A number of readers have requested guidance as to the process involved in transferring fixed property from one person to another.
Some questions involve a straightforward sale of a property between two parties, while others relate to properties being transferred as a result of a donation or inheritance.
Despite the general process being fairly well established and remaining largely unchanged for many years, there still appears to be some confusion as to how a property changes hands.
See the reader’s question here.
This column looks at the process as a whole and sets out a brief overview so that readers can have a better understanding of what it all entails.
The starting point is the Alienation of Land Act.
This states that no transfer of land, subject to the provisions of section 28, will be of any force or effect unless it is contained in a deed of alienation signed by the parties or their agents acting on their written authority.
It is clear that the starting point is to ensure that, regardless of the reason for the transfer of land, it must be recorded in writing.
Certain aspects must be included in the written document, such as the names of the person transferring the property and the person receiving the property.
It also must include a description of the property, any conditions applicable to the transfer which require fulfilment prior to transfer, the purchase price and how it is to be paid.
The most common basis for transfer of fixed property is that of sale, but other reasons include donation, inheritance and divorce settlement.
Each of these can be contained in a formal written document, stipulating the provisions applicable.
To effect transfer, a deed of transfer is required as prescribed in section 20 of the Deeds Registries Act and which states that the deeds of transfer shall be prepared in the forms prescribed by law.
These deeds shall be executed in the presence of the registrar by the owner of the land, or by a conveyancer authorised to act on behalf of the owner, and shall be attested by the registrar.
The form in section 20 is typically Form E, which is prepared by the appointed conveyancer and falls in line with the conditions of the Deeds Registries Act.
The form requires customisation as to the applicable circumstances related to the transfer.
It states that the appearer (person who appears before the registrar) declares that he cedes and transfers the property and all his rights to it to the buyer.
The document must include the name, number, registration division, administrative district and the area of the property.
The regulations governing the extending clause and reference to conditions must be observed.
The appearer renounces all rights he had to the property and acknowledges that is the situation. He also acknowledges the purchase price.
Additional documentation may be required depending on the basis of the transfer concerned.
Where a bond is to be registered over the property being transferred, a fairly substantial agreement covering its provisions will be required at the time of registration.
The conveyancer will also see to the administration and acquisition of various other aspects, which may include a rates clearance certificate, electrical wiring certificate and any other requirements agreed to between the parties.
The conveyancer charges a fee for seeing to the transfer process and also acts as an agent for Sars by receiving any transfer duty that may be applicable.
The process requires attention to detail as the transfer may be rejected if any material errors are discovered in the papers submitted for transfer.
This may result in a delay which may have financial implications for both parties.
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