SALE AGREEMENT COMMON TERMS
Addendum:
A supplementary agreement to an original sale contract covering points agreed to afterwards. It is a separate agreement in its own right and, if it contradicts the original in any way, it is presumed to overrule it.
Agreement of sale:
The basic contract of sale and purchase between a willing seller and buyer. No matter what the parties have agreed to verbally no contract exists until an agreement of sale is completed and signed by both parties.
Breach clause:
A condition in a contract obliging a seller to give a defaulting buyer written notice to remedy his breach of contract within a specific period (usually seven days) before he can cancel the sale.
Conditions of title:
These are the restrictive conditions limiting an owner's rights which are recorded on his title deed to a property. They cover matters such as mineral right reservations, servitudes and building limitations.
Cooling-off right:
A statutory right, recorded in Section 29A of the Alienation of Land Act, giving a buyer of a residential property costing R250 000 or less the right to withdraw from the sale within five days of making a written offer.
Electrical compliance certificate:
A certificate issued by a qualified electrician confirming that the installation on a property from its supply point is safe. Every buyer has to be in possession of one once he takes transfer of ownership.
Entomologist's certificate:
Known in common terms as a Borer Beetle Certificate. A certificate required by law in some coastal provinces to be obtained before transfer of a property confirming that its structure is free of wood borer or termite infestation.
Escape clause:
A condition in a sale contract giving the seller the right to cancel it if he obtains a better offer from another purchaser. It is usually inserted when the first buyer is given time to sell his own property first.
Fixtures and fittings:
These are attachments to a home which are deemed to permanently belong it, and may not be removed by the seller when he vacates the property.
Guarantees:
Written undertakings issued by registered banks guaranteeing payment of part or all of the purchase price on registration of transfer. They are furnished to the transferring attorney.
Interest-bearing accounts:
A savings account or other short-term investment opened by an attorney or estate agent to invest any deposit paid by a buyer. The interest accruing will accrue to the buyer on transfer.
Jurisdiction:
Most sale agreements contain a clause providing that, should either party take the other to court for any alleged default, he may do so in a Magistrates Court even though the amount in dispute may exceed its normal jurisdiction.
Null and void:
A legal expression emphasizing a final cancellation or lapse of a sale agreement. It puts both parties in the position they were in before the agreement was signed and leaves each without obligation to the other.
Prior occupation:
A buyer's right to take personal occupation of a property before transfer takes place. A rental, agreed to in advance between the parties, will be payable by the buyer until registration of transfer.
Offer to purchase:
A document setting out the proposed purchase price and conditions on which a buyer is prepared to purchase a property. It will be submitted to the seller and, once he signs it, it becomes a valid agreement of sale agreement.
Possession:
A stronger right than occupation which usually only passes on registration. It entitles the buyer to receive all rentals paid by existing tenants while obliging him to pay all assessment rates.
Property description:
This is the definition of the property sold in a sale agreement. It can simply be its street address but should record its erf number and township as described in the owner's title deed.
Subject-to sale:
An expression used by estate agents to describe a sale contract which will only become unconditional between the parties if and when the buyer sells his own property. A time period of sixty to ninety days is usually allowed.
Suspensive condition:
A provision in a contract suspending its operation until a specific condition is fulfilled. A clause stating
that the sale will only be confirmed if a mortgage loan is granted is a typical suspensive condition.
Explained further here
Voetstoots:
A Dutch expression meaning that a property is bought "as is" with all its patent and latent defects. A Seller can still be held liable for latent defects known to him which he fails to disclose to the buyer.
Explained further here
Back the Legal Advice Centre for
all your legal answers
Read more on Why to Use Property Network
CDPE Qualification - What does it mean
Read more on Why to Use Property Network
CDPE Qualification - What does it mean
BE A REAL FRIEND
SHARE THIS WITH SOMEONE
