There surely can’t be anything more frustrating to a seller than a buyer who deliberately delays the transfer of a property. There are, of course, a number of very good, legitimate reasons why a sale takes longer to go through than expected. However, there can be repercussions for the buyer if those delays are deliberately caused by him.
Buyers of homes in most cases would want the transfer to go through as soon as possible, but in some isolated incidents there are some people, who for various reasons use delaying tactics to delay the transfer process. But what they must realise is that they could be liable for the interest that should have accrued to the seller during that time, says Lanice Steward, managing director of Knight Frank Residential SA.
Buying a home is often a very emotional time for both the buyer and the seller. Some buyers get cold feet and find fault with everything, no matter how trivial, in an attempt to get out of the deal. That's why you will often find terms like “use their best endeavours” and “take all the necessary steps” in a sales agreement to facilitate the sale going through.
Buyers can’t wriggle out
Words to this effect then preclude a disingenuous buyer from wriggling out of a binding, signed sale agreement. Clearly, if the seller has fraudulently induced the buyer into the agreement, the buyer would be entitled to cancel the sale.
Nevertheless, even unjustified complaints by the buyer can and often will put a spanner in the works because it takes time to investigate and find out whether a complaint is spurious or not.
There are various ways that a buyer can attempt to delay a sale. A favourite tactic is to avoid contact and never be available to get on with the business of signing conveyancing and bank documents. It's not a case of refusing to do so, but rather a case of putting off the inevitable.
According to Steward, a recent case reported on in a Smith Tabata Buchanan Boyes property law update, (Mmakola v Nel), the buyers failed to pay the required guarantees over, using the excuse that the conveyancer’s details were not included in the agreement. Transfer was delayed by five months.
A case in point
According to their sale agreement the Mmakolas were liable for interest at the rate of 15% per annum and courts held in Nel’s favour, stating that the omission of the conveyancer’s details was a minor technicality and that this did not excuse them from not providing the guarantees in time, as they could have gotten these details from the seller (and in fact did have correspondence later from him with his details on the letter).
While some problems are relevant, they may be material. For instance, Stewart said that a case Knight Frank recently had to contend with involved a faulty gate, which was in full working order when the sale took place but had subsequently broken. "The sellers in this case had no working capital to repair it, so the situation is at a stalemate. This could result in the transfer being delayed if the buyer decides he wants it repaired before the transfer can go ahead.
“If the case law from the above-mentioned situation is applied, however, he could be liable for the interest due to the seller for the period the transfer was delayed,” she said.