If a buyer accepts the transfer of a property and then discovers that it does not conform to the approved plans, he can find himself in serious trouble, so buyers should insist on seeing a copy of the approved plans before signing any sale documents. Alternatively the buyer should include a suspensive condition in the Offer to Purchase that puts the obligation on the seller to provide a copy of the municipal approved plans of the dwelling, within a reasonable period of time so that the buyer can compare the dwelling to the plans. This is according to Wayne Albutt, the Rawson Property Group’s Regional Sales Manager for the Western Cape, who says where a buyer accepts the transfer of a property and then discovers that it does not conform to the approved plans, he can find himself in serious trouble. He explains that the reason for this is, in terms of the Consumer Protection Act (CPA), if the seller is engaged in a one-off transaction (i.e. if the sale is not part of his usual day-to-day business) the Voetstoots Clause still applies, subject to any other relevant clauses agreed to in the Deed of Sale.
He says this means that the buyer is in effect buying the property as it is, regardless of whether it conforms to the plans or not.
The right course to follow is for the prospective buyer to insist on seeing a copy of the approved plans before signing any sale documents and then, with the help of an architect or building inspector, to check them against the existing dwelling. Albutt says should they not comply, the buyer has a few options: buy as is or make it a condition of the sale that new building plans be drafted and approved according to the dwelling, at the cost of the seller.
He says that all too often South African home owners change and add on to the existing dwelling without municipal approval and in doing so they often don't observe building regulations. In some cases, and more recently now with reputable estate agents complying more in terms of the CPA, some sellers have lost perceived asset value of their properties where built-on structures needed to be demolished prior to the effective sale of the property due to non-compliance of municipal building regulations.
However, what is the case if the owner knows that the building he is selling does not comply with the plans but does not disclose this? Is he then still protected by the Voetstoots Clause?
“If it can be proved in a court of law that the seller was aware of the irregularities, the purchaser will have a claim against the seller – but such prior knowledge can sometimes be difficult to prove,” says Albutt. So where does the estate agent stand in these cases? Albutt says this is where the situation becomes tricky because under the Consumer Protection Act, the agent is facilitating the sale of the property in the course of his normal day-to-day business and could be held accountable for not carrying out typical issues expected of the agent; this would include educating and informing the seller and purchaser of the potential liability of not ensuring municipal building compliance. Supposing the buyer buys the property, but finds out later that it does not comply with the approved plans, what steps can he now take?
“It is essential at this point to bring in an architect or draftsperson to draft the plans of the house as it is now and then to submit the “as built” plans to the municipality for approval," Albutt says. The new owner could be liable for a fine imposed by the municipality for owning a dwelling that does not comply with the approved building plans or may have to demolish parts of the dwelling that are not approved in order to ensure compliance.