Defects and the Property Practitioner Part 3

02 Apr Defects and the Property Practitioner Part 3

In last week’s blog, we discussed S67 of the Property Practitioners Act 22 of 2019 which makes reference to the mandatory disclosure form that property practitioners are required to complete and have signed before accepting a mandate.

We will now start discussing the mandatory disclosure form itself.  Details regarding the mandatory disclosure form are to be found in Regulation 36 of the Regulations to the Property Practitioners Act.

Part 1 of Regulation 36.1 says as follows:

“…This report does not constitute a guarantee or warranty of any kind by the owner of the Property or by the property practitioners representing that owner in any transaction. This report should, therefore, not be regarded as a substitute for any inspections or warranties that prospective purchasers may wish to obtain prior to concluding an agreement of sale in respect of the Property.”

Part 1 of Regulation 36.1 clearly says that the mandatory disclosure form does constitute a guarantee or warranty of any kind by the owner of the property practitioner representing the owner.  Hence, you may then ask, if the owner or property practitioner is not providing a guarantee or warranty, then why even have such a form and make the disclosures required in the form?  Before we get to that, let us refer to Part 2 of Regulation 36.1, which provides the following definitions:

“…”to be aware” means to have actual notice or knowledge of a certain fact or state of affairs; and

“defect” means any condition, whether latent or patent, that would or could have a significant deleterious or adverse impact on, or affect, the value of the property, that would or could significantly impair or impact upon the health or safety of any future occupants of the property or that, if not repaired, removed or replaced, would or could significantly shorten or adversely affect the expected normal lifespan of the Property.”

We now have some very interesting points to note:

1. A property practitioner must have a mandatory disclosure form completed and signed before taking a mandate;
2. The mandatory disclosure form does not constitute a guarantee or warranty;
3. A defect is any condition that may impact the value of the property or impact upon the occupants of the property; and
4. The seller or property practitioner, needs to disclose those conditions (as listed in the mandatory disclosure form) that they are aware of.

Coming back to the question posed earlier, if the seller or property practitioner is not providing any guarantees or warranties relating to the condition of the property, then what is the need for the signed and completed mandatory disclosure form?  What do you think?

More on this question and the balance of Regulation 36.1 in the next few blogs.

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