Most sale agreements of immovable property contain a clause in terms of which the purchaser thereof agrees to buy the property voetstoots. The voetstoots clause is a provision in the agreement which stipulates that the purchaser buys the property from the seller as it stands and thereby indemnifying the seller against claims for damages in respect of any defects on the property, whether patent or latent. Patent defects are those defects that are visible whereas latent defects are hidden and not discoverable through reasonable inspection.
Although the voetstoots clause is designed to protect the seller, our South African case law and legislation provide for certain instances where the seller will not be able to raise the voetstoots clause as a defence in a claim for damages.
It has been ruled by our courts that 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 purchaser.
Due to the difficulty in proving the seller's intent and knowledge of latent defects at the time of contracting, a practice has developed whereby parties to a property transaction complete a disclosure form describing all the defects on the property. The seller will make a declaration confirming that the items listed in the said form constitute a full and proper disclosure. If so contracted, this disclosure form can be relied upon by the parties in the event of a dispute arising as a result of the existence of latent defects on the property.
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 investors.
It is important for the parties to a property transaction to familiarise themselves with the impact and exclusions to the voetstoots clause and to carefully read the sale agreement to avoid costly and unnecessary legal battles.
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Originally Published 22 April, 2020
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