Sellers of Sectional Title Units should take note.

If you are the seller of a property in a sectional title, the last thing you want is for the buyer to find an easy way out of the contract. If the contract of sale relating to property in a sectional title is not drawn up correctly, you may, however, find yourself in a situation where the buyer has a legal right to cancel the contract.

The Sectional Titles Act governs sectional title schemes, and quite often, the developer of such a sectional title scheme, reserves for himself a right to add additional units to the scheme, the so called ‘right of extension.’ According to the Sectional Titles Act, if such a right of extension is reserved, this must be disclosed to any person who buys a unit in the scheme, and preferably, in the contract of sale.

If the right of extension is not disclosed in the contract of sale, it must be disclosed to the buyer in writing before the property is transferred into his name and this will have to be certified by the attorney tasked with the transfer of the property. If not disclosed, the contract of sale is voidable at the option of the purchaser.

Very often sellers and brokers are not aware of the impact of this legislation, and contracts are drawn up without providing for this notice to the purchaser. Often the conveyancer only becomes aware of the existence of such a right at quite a late stage in the transaction, and he then has to give the required notice to the purchaser in order to comply with the Sectional Titles Act. If the particular purchaser then suffers from buyer’s remorse, this may afford him the perfect excuse to cancel the contract without being in breach.

Sellers and agents should therefore obtain proper advice regarding deeds of sale when units in sectional title schemes are offered for sale.


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