“If you think education is expensive, try

ignorance”

MCademy

Legal issues pertaining

• Building plans• Sectional plans• Zoning & property rights

24 April 2013

Multidisciplinary nature of problem

Legal Town planning

Surveyor

Architect

CityCouncil

Agent

Multidisciplinary nature

Property law is complex

ArchitectsSurveyors

Work together Town plannersConveyancersAgents

Purpose of seminar

1. Hear from experts – other fields2. Answers on FAQ3. Give direction future

Sonja du Toit

Skills & ExpertiseConveyancing

Property Law

Commercial Contracts

Sectional Title Development

Township Establishment

Notarial Work

Education

University of Pretoria LLB (Cum Laude), 1999 - 2000

University of Pretoria BLC (Cum Laude), 1996 - 1998

Director at M.C. van der Berg Incorporated Attorney, Conveyancer & Notary

SECTIONAL TITLES

1. How did sectional titles originate?

2. Differences between sectional title and full title

3. Opening of a sectional title scheme

4. Terminology

5. Extension, subdivision and consolidation of a unit

1. How did sectional titles originate?

1. Definition of property ito common law:

- Ground- Structures attached thereto

2. Shortcoming of the definition

- no ownership of “flat”

3. Solution to the problem- Previously: share block schemes

- Sectional titles act

Owner of erf and structures attached thereto

No body corporate

Can improve the property with approved building plans

Rates & taxes and consumption of water & electricity payable to local municipality

Owner of the unit & undivided share in common property

Body corporate – all owners are members

Consent by body corporate, building plans and new sectional title plans for improvements

Rates & taxes and consumption payable to local municipality

Full title Sectional title

2. Differences between sectional title and full title

PROPERTY INFORMATION

Property Type ERFErf Number 776Portion Number 15Township CLUBVIEW EXT 39Local Authority CITY OF TSHWANE METROPOLITAN MUNICIPALITYRegistration Division JRProvince GAUTENGDiagram Deed T86055/1994Extent 639.0000SQMPrevious Description -LPI Code T0JR00370000077600015

PROPERTY INFORMATION Property Type SECTIONAL TITLE UNItUnit 1Scheme Name SS SNEAD MANORScheme Number/Year 134/2008Situated At CLUBVIEW EXT 90 , 1095 , 0Local Authority CITY OF TSHWANE METROPOLITAN MUNICIPALITYRegistration Division JRProvince GAUTENGDiagram Deed -Extent 151.0000SQMPrevious Description -LPI Code T0JR00370000109500000,D553/2007

Example:

93 ÷ 231 = 0,402597 x 100 = 40,2597 138 ÷ 231 = 0,597403 x 100 = 59,7403

If levies are R5 000 per month:

Unit 1 pays:

R5 000 x 40,2597% = R2 012,98

Unit 2 pays:

R5 000 x 59,7403% = R2 987,02

• Sectional title plans

- drafted by surveyor- approved by surveyor general

• Application drafted by conveyancer

• Annexure 8 and 9 to sectional titles act: Rules

• Lodge at deeds office

• Separate titles: Certificate of registered sectional title

3. Opening of a sectional title scheme

4. Terminology

1. Unit

2. Section

3. Common property

4. Exclusive use ( sect 27)

5. Right to extend

1. Unit: Section + undivided share in common property

2. Section = house

2. Common property: Areas surrounding unit

3. Exclusive use ( sect 27)

in terms of notarial in terms of rulesdeed of exclusive use

Real right cannot be bondedcan be bonded

4. Right to extend: addition of more units

- Developer- On opening of scheme- For a specified period- Horizontally or vertically

5. Extension, subdivision & consolidation of a unit

Extension of a unit (Usually problem with duets)

- In addition to building plans- Consent body corporate- Approved surveyor general plans- Application to extend – conveyancer- Letter by surveyor - 10% or less increase in participation quota- More than 10% - consent by all bondholders- Effect on exclusive use areas- Simultaneously with transfer- Also possible to subdivide and consolidate units

Lydia Lewis

Managing Member of

Velocity Townplanning &

Project Management

Skills & Expertise

Strategic Planning and Integrated PlanningTownship Establishment ApplicationsDevelopment Control applicationsDevelopment Investigations and AdviceUrban Renewal & Township DesignsDue Diligence studies / Property Audits

Education & Membership

University of PretoriaB(TRP) 1991-1994

Professional Planner: South African Council for Town and Regional Planners (TRP(SA))South African Planning Institute (SAPI)South African Association of Consulting Professional Planners (SAACPlan)

TOWN PLANNING IN GAUTENG101

Introduction to town planningWhy Town Planning?Spatial / Strategic PlanningTown Planning SchemesTypes of land use applicationsProfessions involved ProcessApplicationsLand Development Requirements (LDR)

Introduction to townplanning

Introduction

Lydia LewisB(T&RP) UP, TRP (SA)

Member of: - The South African Council for Planners (SACPLAN)- The South African Planning Institute (SAPI)- South African Association of Consulting Professional Planners (SAACPP)

A broad overview of town planning, terminology, processes, land use management and other useful information.

Why Town Planning?

Town and Regional Planning is the process of making decisions on the development and use of land. It is a tool for guiding and facilitating development and regeneration in a way that also preserves the best features of our environment.

Thus: What may happen where in the city, and how much of it.

Spatial / Strategic Planning

Strategic planning,(forward planning) - Regional Spatial Development Frameworks (RSDF)

- Local Development Frameworks (LDF) - Spatial Development Plans (SDP).

Planning authorities use these documents to control development and determine planning applications.

Very important developing tool.

- Uses- Densities, etc

Policies

Guest House, Creche, Commune, Second Dwelling, Home Office, etc.

Environmental

Spatial Development Plan / Framework

Town Planning Schemes

Land uses are managed by what are known as Town-planning schemes. Each municipality has its own, unique Town-planning scheme Tshwane is using The Tshwane Scheme of 2008.

Title DeedsIn addition to the zoning regulations, development is also controlled by conditions of title. These conditions are set out in the Title Deed of each property, and can restrict the way in which a property may be developed.

“The erf may not be subdivided, except in special circumstances, and with the written permission of the Administrator”.

“The erf may only be used for the purpose of a residential dwelling...”

Town Planning Schemes (Land use management)Residential 1Residential 2

Business 1Business 2Business 3Business 4

Types of land use applications

Township Application Any property with the zoning of “agriculture” are subject to a township establishment application in terms of that

area’s Town Planning Scheme

Professions involved A land use application is a comprehensive action that includes critical information from many professional disciplines.

- Environmental consultant - Land surveyor- Electrical Engineer- Civil Engineer- Traffic Engineer- Geotechnical Engineer- Conveyancer- Town Planner

ProcessAfter all the information of the abovementioned professions became available, the TP can commence to design the plan. The layout plan is the end result of all information available.

Rezoning Application

- A rezoning application is basically when you want to change the zoning (use) of your current erf to a different zoning, or if you want to increase the bulk (fsr) or density of your property. Done in terms of the Town Planning Ordinance, 1986.

In line with Spatial Framework?

Every individual erf has it’s own zoning (no blanket zoning).

Timeline

Costs

Process (public participation, council circulation, external circulation)

- Submission (including the Bondholder’s Consent).- Advertised in the Provincial Gazette and 2 other newspapers for two consecutive weeks - Site notice is displayed on site for 14 days. - Period for objections is 28 days.- Application is distributed to the different departments of the Municipality. - Comment period is 60 days from submission.- The City Planning Division makes a recommendation which is referred to the applicant for comments.- The application is approved and the amendment scheme is promulgated in the Provincial Gazette

Zoning Certificate

A rezoning application is subject to certain bulk services Contributions payable to local authority.

Bulk services contributions can be regarded as taxes • levied by the local authority • for the increase in the capacity of the existing

• storm water drainage • sewer system • water provision• electrical network • upgrading of roads

due to the rezoning application and is determined according to the area / ”bulk” of the new development.

From “Residental1” erf to “Business 4” erf = ± R100 000-00

Consent Use Application When?

rezone consent use application

Is not a permanent right.

A Consent Use application in terms of the relevant Town Planning Scheme.

Removal of Restrictive Conditions ApplicationThe importance of title conditions as development control measures has

diminished over the years due to implementation of more effective & flexible policy

documents & laws such as Town Planning Schemes and Municipal Ordinances.

- Building Lines- Uses- Building Materials, etc.

Subdivision ApplicationA subdivision application is done when you want to subdivide an existing erf into two or more parts.

Things you must consider when you want to subdivide:

- Density policy- Restrictive conditions in the title deed- Servitudes

Time & Costs

When you want to consolidate two or more portions with each other.

Consolidation Application

Things you must consider when you want to consolidate:

- Same rights- Same owner- In the same township

Notarial ties

Application

• advertised in the press or on the property itself• the approval thereof is left to the discretion of the Council

- Section 38 process

Other Applications

• Purchase of Council land

• Second dwelling

• Relaxation of building lines

• Advertisements along the Provincial / Gautrans Roads Etc.

Land Development Requirements (LDR)

What is LDR’s? The rules which you must oblige to in order to do a

development on a specific site. Specifically set out in every Town Planning Scheme

Includes the following:

• Landuse

• Coverage

• Density

• Floor Area Ratio or FAR (FSR)

• Height

• Parking Requirements

• Building Lines

Eamon Swart

Skills & Expertise

Township EstablishmentSectional Title PractitionerReplacement of Erf Beacons

EducationUniversity of PretoriaBLandm (Cum Laude), 1988 - 1992

Land Surveyor

S V R Land Surveyors246 Willem Botha

Wierda Park012 654 9769

IntroductionRole of Land Surveyor

What does a Land Surveyor do?

Requirements before submission to Surveyor General

Sectional Titles

Extension of Section

Role of Land Surveyor

• University degree

• Register at Institute of Professional Land Surveyors

• Working closely with:

o Town Planners

o Architects

o Transfer Attorneys

o City council

What does a Land Surveyor do?

• Cadastral

o New Townships

o Consolidations

o Sub Divisions

o Servitudes

o Sectional Titles

o Replacement of Erf Beacons

• Non Cadastral

o Detail Surveys

o Construction Surveys

Requirements before submission to Surveyor General

• Consolidation Approval from Town Council

60 Days after Submission

Example:

• Sub-divisions

Approval from Town Council

Pegging of Erf or Erven

Not the Remainder

Example of Parent Diagram

Example of Sub-division Diagram

Original Erf

Sectional Titles

Why Sectional Title?

• Necessary when you have more than one owner on a single property (erf or stand) examples

o Block of Flats

o Town House Complex

o Duets

o Game Farm Developments

• Pre-requirement for Sectional Title Submission to Surveyor General

o Second Dwelling Approval (City Council)

o Approved Building Plan (City Council)

o Buildings Completed to Roof Height

Extension of Section

• Any addition i.e.

o Stoep

o Balcony

o Car Port

o Loft

o Garage

o Additions to Existing Building

Example: Sheet 1

Example: Sheet 2

Example: Sheet 3

Example: Sheet 4

Please RememberHome owners either have approved building plans or no building plans but seldom sectional title plans for extension of section ! ! ! ! ! ! !

Once the property is put up for sale please check if building plans and sectional title plans are up to date.

Tertius Horak

Owner – KAROH ARCHITECTURAL DESIGN STUDIO

Senior Professional Architectural Technologist

SKILLS AND EXPERTISE

Residential property designCommercial property designIndustrial property designProject ManagementQuantity estimation

EDUCATION

Technical College SANat. Tech. Dipl. (Construction & QS)QBE

Introduction

South African Council for the Architectural Profession

1 Architect (degree)

2 Senior Professional Architectural Technologist

3 Professional Architectural Technologist

4 Professional Draughtsman

The role of professionals is multi-functional.

1 Advice on a wide scale related to the full scope of works

2 Advice related to SANS 10400

3 Advice related to Town planning scheme and by-laws

4 Practical design

5 Supervision and quality control

6 Ultimately to assist a client in achieving his goal within the requirements of the trade

The process of plan approval

Submission of any building plan with any authority vests only with persons registered with SACAP.

Time frame to approve plans

• Plans are generally approved by City councils

• City councils have 30 days

• Disputes with city council interpretation

• Plans can be obtained by or with consent of the registered

owner

• Responsibility of the home owner to always produce proof of

approved plans

• Loss of plans at city council

Timeframe for plan approval

1. Scope of project, appointment and design 1-4 weeks

2. Finalizing of plans & documents, signatures 1-4 weeks

3. Submission to Council 1-5 days

4. Approval by Council 4-8 weeks

Process of approval at Council

1 Submission of documentation and plans to Building office

2 Registration by building office

3 On site inspection by building inspector

4 Scrutinizing of plans by Plan examiner

5 Geology

6 Transport

7 Water & sanitation

8 Health

9 Electricity

10 Fire

11 Town Planning

12 Roads & storm water

13 Subdivision & consolidation

14 Property Services

15 Finance

Occupation certificates

Cost of plan approvalExample eg. 80m² addition not yet on plans

Professional fee R 8 000.00(3,5 -7,5% of contract value or rate per m²) Buildingline & height relaxations R 1 000.00Plan copies, documents and preparation R 500.00

Appointment of engineerSubmission to Council (80m² @ R11 per m²) R 880.00Other applications to Council (Relaxations @ fire)Administrative fee for runner R 1 500.00

Council submission fees 11.00/m² with a minimum fee of R 440.00 Additional fees

Problems occurring due to different requirements of the old and new regulations

Implementation of the new National Building Regulations (SANS 10400) 2010.

The role of a SDP for commercial properties

Site Development Plans (SDP)

Purpose of a SDP

Coverage, FAR and GFA

Coverage is expressed in percentage terms It is calculated as the area as a percentage of the total ground floor area divided by the total site area

FAR (floor area ratio) is expressed as a ratio of the total of all floor areas divided by the total site area

The reverse calculation to determine the maximum FAR is by multiplying the GFA (gross floor area) by the area of the property

The role of parking on commercial properties

The Townplanning Scheme.

Requirements regarding the NHBRC and Enrolment

The principle to create a fund

All new residential structures

Compulsory irrespective of finance

Guarantee for a five year period

Cost of enrolment

Enrolment not applicable

Frequent questions

Where and how are building plans obtained?

Who may apply for such plans?

What is the cost?

How long does it take?

What if plans are missing or non existing?

What is the cost to re measure and provide new plans for a structure and how long does this take?

1 New house2 Additions3 Pools, wendy’s, lapa’s etc

What plans or permission is required to build something which was already approved on a previous plan but not concluded at that point in time?

Availability and fees

Dougie Donald

Chief Building InspectorBuilding Control Office Region 4

EducationNHDP Building Management

Skills & Experience21 Years –City Council Building inspectorChief Building Officer –Tshwane Metro Region 4(Centurion)

Building inspections

Building Control office (Tshwane)Building Control officer (Tshwane)

Deputy Director Deputy Director

Regions

1 2 3 4 5 6 7 Akasia Sinoville Pretoria Centurion Cullinan Pta East Kungwini

Central & West

Office Manager

Office Manager

Chief plan examiner Architect Chief building Inspector (Dougie Donald)

6 Building inspectors 1 Law enforcement Officer

6 Zones in Centurion

Duty of Building Control Office Building industry + All buildings in Tshwane are built according to

National Building regulations Town planning scheme

RSA Tshwane

National Building regulations SANS 10400 of 2010

Act for whole RSA

e.g. Materials SABSStairs

VentilationCeiling heightsFire installationStormwaterFoundations

Safety Drainage Roofs Walls Floors Glazing

Town Planning scheme• Every town• Differ from town to town• Akasia

Pretoria Tshwane 2008 New Town planning scheme

Centurion

What does Town planning regulate?• Zoning• Building line• Floor space ratio (FSR)• Density• Height of buildings• Storeys

When do we inspect?1. If requested by owner

• Are building built according to National building regulations (NBR)?

2. Complaints & inspection• Enforce law if buildings out of National Building

regulations

NB: Duty on current owner to ensure building is according to- NBR- Town planning scheme

Occupational certificateWhen?

1. New buildings2. Addition to buildings3. Structural alterations to buildings4. Additions to property

Before 2000After 2000

Process to obtain occupational certificate1. Submit building plans2. Approve building plans3. Request all necessary inspections

3.1 Foundation3.2 Floor level3.3 Roof3.4 Open drain3.5 Final drain3.6 Final building

4. Certificates

FoundationStairs

• EngineersSlabRoof

• Glazing (glass)• Electric• Plumber

5. Occupational certificate

Owner uncertain• Building plans

Anyone inspect (seller / purchaser / agent) No copies Building office

Centurion c/o Basden & Rabie streets CenturionPretoria across Munitoria Isivono buildingAkasia 6649 Dale street, Karenpark

What must be on a plan?1. Buildings2. Swimming pools3. Lapa4. Wendy house5. Boundry walls6. Walls7. Louvre deck8. Carport

Transfer by conveyancer

• NBR every owner must have plan• Inspector enforce against current owner• Excuse ignorance! NO• No prohibition to transfer?• Banks?• Possible future legislation

Advice• Sellers:

1. Make sure if plans are in order2. If not, get plans in order3. Occupation certificate

• Purchasers to make sure plans are in order

Enforcement1. NBR

e.g.• Stairs• Ceiling

2. Town Planning scheme

• Density• Storeys

Notice to correct

Tiaan (M.C.) van der Berg

Director at M.C. van der Berg Incorporated Attorney, Conveyancer & Notary

Skills & ExpertiseConveyancingProperty LawNotarial WorkMediationContractsPractice Management

EducationUniversity of Pretoria/AFSAHigher Diploma in Alternative Dispute Resolution (Cum Laude), 2000

University of Johannesburg Higher Diploma in Labour Law, 1997

University of PretoriaLLM (Constitutional Law), 1994LLB, 1991 - 1992BLC, 1988 - 1990

Framework1. The problem

2. Can MC (your attorney) transfer property

3. Obligation to disclose - seller

4. Obligation to disclose – agent

5. Where does this leave purchaser?

6. Your dilemma

7. Our advice

1. The problem

2. Building plans generally not in order 3. Sectional plans not updated4. Insurance 5. Home Owners Association6. Banks may require 7. Purchaser may require8. Future legislation9. Estate agent wants to earn a living10. Not one solution11. Estate agents approach can differ

Framework1. The problem

2. Can MC transfer property

3. Obligation to disclose - seller

4. Obligation to disclose – agent

5. Where does this leave purchaser?

6. Your dilemma

7. Our advice

2. Can MC transfer property?Any prohibition to transfer property?

• Building plans• Sectional plans not in order• Zoning• Occupational certificate

In other words:

A. Statutory prohibition?

B. Contractual stipulation? C. Bond condition?

2. Can MC transfer property?

A. Statutory prohibition?

• currently none

• future legislation?

B. Contractual stipulation?

• Condition vs warrantee

• Condition - add clause to contract“the seller must provide the purchaser with approved

plans before transfer”-Obligation on MC-can only transfer • if plans are approved!

• If plans are not approved - only with consent from purchaser - then approve after registration

▪ retention? ▪ problem - can plans be approved? ▪ how long will purchaser wait?

2. Can MC transfer property?

B. Contractual stipulation?

• Condition vs warrantee

• Warrantee- Add clause to contract “seller warrantees that plans are in order”Obligation on Seller:

- Sidestep defect issue

Purchaser cancels ? If not Lower purchase price

Purchaser enforces warrantee

2. Can MC transfer property?

2. Can MC transfer property?

C. Bond condition?

• Contract subject to bond

Building plans Legal status of Sectional plans bond?

• Bank requires Zoning Occupational certificate Only conditional

Comply with requestSeller can

Suspensive condition not fulfilled Bond only conditionally approved Therefor no transaction

Framework1. The problem

2. Can MC transfer property?

3. Obligation to disclose - seller

4. Obligation to disclose – agent

5. Where does this leave purchaser?

6. Your dilemma

7. Our advice

3. Obligation to disclose – Seller?

• Zoning• Building plans not in order• Sectional plans• Occupational certificate

Must seller inform purchaser?

A. Statutory obligation to disclose?

B. Common law obligation to disclose?

A. Statutory obligation to disclose

• Consumer Protection Act

Transaction = CPA compliant YES seller must disclose

• DeveloperSeller • Bank

• Speculator If not disclosed

statutory warrantees or Purchaser can

Reduce purchase price Right to cancel

Transaction = Not CPA compliant NO obligation on seller to disclose NO statutory warrantees

• Typical transaction

B. Common Law obligation to disclose

In absence of legislation

Default – common law

- Non CPA transactions = subject to common law

Important to understand common law

B. Common Law obligation to disclose ….

Defects existed before 24 April 2013

Contract concluded

Common Law

Patent / Latent defects

Regulate position

Building plansSectional plansZoningOccupational certificate

Definition

A. Patent vs B. Latent

Obvious vs Hidden

A. Patent defect

Patent defect is visible or visible with reasonable inspection

Zoning Zoning certificateBuilding plans City councilSectional Title plans Deeds Office

Can argue legal defect = patentTherefore advise purchaser to inspect

A. Patent defect…

If legal defect = Patent

Common Law Caveat Emptor!(Purchaser beware)

THEN ZoningLegal obligation on purchaser to ensure Building plans are

in Sectional plans

order

No legal obligation on seller to disclose

B. Latent defect…

Latent defect is not visible or visible with reasonable inspection

B. Latent defect…

If legal defect = latent

Common Law Seller Purchaser

As general rule seller is liable for latent defects

Warranty

There is no latent defects!

BUTVoetstoots (as is) reverses position

Voetstoots clause excludes / cancels warranty

Most estate agent’s contracts

If Voetstoots no warranty against latent defects

If Voetstoots Latent defect = purchaser’s problem

Warranty

There is no latent defects!

UNLESSSeller 1 Knew of latent defect *Onus of proof 2 Fraudulently & on purchaser

• Deliberately conceals existence• To move seller to buy * Very difficult

to prove

If purchaser can prove 1 + 2 seller’s problem

Is legal defect e.g.non-compliance with Building Regulations?

Patent Latent

Van Nieuwerk vs McCrae (Witwatersrand High Court) (2007)

• No approval of Building plans

• High court “assumption there is an implied warrantyBuildings are erected in compliance with statutory requirement”

• Voetstoot clause in contract

• Court rules- Voetstoots clause only relates to physical defects- Physical nature i.e. geyser, roof, sewerage etc- Not legal issues i.e. plans, zoning

Therefore : Purchaser can assume plans are approved as on date of contract

Odendaal vs Ferraris (Supreme Court of Appeal) (2008)

Facts• Seller appoints estate agent

• Purchaser introduced to property by agent

• Purchaser inspects property

• No access to an outbuilding

• Agent assured purchaser property is in faultless condition

• Contract is entered into

• Purchaser occupies property before registration

• Purchaser notices sewerage manhole in outbuilding before registration

• Purchaser approaches Municipality

• Ascertains outbuildings not on plans

• Purchaser instructs bank not to register bond

• Seller sees this as repudiation, places purchaser on terms and cancels transaction

• Purchaser refuses to accept cancellation

• Seller approaches court to evict purchaser

• Seller argues:Legal (plans) defect is latentVoetstoots clause protects sellerProblem is purchaser’s

• Purchaser argues: 1. Voetstoots not applicableo Van Nieuwerk vs Mc Crae (W)o Implied warranty buildings are erected in compliance with statutory requirementso Voetstoots only deals with physical defectso Voetstoots does not deal with legal defects

Voetstoots clause of no effect

2. Seller had prior knowledgeFurthermore Seller knew of defectsHad to disclose

Supreme Court of AppealCourt rules Contravention of Building Regulations = Latent defect

Physical defectsVoetstoots clause protects seller latent and patent

Legal defects

Remember! Unless purchaser can prove that seller- Knew of defect - Fraudulently &- Deliberately conceals- To move purchaser to buy

SCA rules - Seller could not prove this

Framework1. The problem

2. Can MC transfer property?

3. Obligation to disclose - seller

4. Obligation to disclose – agent

5. Where does this leave purchaser?

6. Your dilemma

7. Our advice

4. Obligation to disclose – agent

Agent

CPA CPA

Seller Purchaser

PatentNo duty to ascertain any defects

Latent

But: If agents are aware must disclose (EAAB code of conduct)

Don’t give oral warrantiesAdvice: Purchaser must inspect properly

Framework1. The problem

2. Can MC transfer property?

3. Obligation to disclose - seller

4. Obligation to disclose – agent

5. Where does this leave purchaser?

6. Your dilemma

7. Our advice

4. Where does this leave purchaser? If patent defect Caveat Emptor

o Inspection at City council / deeds officeo Before making offer o Purchaser is not protected Purchaser must inspect

If latent defectNo voetstoots – common law warranteeVoetstoots

o Protects seller * patent + * latentUnless seller has prior knowledge of latento Purchaser must prove fraudo Seller is protectedo Purchaser is not protected

Contractual warranteeo “Plans are in order”o Purchaser is partially protected

Obligation on seller to provide

Contractual conditiono “can not register if plans are in order”o Purchaser is protected

Obligation on MC

Bond conditiono condition in bond instructiono “provide bank with approved plans”o Purchaser is protectedo Risk of cancellation

Cannot register

Framework1. The problem

2. Can MC transfer property?

3. Obligation to disclose - seller

4. Obligation to disclose – agent

5. Where does this leave purchaser?

6. Your dilemma

7. Our advice

•

6. Your dilemma 1. Most properties not 100% on plans2. Legally need to be 100% on plans

3. Not legal requirement to transfer4. Require plans from seller - ? Mandate5. Advise purchaser to inspect – no offer6. Ignore - initial bank requirement

- bank on instruction7. unethical conduct / civil claim

Property report

Property report1. Not a legal requirement2. Not a list of contractual warranties3. Not a list of patent defects4. Not a list of all latent defects5. Is a list of latent defects seller is aware of6. Purchaser acknowledges receipt

7. Make provision building plans sectional plans zoning

8. Protects agents

Framework1. The problem

2. Can MC transfer property?

3. Obligation to disclose - seller

4. Obligation to disclose – agent

5. Where does this leave purchaser?

6. Your dilemma

7. Our advice

7. Our adviceDifferent horses for different coursesYou must choose

1. Advise seller at listingo Establish if plans are in ordero If not – get it in order immediatelyo Consequences

2. Advise purchaser too inspect at city council / deeds officeo require warrantee all improvements comply with statutory and building regulations

3. Protect yourself as agento Don’t give oral warrantees to purchaser about planso Advise purchaser to inspecto Use property report

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