Written for Property Poser
A reader has written to our Property Poser panel of experts about a recently acquired property that has turned out to be nearly one-third smaller than she thought she had bought.
While making plans to extend the patio and put in a pool in the front garden, the reader and a builder compared the area to the municipal plans. To their dismay, they found that the front fence is on municipal land and the front garden is not part of the property.
The sellers have applied to the municipality to buy this land to try to fix the situation. Apparently the owner before the sellers rented the land from the municipal council, but the sellers were unaware of this arrangement.
The reader wants to know what her rights and options are and whether she can cancel the sale and sue for costs incurred up to this point.
Liesel Greyvenstein from Greyvensteins Nortier says buyers who discover their improvement plans cannot be accommodated or that an external factor influences the characteristics of their property negatively, cannot necessarily claim damages from the seller.
“Standard sale agreements usually contain a stipulation that the buyer purchases the property as it is described in the title deed,” she says. “This includes the size as surveyed and indicated in the diagram or general plan and subject to the title conditions and servitudes contained in the title deed.
“Unless the seller deliberately misrepresented a characteristic, gave express guarantees regarding the title conditions or the existing structures were not erected according to approved building plans, the buyer won’t have recourse against the seller if he or she can’t carry out plans for improvements.”
The same applies if a characteristic of the property changes in the future, says Greyvenstein. “The buyer must check the size of the property, the title conditions and servitudes in the title deed before making an offer. A suspensive condition can also be inserted in the offer to give the buyer time to study the title deed.
“This will ensure that there are no conditions contained in the title deed that will catch the buyer off guard or hinder improvements. The buyer will also have the chance to query any discrepancies between the size of the property in the title deed and the size of the land that he or she was shown.”
Jaco Rademeyer of Jaco Rademeyer Estates says if sellers intentionally created the impression that the municipal land was part of the property for sale, while knowing it was not, it would be fraudulent misrepresentation under the law.
“Even if the sellers did not create the impression, but knowingly did not correct the reader’s misunderstanding of the property size, it would still be fraudulent misrepresentation, says Rademeyer. “The buyer would have grounds to cancel the sale and hold the seller liable for damages.
“In the reader’s example, it seems that the sellers were surprised by the situation. Even if they acted in good faith when selling the property, the fact remains that they sold land that did not belong to them.
“This constitutes negligent misrepresentation under the law and also gives the buyer grounds to declare the contract null and void and to claim damages.”
Rademeyer says another solution would be for the parties to agree to a reduction in the purchase price and continue with the transaction of the actual property owned by the seller.
“If the seller succeeds in buying the municipal land and transfers it to the buyer at no additional cost, the situation may also be resolved. The selling of municipal land can, however, be a tedious process as notice must be given to the public.”
Send your property related questions here.