Possible pitfalls in legal property documentation pointed out by Steward

Those signing a property-related legal document, e.g. a Deed of Sale, will find that they are required to initial every page and any alterations made on the page.

However, warns Lanice Steward, MD of Anne Porter Knight Frank, those doing this should be aware it is sometimes possible for the other party to the agreement to add in extra conditions or facts in the spaces that are still not completely filled in.

For example, a clause listing the fixtures and features in a home which are to be transferred with the property can very often be added to, to include items that were not originally discussed. Similarly, a clause stating that this or that will be done to the home prior to handover can sometimes be extended to take in later conditions. The way to prevent extras being added in this manner to a document, says Steward, is to draw a line across the page from the point where the sentence or paragraph ends and possibly across the following blank lines as well.

If the document involves a trust or closed corporation, it is essential to get from the trustees or principals of these a signed copy of the minutes or resolutions before the final agreement is drawn up. If the buyer or seller’s representative signs before these resolutions are available, the agreement can be deemed as not binding. The buyer or seller can then opt out on the excuse that those who had to sanction the agreement had, in fact, not given it their approval.

Where the property is owned under a community of property contract, the negotiator must realise that it will be null and void if one or other of the partners in the marriage does not sign it. Similarly, a buyer should do his homework prior to an offer going in and decide in which vehicle he will make it, i.e. either as a private individual, a trust or a closed corporation. Each of these vehicles has advantages and disadvantages attached to it, says Steward.

Article by: www.anneporter.co.za