Buying a house is a big deal—not just because of the money involved but also because of the complex legal challenges that comes with it. A recent court case in South Africa highlights exactly why having your own conveyancer can save you a lot of headaches.
The case that made everyone sit up and take notice
The story begins with Peter Green, who was trying to buy a house in Hout Bay for his daughter and her family. He agreed to purchase the property from Christopher Hughes, a UK accountant, for about R5 million. Green put down a R1 million deposit into a trust account with Pam Golding, the real estate company handling the sale.
However, the deal didn’t go smoothly. Green was supposed to secure a mortgage by April 2020 to pay the rest of the money, but he couldn’t get the loan in time. Then, the COVID-19 lockdown hit, shutting down offices and delaying the process even further. Eventually, in June 2020, Green got a mortgage, but by then, other complications had arisen, leading to the sale falling through.
What went wrong?
Here’s where things get interesting. According to the agreement, if Green didn’t secure the mortgage on time, he was entitled to get his deposit back. Hughes thought otherwise and believed he could keep the deposit as damages since Green’s daughter had started living in and even renovating the house (which turned out to be illegal without proper plans).
The case went to the Western Cape High Court, which sided with Green, ordering Pam Golding to return the deposit. Hughes wasn’t happy and appealed to the Supreme Court of Appeal, but the higher court also dismissed his claim, confirming that Green was entitled to his deposit back since he never officially waived his right to it.
This case shines a big spotlight on why it’s crucial to have your own conveyancer when you’re buying or selling property. A conveyancer is a type of lawyer who specialises in the legal aspects of buying and selling real estate. They make sure all the i’s are dotted and the t’s are crossed in your contracts.
If Green or Hughes had their own conveyancer, who wasn’t just going by what the estate agent set up, they might have avoided the whole dispute. Their conveyancer could have advised them to add an addendum to the agreement to extend the mortgage deadline because of the lockdown, which would have protected both their interests.
The takeaway
Whether you’re buying or selling, make sure you have a conveyancer who represents YOU. They’ll look out for your best interests and help navigate the tricky waters of property transactions. Don’t just go with whoever the real estate agent recommends—choose someone independent who will stand up for your rights.
By Gustav Meyer | Meyer Attorneys