Month: November 2024

“One of the hallmarks of an enlightened egalitarian society is the right to freedom of religion.” (Extract from judgment below)

Our courts do not tolerate unfair discrimination in the workplace, and employers need to tread particularly carefully when it comes to the concept of “automatically unfair discrimination”. Get that one wrong and you could be penalised with an order to pay your employee two years of earnings as compensation.

What is “automatically unfair discrimination”?

A dismissal is automatically unfair if based on any “arbitrary ground”, including, but not limited to, a person’s race, gender, sex, pregnancy, marital status, family responsibility, ethnic or social origin, colour, sexual orientation, age, disability, religion, HIV status, conscience, belief, political opinion, culture, language or birth (aspects relevant to this case have been highlighted).

However, “a dismissal may be fair if the reason for dismissal is based on an inherent requirement of the particular job” (emphasis added).

Let’s discuss these concepts with reference to a recent Labour Appeal Court (LAC) case.

“Sorry, I can’t work on the Sabbath”

Employed as a regional marketing manager by an international hospitality company, an employee signed a standard employment contract which, after specifying “normal hours of work” as being 8.30 a.m. to 5 p.m., Mondays to Fridays, with an hour for lunch, also provided for circumstances in which he could be required to work outside those hours.

Two months after starting work, the employee dropped what presumably came as something of a bombshell to his bosses. He said that as a Seventh Day Adventist, his religious beliefs precluded him from travelling or attending events on the Sabbath (i.e. from sunset on Friday until sunset on Saturday). He hadn’t made any mention of this in his job interviews, nor had he challenged the wording of his contract as to the required work hours.

Initially his line manager was able to accommodate him by covering for him on the problem days (travelling, it seems, to Kenya, Mozambique and Zambia as well as locally), but after 16 months she could not continue. He was offered an alternative position which didn’t require him to work on the Sabbath, but that came with a 45% pay cut.

The manager declined this offer, and he was dismissed after a disability enquiry. He challenged his dismissal, and the Labour Court, after finding it to have been automatically unfair, ordered his reinstatement.

His employer appealed this judgment to the LAC, which overturned that ruling and held that the dismissal was in fact fair.

Lessons to learn, points to ponder

The reasoning and the legal principles that underpinned the employer’s success in this case provide a useful blueprint for both employers and employees who might find themselves in a similar situation. Let’s address them point by point:

• Job interviews: It no doubt counted against the employee that he hadn’t mentioned the limitations on his working hours in his interviews, nor had he queried the wording of his employment contract. As a job applicant, be clear about any constraints on your work availability outside of normal hours, and query anything in your contract that might conflict with them. As an employer, make it an integral part of your interview process to check that the applicant understands your requirements as to both normal and additional work hours, and agrees to them.
  
• Employment contracts: The employer’s success in the LAC would not have been quite as easily won if its contract hadn’t clearly stated that the manager “will be required to work longer hours from time to time without additional compensation” (emphasis added). A “job flexibility requirement clause” also helped it when it came to the offer of an alternative position.
  
• Automatically unfair discrimination: There are two questions here. Was there discrimination? And if so, was it based on an arbitrary ground such as the employee’s religious beliefs? The employer in this case conceded on both aspects.
  
• “An inherent requirement of the job”: It was then for the employer to convince the court that the discrimination was permissible because the job requirement in question is “inherent or inescapable in the performance of the job”. Such a requirement has to be “rationally connected to the performance of the job”, “adopted in a genuine and good faith belief that it was necessary to the fulfilment of a legitimate work-related purpose” and “reasonably necessary to the accomplishment of that purpose.” The employer had no problem in proving all that. But that wasn’t the end of it…
  
• Accommodating the employee: As an employer, you can’t simply say “tough luck, your religious beliefs mean you can’t do the job as per its inherent requirements so off you go.” You must prove “that it is impossible [for you] to accommodate the individual employee without imposing undue hardship or insurmountable operational difficulty.” It was on this leg that the employer nearly came unstuck – while two of the judges agreed that it had passed this test, the third judge disagreed. If the decision had gone against it, the employer would have been penalised with a compensatory order of 24 months’ earnings.

Bottom line here is that you must act reasonably and in context in trying to enable an employee to continue in employment.

Our employment laws are complex and the penalties for getting them wrong are severe – so don’t hesitate to ask us for help if you’re in any doubt.

“When the hurly-burly’s done, when the battle’s lost and won.” (One of the witches in Shakespeare’s Macbeth)

Another year draws to a close! If you’re taking a break, now’s a great time to get started on an estate plan – or to update your existing one.

Estate planning is one of the most important steps you can take to protect your assets and to ensure that your loved ones are cared for after you’re gone. It goes beyond just having a will, although that is of course an essential first step when it comes to executing your plan. An estate plan ensures that all your wishes are documented, clear, and legally binding.

Why must you prioritise an estate plan?

Having a well-thought-out estate plan is essential for several reasons:

• Protecting your loved ones: An estate plan ensures that your loved ones are provided for in the way that you choose.
  
• Structuring your estate: Your planning will help you decide upfront how best to structure your estate, your asset-holding entities, and so on.
  
• Reducing costs and delays: A proper plan can minimise the expenses and time needed to administer your estate.
  
• Tax efficiency: Thoughtful planning could help reduce taxes on your estate, preserving more of your wealth for your heirs.
  
• Avoiding disputes: By clearly stating your wishes, you can help prevent costly and bitter family disputes over your estate. Our law reports are full of them!

What you’ll want to include in your estate plan

Everyone’s situation will be unique, but a comprehensive estate plan typically encompasses:

• Your will (“Last Will and Testament”): This is your essential first step, setting out who your executor will be, who will inherit what, appointment of guardians and trustees and so on. It’s the central hub around which the rest of your plan revolves.
• Trusts: Trusts are tools for controlling how and when your assets are distributed to your heirs. They are especially useful for minor children or anyone who needs special care. They can also be used in planning for tax efficiency, but this is a specialised subject requiring advice tailored to your situation.
• Power of Attorney: This authorises someone you trust to make financial or legal decisions on your behalf if you need them to. Bear in mind that it will fall away when you die, or if you lose mental capacity.
• Living Will/Healthcare Directive: This outlines your preferences for medical treatment if you cannot communicate, helping to guide loved ones and healthcare providers.
• Beneficiary nominations: Certain assets, like living annuities and life policy proceeds, will be paid out directly to the beneficiaries you nominate. It’s also a good idea to nominate beneficiaries for all your pension products – fund trustees will not be bound by your nominations but they will at least be made aware of your wishes.

9 steps to creating your estate plan

With that list in mind, it’s time to get started! Here’s how…

1. Define your goals: Determine what you want your estate plan to accomplish, such as providing for specific loved ones, the welfare of your pets, charitable donations, the preservation of family heirlooms and so on.
   
2. Family dynamics: Be mindful of potential issues that could arise, such as blended families, estranged relatives, minor children, and any other loved ones with special needs or circumstances.
   
3. Take stock of your assets and liabilities: List all your assets, debts, financial obligations and the like. Remember that if you are married, your chosen “marital regime” (matrimonial property system) will determine which of your marriage’s assets are yours to bequeath.
   
4. Consider cash: Deceased estates can take a long time to finalise, so make a plan for your family to have access to funds in the interim – life policies, family trusts, and separate bank accounts are common recommendations.
   
5. Tax implications: Our tax laws can seriously impact your estate, so it’s crucial to understand how to minimise taxes. If you have assets in multiple jurisdictions, it gets even more complicated.
   
6. Choose your representatives: Appoint trusted individuals as executors, trustees, guardians, and agents for powers of attorney.
   
7. Draft your plan with professionals: Work with us to draft and review all the necessary documents, ensuring they correctly and clearly reflect your wishes, and that they comply with all our laws.
   
8. Leave an information and documents file: It will help your executor and heirs a lot if you leave them a comprehensive file of all the important information and documents they will need.
   
9. Review everything regularly: Life changes, so diarise regular reviews and updates of your estate plan to reflect any significant changes. These could include marriage, divorce, the birth of a child, the death of a beneficiary, changes in assets and liabilities, changes in business operations, any new laws and taxes. The list goes on…

If you need any help getting started, feel free to reach out – we’re here to help you every step of the way.

“The bluntest pencil is better than the sharpest mind” (Unknown)

The Festive Season is traditionally a time for giving, and it seems a pity to have to mention the hard realities of the law right now. But, as a recent High Court dispute confirms, things can go horribly wrong if the people involved have different notions on whether what’s being given is a gift, or a loan.

“Here’s R400k Ma” – But was it a loan, or a gift?

The setting for this dispute is a small caravan park, with 13 caravan sites, nine flatlets and two chalets, in the resort town of Illovo Beach on KZN’s beautiful South Coast.

The two parties are:

1. A prospective mother-in-law, part owner of the park, who lives in one of the flatlets.
   
2. Her daughter’s fiancé. He and the daughter were living together in the daughter’s separate flatlet at the time.

The fiancé was badly injured in a motorcycle accident, which saw him hospitalized for two weeks and incapacitated for another several months. He was paid R1.8m by the Road Accident Fund.

He used part of his R1.8m to pay his future mother-in-law (he called her “Ma”) three amounts totalling R400,100. And that’s where the dispute arose, with the Ma and son-in-law disagreeing on the nature of the payments:

• The fiancé claimed that it was a verbally-agreed loan for a long-term investment, repayable on demand.
  
• His prospective mother-in-law claimed that it was a verbally-agreed donation.

She duly refused to repay the money to the fiancé when he demanded it, and he sued her in the regional magistrate’s court. The onus, it was decided, was on her to prove her version that it was a gift rather than a loan.

She lost the case, largely it seems because she gave contradictory explanations for why the fiancé had given her such a gift. At first, she said it was as a token of appreciation for her not charging him to live in her daughter’s flatlet, for settling some of his medical expenses, and for the care she’d taken of him during his recuperation. But later, she said it was for payment of her legal fees arising out of a dispute with her ex-husband, and a gift, not to her, but to her daughter.

The magistrate accordingly held that she had received not a gift but a loan and ordered her to repay it. Her attempt to appeal to the High Court failed on the basis that she had filed her appeal late without giving good reasons for the delay. Critically, the Court described her prospects for success as “poor” given the above facts.

While this particular case has been decided, the main point is that the whole sorry saga of dispute and litigation could have been very easily avoided…

Gift or loan? Avoid all doubt

There’s nothing like a misunderstanding over money to drive a wedge between friends and/or family. That’s why you should avoid all possibility of confusion and dispute with a written, signed agreement. Clearly state how much is involved, and whether it’s a gift or a loan – and if it’s a loan, specify the arrangements for repayment.

Of course, the more money involved, the more detailed and formal your agreement needs to be. It goes without saying that we are here to assist if you need any advice or help.

“A man’s home is his castle.” (Sir Edward Coke, English common law ruling, 1604)

Of course, what we all want to hear at the end of our house-selling journey is something like this: “Congratulations! You sold for a good price, the buyer’s taken transfer and you’ve been paid the purchase price. Time to pop the bubbly🍾”.

Having your sale go this smoothly is about a lot more than just finding the right buyer at the right price. It’s also about navigating a complex legal process to ensure a smooth and timely transfer of ownership.

A critical part of this journey is choosing a conveyancer (“transferring attorney”) to handle the transfer for you. Many sellers don’t realise that this choice is theirs to make – but it is. So don’t listen to anyone who tells you otherwise!

Why do you need a conveyancer in the first place?

Conveyancers are the specially qualified attorneys who oversee all the administrative, legal and financial steps required to transfer property ownership from sellers to buyers in the Deeds Office. They ensure that everything is done correctly, that the terms of the sale agreement are complied with, and – most importantly from your point of view as seller – that you get paid.

Why does the seller get to choose?

While there’s nothing in law to stop you from agreeing otherwise, there are good reasons why you should never give up your right to choose your own attorney:

• You carry more risk, so you call the tune! As the seller, it’s your valuable asset at stake, and it’s you who is legally responsible for transferring ownership correctly and on time. So, even though it is invariably the buyer who has to pay the conveyancer’s fees and other transfer costs, it’s usually accepted that it’s you as seller who appoints the conveyancer. The idea that “he who pays the piper calls the tune” doesn’t apply here!
• You need to protect your investment: A buyer-appointed conveyancer (although obliged to act professionally towards both parties) may not be as focused on protecting your financial interests as your own attorneys will be – and that’s a risk worth avoiding.
• You should control the process: Having your own conveyancer means you have someone ensuring the sale progresses smoothly and with minimal delay. If, for example, a buyer starts hedging for more time to pay a deposit or to obtain a bond, you need someone in your corner to act quickly and firmly to protect your interests.

How should you choose and appoint the conveyancer?

When choosing a conveyancer, here are some factors to consider:

• Experience and proactivity: Experienced conveyancers can spot potential delays or issues early and take steps to resolve them. They know how to handle red tape and to meet necessary requirements promptly.
• Clear communication: You want to receive regular updates so that you always know the current status of your sale. Consistent communication can save time, reduce confusion, and give you peace of mind throughout the process.
• Attention to detail: Property transfers are legal transactions with many requirements, and even a small mistake can cause delays, disputes or losses. You want someone who will be meticulous with documentation and red-tape, ensuring compliance and accuracy.
• Strong protections against cybercrime: Email scams and cyberattacks targeting financial transactions are on the rise. Property transactions are at particular risk, so make sure your attorneys have secure systems in place to protect your information and your funds.

The formal appointment is made in the sale agreement (often initially titled “Offer to Purchase”). Pay particular attention to the clause specifying which firm of attorneys is to be appointed. As we suggest below, sign nothing until we’ve checked the document for you, together with all the other terms and conditions.

When should you bring us into the picture?

It’s never too early! Ideally call us when you first decide to sell so that we can guide you through everything from the initial steps of finding a buyer, right through to signing the sale agreement and then navigating the transfer process.

It’s particularly important that you have us review any offer to purchase you are given before you sign it. We’ll ensure that it’s legally sound and fair to you, and we’ll help you understand any unique terms or special conditions included in the sale agreement.

“Sexual violence is a horrific reality that continues to plague this country.” (Quoted in judgment below)

It’s often said that victims of rape and other types of sexual violence have to suffer twice – firstly at the hands of the rapist and secondly at the hands of the law.

A recent High Court ruling on the knotty question of consent could go some way towards remedying this. At the heart of the matter is the delicate balance between a victim’s right to be treated with dignity and compassion in their quest for justice, and the accused’s right to be presumed innocent until proven guilty in a fair trial.

The consent conundrum

To secure a conviction of sexual violence the State must prove – beyond reasonable doubt – the absence of consent to the accused person’s actions. Unfortunately, major injustices have resulted in the past from the fact that many perpetrators escaped conviction by simply claiming that they believed that consent had in fact been given – without having to show that their belief was in any way reasonable.

Two shocking acquittals

The Court referred to two practical examples of grave injustice rooted in the current wording of the Criminal Laws (Sexual Offences and Related Matters) Amendment Act:

1. A woman had agreed to oral sex only, but her then-boyfriend proceeded to perform full penetrative sex. He claimed that her body language gave tacit consent to penetration and that he misconstrued her request to him to stop as a request to pause momentarily. He was acquitted on the basis that his version was “reasonable and possibly true, although his explanation was improbable”. The complainant had not objectively consented, but the State had not proved beyond reasonable doubt that his version that he genuinely believed that there was at least tacit consent, was false. The court considered itself bound to acquit “unless it is satisfied not only that the explanation is improbable but that beyond any reasonable doubt it is false.”
   
2. In the second case, a woman was raped by a man she met through an online dating site. He had invited her to his home for a “party” at which she turned out to be the only guest. The perpetrator was acquitted on the basis that, although the victim had not objectively consented to the penetration, “she neither physically resisted nor loudly protested. The State did not exclude the possibility that the accused did not hear her say ‘no’ and did not prove beyond reasonable doubt that he was aware that she was not consenting. Put differently, the court accepted that he had subjectively believed that there was consent.”

Enter a welcome new limit to the consent defence

The courts in question had no choice but to acquit given the Act’s present wording, and as the High Court put it: “Currently … an unreasonable belief in the presence of consent is a defence. The State bears the extraordinarily high burden to prove that the accused’s claim that he [it could of course have been a “she”] was under the impression that consent had been given is not reasonably possibly true.”

It accordingly held the relevant sections of the Act to be unconstitutional and invalid and ordered that they be read such that “…it is not a valid defence for that accused person to rely on a subjective belief that the complainant was consenting to the conduct in question, unless the accused took objectively reasonable steps to ascertain that the complainant consented to [the] sexual conduct in question.” (Emphasis supplied).

How will our courts interpret this in practice?

Based on the Act’s current wording, our courts have previously held that, “where there was no express rejection of the sexual act … consent has the following requirements: (a) the consent itself must be recognised by law; (b) it must be real consent; and (c) it must be given by a person capable of consent.”

Assuming the Constitutional Court upholds the High Court’s declaration of invalidity, we can only guess how our criminal courts will ultimately interpret whatever new wording it and parliament (which has 18 months to amend the Act) finally settle on. But something like the five-point common sense definition of consent given in Amnesty International’s article “Let’s Talk About Consent” may well form the basis of judicial interpretation down the line.

The article further suggests that “Consent is not about signing a contract! It’s about communication and about making sure all sexual activities happen with mutual consent.” Which seems like a fair and practical way of looking at it.

The bottom line?

One would hope that our courts will ultimately decide that only a genuine, unequivocal, unpressured, informed, specific and un-retracted “Yes” will be enough to escape conviction.

As a final thought, remember that this new law only comes into force if and when the Constitutional Court confirms it.

“The best investment you will ever make are your employees” (Peter Drucker)

As the end of the year approaches, many employees are eagerly awaiting their 13th cheque or year-end bonus. However, not every employer is in a position to pay bonuses, and this can lead to disappointment, disputes, or even legal action if expectations aren’t managed properly.

Read on to find out whether you’re legally required to pay a bonus, and how you can avoid potential conflict.

What does the law say?

There’s a common misconception that South African law obliges employers to pay annual bonuses. This is not true. There’s no automatic legal requirement to pay a 13th cheque or other bonus unless certain conditions apply:

• Employment contracts: If the employee’s contract states that an annual bonus or 13th cheque is part of their remuneration or guaranteed rather than discretionary, you are legally obliged to pay it.
• Company policies or agreements: Bonuses may also be provided for in company policies, collective agreements, or other documents. You need to follow these agreements unless circumstances make it impossible to do so.
• Custom and practice: If your business has consistently paid bonuses in the past, this may have created a “right of expectation.” In such cases, suddenly discontinuing the bonus without prior consultation may be viewed as unfair, and employees could take legal action for unfair labour practices.

How to avoid disputes: Prepare, plan and communicate

You can avoid the common disputes over bonuses by focusing on three essential actions: preparing, planning and communicating.

1. Prepare

• Review all employment contracts and company policies. Ensure these documents are up-to-date and clearly state whether bonuses are discretionary or dependent on conditions such as company performance or employee contributions.
  
• Be aware of any past practices. If bonuses have been paid regularly in the past, employees will almost certainly assume this will continue, even without it being part of their contract. They could also think that bonuses are an automatic right, and not based on performance. If you’ve paid bonuses in previous years, structure your policies carefully so that paying a bonus in good years doesn’t create enforceable rights (or even unrealistic expectations) in less profitable years. Specific legal advice on this point is crucial to avoid disputes.

2. Plan

• Use cash-flow planning to assess your ability to pay bonuses so you can make informed decisions about whether or not you can afford bonuses, and to give you early warning of any possible challenges.
  
• When you’ve made your decision, think about how and when to tell your staff about it.

3. Communicate

• Clear and early communication is key to managing employee expectations. If you won’t be paying bonuses this year, or will be reducing the amount, let your employees know well in advance to avoid last-minute disappointment.
  
• If you are able to pay bonuses, take the opportunity to reinforce the link between performance and reward. Thank everyone for their hard work and contributions to the success of the business.
  
• Remind staff about the taxman waiting in the wings for his cut. This could come as a nasty shock, particularly if the bonus pushes an employee into a higher tax bracket.
  
• Open communication and consultation build trust and help maintain morale and productivity, even if the news is disappointing. Employees will appreciate honesty and clarity, especially if you’re facing financial difficulties.

How we can help

If an employee believes they are contractually or customarily entitled to a bonus and you fail to pay it, they may cry “unfair labour practice” and take the matter to the CCMA (Commission for Conciliation, Mediation and Arbitration).

If you’re uncertain about your obligations or if you anticipate disputes, we’re here to help. We can review your employment contracts, assess past practices, and provide guidance on how to manage employee expectations legally and fairly.

“That which we call a rose, by any other name would smell as sweet.” (Shakespeare, in Romeo and Juliet)

Your wedding to-do list will be a long one, and getting all the “boring legal bits” in order before you marry may not seem like a huge priority. But it is. Choices you make now will affect both of you (and your families) forever.

One of those choices is what surname/s you want to adopt in your marriage. We’ll discuss your options below. And although they’re currently available only to women, there’s good news on that front – a recent High Court decision has set the stage for men to be given the same choices as women.

What’s the current position?

In terms of our Births and Deaths Registration Act, as a man you can only change your surname by application to the DHA (the Department of Home Affairs) but as a woman you can automatically:

1. Take your husband’s surname, or
   
2. Revert to or retain your maiden surname or any other prior surname, or
   
3. Join your surname with your husband’s as a double-barreled surname.

Those choices are of course a huge improvement on the old default position of wives automatically having to take their husband’s surnames. But there’s still inherent inequality in the law: while women have these choices as of right, a man still has to apply to the DHA for authority to change his surname. Worse still, he must give a “good and sufficient reason” for his application, and the applicable regulations say that in this context your reason “must relate to a change in the marital status of a woman”. These regulations have previously been declared invalid as “ultra vires” (made without authority) but they are very specific in excluding men from the equation.

Two couples challenge the status quo – and win

The groundbreaking High Court decision stems from the resolve of two couples to challenge that remnant of gender inequality:

1. J… and H… (their full names aren’t used in the judgment to respect their privacy) wanted to use J’s birth surname as it symbolized her connection to her parents who died when she was four. H pledged his unwavering support for her stance and wanted her surname to be their family name in which their children would be raised. The DHA agreed that J could retain her surname but said it was unable to allow H to adopt the same name.
   
2. Jess and Andreas (their names were included in the judgment) decided that, because Jess is an only child whose maiden surname is important to her, they would both combine their surnames into a hyphenated surname. They wanted their names to be the same and to reflect their familial unit. It was only when the time came to complete their marriage certificate that they realised only Jess could go the double-barrel route. The DHA again said they couldn’t do the same for Andreas.

In a joint application, the couples asked the High Court to declare that the relevant sections of the Act and regulations are unconstitutional. Our Constitution states, after all, that the right to equality includes full and equal enjoyment of all rights and freedoms, with the State being prohibited from unfairly discriminating directly or indirectly against anyone based on, among other things, gender or marital status. They argued that that “the Act has retained an archaic and patriarchal default position that only women are entitled, as of right, to assume a different surname.”

The Court with little ado issued the order of unconstitutionality, giving parliament two years to remedy this and ordering that in the interim men will have the same rights as women to change their surnames and to resume previous surnames on marriage, divorce or the death of a spouse. It also specifically ordered the DHA to amend these two couples’ surnames as requested.

Now it’s over to the Constitutional Court, then on to parliament

The order of unconstitutionality only comes into force as and when confirmed by the Constitutional Court so for now unfortunately your choices remain limited as above.

Whatever you settle on, before making your final decision you might want to ask us about the legal consequences. Then tell the marriage officer upfront what your choice is so that your marriage certificate, marriage register and National Population Register all reflect your married names correctly.

If you need assistance with this, or any other legal aspect of marriage, please contact us. (But please don’t ask us for help with the flowers!)

“Don’t wait to buy land, buy land and wait.” (Will Rogers)

Summer’s a great time to look for property. With the year winding down and the holiday season upon us, many sellers who’ve been holding back are now putting their properties back onto the market, so expect to see some great new buys out there.

But that’s not the only reason…

Blue skies ahead?

The recent interest rate cut, which hopefully heralds more cuts to come, will not only make bond repayments more affordable, but it should also help stimulate our economy generally. If these positive trends hold, the resultant uptick in economic activity, with reduced pressure on consumers and higher earnings for businesses and individuals, should increase demand for property. And that, of course, would see prices move into an upward phase.

So, if you have any thoughts at all of buying a new home or investment property, now could be the perfect time to do it. If you wait too long, prices could really jump.

It is of course essential to go into the process well-prepared. We’re talking about one of your most important long-term investments, after all. So, here’s our checklist.

Your buyer’s checklist

Every buyer and every buying situation will be different, so do bear in mind that this list is just a rough guide to some of the more important factors to consider when looking for a property and/or making an offer.

1. Location is keyWhen it comes to real estate, location is one of the most critical factors. You can change a lot about a property, but you can’t change its location. Consider the following:
   • Work and schools: Is the property close enough to your place of work and your children’s schools?
     
   • Local amenities: Are there shopping centres, medical facilities and other amenities nearby?
     
   • Safety: Research the crime statistics in the area. How secure is it?
     
   • Growth and resale potential: Historically, have prices risen in line with other areas? Are there any planned developments in the area, such as new roads, malls, or housing estates?
     
2. Budget wiselyBe clear about your budget before you start looking at properties. Don’t only consider the price of the property but also the additional costs involved:
   • Transfer costs: These include transfer duty, conveyancing fees, and other legal costs associated with the purchase.
     Bond registration costs: If you’re taking out a home loan, you’ll need to pay bond registration fees.
     Rates and levies: Investigate the monthly rates you’ll need to pay, plus levies if the property is part of an estate or complex.
     Maintenance: Be realistic about the maintenance costs you may face after purchasing the property. The 1% rule advises setting aside at least 1% of the home’s value every year for upkeep.
   Put all those costs, and other items like deposits that need to be paid, into a cash flow forecast so you aren’t caught short at any stage of the process.
   
3. Beware online fraud!When it comes to paying the deposit and then, later, the costs and balance of the purchase price, be very aware of the dangers of phishing and fake emails. Don’t pay a cent to anyone without personally phoning them to confirm their banking details!
   
4. Conduct a thorough inspectionBefore making an offer, it’s crucial to inspect the property carefully. Look for any signs of wear and tear that could lead to costly repairs down the line:
   • Structural issues: Cracks in the walls can be a warning sign of bigger problems.
     Damp and leaks: Check for signs of damp, especially in bathrooms and kitchens.
     Electrical, plumbing and gas: Ensure that the wiring, gas and plumbing systems are in good working order.
   Consider getting a professional inspection done to avoid surprises after the purchase. Pay close attention to the “mandatory disclosure form” that the seller must give you – it should list all known defects, boundary line disputes, building plan issues and the like. Also have a close look at all the compliance certificates that the seller is obliged to obtain – electrical, beetle, gas (if applicable), electric fence (if applicable) and water installation (Cape Town only).
   
5. Who’s the buyer?Consider also who is going to be the buyer? You? Your spouse or life partner? Both of you? A trust? Another entity?
   
6. Buying into a complex?If you’re buying into a complex, have you checked what rules and regulations you’ll be bound by? What levies you will pay, what special levies may be on the horizon, and whether the scheme’s finances are sound?
   
7. Beware nasty surprises…Make sure there are no nasty surprises lurking in the shadows. Like servitudes or restrictions in the title deed, or undisclosed tenants or unlawful occupants on the property.If you plan to extend or subdivide the property, or to use it for anything other than residential purposes, check both the local zoning regulations and the title deeds for restrictions.And if that beautiful sea or mountain view is important to you, what will happen if the neighbours suddenly decide to go double or triple storey? Does the zoning allow that? Is it a realistic risk? What about other risks like a busy Airbnb or home business opening up next door?Ask for a copy of the occupancy certificate and of building plans, and check with the local municipality that all structures are legal and built as per approved plans. Otherwise, your friendly local authority might suddenly be knocking on your door with a not-so-friendly demolition order – as happened in a recent case in the Pietermaritzburg area.
   
8. Understand the terms of the offerWhen you’re ready to make an offer, ensure you understand the terms of the agreement. Pay close attention to:
   • Suspensive conditions: These are conditions that must be met before the sale goes through, such as securing a home loan. Check the wording carefully, the “bond clause” in particular is often a source of confusion and dispute.
     
   • Occupational rent: If the seller remains in the property after the sale, you may be entitled to receive occupational rent until you take possession. If, on the other hand, you take possession prior to transfer, you’ll probably have to pay occupational rent to the seller.
     
   • Deposit: Know how much deposit is required and when it must be paid.
     
9. Get professional helpSince buying property is one of the biggest financial decisions you’ll make, it’s essential to have experienced professionals guiding you through the process – from finding the right property to ensuring all the paperwork is in order.

The bottom line

There is a myriad of important factors at play, and you only get one shot at getting this right. So, before you agree to or sign anything, contact us. Let us help make your property purchase stress-free and rewarding!