortunately most people do not want to do this, but the simple truth, which has to be recognised, is that estate agents and certain parties to sales have suffered severely as a result of this on-going practice.'
Rawson Press Release