All too often people try to argue slight technicalities in the law in hopes of trying to capitalise at the expense of another party.
However, this issue was dealt with on 5 December 2013 in the case of Mmakola v Nel in which the purchasers denied having liability for a delay in the transfer process as a result of submitting their guarantees late.
They said the reason for this was because the conveyancer’s details had not been included in the contract.
Although, they were aware of this fact prior to the deadline for submission and could have obtain the details from the seller without any difficulty.
Thus, they had no excuse for the 3 month delay it took for them to provide the necessary documents.
To understand the outcome of the case we have to briefly consider the facts therein. Mr and Mrs Mmakola (buyers) purchased a farm at a public auction from Nel (seller) for R3,5 million.
The conditions associated with the sale required the buyers to pay a deposit there and then. They would then have to secure the remaining balance of the purchase price by furnishing guarantees within a 30 day period after the seller had given them confirmation of the sale.
This was given on 30 April 2008 and thus the buyers had to provide the required guarantees by 30 May 2008 the latest.
If the buyers could not furnish guarantees in time and the result was a delay in the transfer, then they were liable to pay 15% interest annually against any amount that was outstanding from the purchase price after 30 May 2008.
Nel had his conveyancer attend to the transfer of the property however the conveyancer’s details were omitted from the agreement.
The first guarantee was delivered on 7 September 2008 and the final amount on the outstanding balance was delivered on 13 October 2008.
The buyers did not meet the terms of the agreements when they failed to provide the guarantees on time. Therefore the seller sought out legal action against the buyers so as to claim interest on the duration of the delay.
However, the buyers argued that because the conveyancer’s details weren’t included in the agreement they were not able to meet the terms of the guarantee provisions.
The seller however mentioned that both banks where the loans had been obtained from by the purchasers were advised of the need for guarantees to be provided.
The attorney of the buyers was also made aware of this fact and so even though the details were not included on the sale agreement, the parties involved all knew who the conveyancer was.
The court held that the buyers knew of their responsibility to obtain the conveyancer’s details and that they even noted the fact that these details were not included in the agreement before 20 May 2008.
The buyers were sent a letter a few days after they were supposed to furnish the guarantees. This letter contained the relevant conveyancers details.
Even so, the buyers could have easily had contacted the seller and asked for the conveyancer’s details.
The details not being included was rather a technicality and did not provide an excuse for the terms of the agreement not to be complied with.
Thus, because the buyers caused a delay in transfer, they were liable for the interest that Nel had claimed.
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