Frequently Asked Questions

• What is a conveyancer and do I need one? 

  A conveyancer is an attorney who has passed a specialist board exam and is admitted by the High Court to attend to the registration of property transactions at the Deeds Office. In South Africa, only a qualified and admitted conveyancer may lodge and register a transfer of immovable property — you cannot do it yourself. The conveyancer is appointed by the seller in a standard sale, though in practice the parties often agree on a conveyancer in the offer to purchase.

• What is an offer to purchase and is it legally binding? 

  An offer to purchase (OTP) is a written agreement between buyer and seller setting out the terms of the property sale — price, payment terms, occupation date, suspensive conditions and any special conditions. Once signed by both parties and any suspensive conditions (such as bond approval) are met, it becomes a legally binding contract. It is strongly advisable to have your attorney review the OTP before signing, as it is difficult to undo once binding.

• What is a suspensive condition in a property sale? 

  A suspensive condition is a clause that makes the agreement conditional on a specific event occurring — most commonly bond approval by a bank. If the condition is not met within the agreed timeframe, the agreement lapses and neither party is bound. Common suspensive conditions include bond approval, the sale of the buyer’s existing property, and the granting of municipal approval.

• What does "occupation" mean versus "transfer"? 

  Occupation is the physical handover of the property — the date the buyer gets the keys and moves in. Transfer is the legal change of ownership registered at the Deeds Office. These normally happen on the same day when the transfer is registered but it can be on different dates when occupation occurs before transfer.  If occupation occurs before transfer, the buyer typically pays occupational interest to the seller for the period between occupation and registration.

• What is occupational interest and how is it calculated? 

  Occupational interest is a rental equivalent paid by the buyer to the seller when the buyer occupies the property before transfer is registered. It is calculated as a daily or monthly amount, usually agreed upon in the OTP or its addendum, and is often based on the outstanding bond amount or agreed market rental. It compensates the seller for the buyer’s use of their asset before they receive the proceeds of sale

• What happens if there is a defect in a property I have purchased?

  South African property law distinguishes between latent defects (not visible on reasonable inspection) and patent defects (visible). A voetstoots clause in a sale agreement generally protects the seller from liability for latent defects unless the seller had knowledge of the defect and deliberately concealed it. Buyers should always conduct a thorough inspection and, where possible, appoint an independent property inspector before signing.

• What is a sectional title unit and how does ownership work?

   In a sectional title scheme, you own your individual unit (section) outright, together with an undivided share in the common property. A body corporate, made up of all unit owners, is responsible for managing and maintaining the common property. Owners pay a monthly levy to the body corporate to fund these costs. Sectional title ownership is registered at the Deeds Office in the same way as freehold ownership, and your section can be mortgaged, sold or transferred.

• What is the difference between a transfer attorney and a bond attorney? 

  The transfer attorney is appointed by the seller to attend to the transfer of ownership from seller to buyer. The bond attorney is appointed by the bank to register the buyer’s mortgage bond. These are two separate attorneys attending to two separate registrations simultaneously — they both lodge at the Deeds Office on the same day to ensure simultaneous registration. The buyer pays both sets of fees.

• What is a bond cancellation attorney? 

  When a seller has an existing bond over the property, that bond must be formally cancelled at the Deeds Office when the property is sold. The bond cancellation attorney is appointed by the seller’s bank to cancel the bond. This too happens simultaneously with the transfer and bond registration. Cancellation attorney fees are generally paid from the seller’s proceeds.

• What is bridging finance in the context of a property transaction? 

  Bridging finance is short-term funding provided to a seller who has already sold their property but has not yet received the proceeds because transfer has not yet been registered. It allows the seller to access a portion of their sale proceeds early, before registration, to fund a deposit on their next purchase or meet other financial obligations. Bridging finance providers charge interest for the period between the advance and registration.

• What is the difference between a sale of shares and a sale of a business?

   In a sale of shares, the buyer acquires ownership of the company itself — including all its assets, liabilities, contracts and obligations. In a sale of a business (or going concern), the buyer purchases specified assets and may assume certain liabilities, but does not acquire the company as a legal entity. The choice between structures has significant tax, liability and operational implications and should be carefully considered with both legal and tax advice.

• What is a Memorandum of Incorporation (MOI) and can it be customised?

  An MOI is the founding document of a company under the Companies Act 71 of 2008, replacing the former articles and memorandum of association. Every company must have one. The Companies Act provides a default standard MOI, but it can be substantially customised to reflect the specific governance and commercial arrangements of your company. A well-drafted MOI can provide significant flexibility in areas such as board composition, shareholder rights and decision-making thresholds. Since the new Companies Act 2008, the MOI takes preference over the shareholders agreement in the event of a conflict between the two.

• What is a shareholders agreement and why is it important?

  A shareholders agreement is a private contract between the shareholders of a company that governs all aspects not specifically covered by the MOI pertaining to their relationship, rights and obligations. It covers matters such as how shares may be transferred (right of first refusal, come-along and tag-along provisions), how decisions are made, what happens on the exit of a shareholder, dividend policy and dispute resolution. It supplements the MOI and is essential in any company with more than one shareholder.

• What is the Competition Commission approval process for mergers?

  Large mergers — and certain intermediate mergers — must be notified to the Competition Commission before implementation. The Commission assesses whether the merger would substantially prevent or lessen competition, and whether it raises public interest concerns such as employment impacts. The process involves filing a merger notification, responding to information requests and potentially attending hearings. Failure to notify a notifiable merger is a serious offence. We assist clients in preparing merger filings and navigating the approval process.

• What happens to my estate if I die without a will?

  If you die intestate (without a valid will), your estate is distributed according to the Intestate Succession Act. The Act prescribes a fixed formula — surviving spouses and descendants share the estate in defined proportions. This may not reflect your wishes, and can result in unintended consequences, particularly in blended families, unmarried partnerships or where there are minor children. Having a properly drafted will is the single most important step you can take to protect your estate.

• What makes a will valid in South Africa?

  A will must comply with the formalities of the Wills Act, be in writing and signed by the testator (the person making the will) at the end of the document and on each page. The signing must be witnessed by two competent witnesses who are both present at the same time, and who themselves sign the will in the presence of the testator. Beneficiaries and their spouses should not act as witnesses, as this can invalidate their bequest. An invalid will can result in intestate succession, which may have very different consequences.

• What is an antenuptial contract and can I get one after marriage? 

  An antenuptial contract (ANC) is an agreement entered into before marriage that determines the matrimonial property regime applicable to the marriage. Without an ANC, you are automatically married in community of property, which means your estate and your spouse’s estate are merged and you share joint liability for each other’s debts. An ANC must be executed before a notary public before the marriage takes place and registered at the Deeds Office within 3 months after the marriage. It cannot be entered into after marriage without a court order.

• What is a trust and what are its main benefits? 

  A trust is a legal arrangement in which a trustee holds and manages assets on behalf of one or more beneficiaries in accordance with a trust deed. Trusts are widely used in estate planning for asset protection, continuity of family wealth across generations, flexibility in distributing income and capital, and in certain circumstances for tax efficiency. They are also used in business and property structuring. The main types relevant to estate planning are inter-vivos trusts (formed during your lifetime) and testamentary trusts (formed on death in terms of a will).

• What is the difference between mediation, arbitration and litigation? 

  Litigation is the formal process of resolving a dispute through the court system. It is public, follows fixed procedural rules and results in a judgment that can be enforced. Arbitration is a private process in which the parties agree to have their dispute decided by one or more arbitrators rather than a court. It is generally faster and confidential. Mediation is a facilitated negotiation process in which a neutral mediator assists the parties to reach a settlement — the mediator does not impose a decision. Many commercial contracts include dispute resolution clauses specifying which process applies.

• What is a letter of demand and when should one be sent? 

  A letter of demand is a formal written notice to a debtor or defaulting party requiring them to perform an obligation — typically payment of money or compliance with a contractual term — within a specified period, failing which legal proceedings will be instituted. It is often a precondition to litigation and serves as a formal record that the other party was placed in mora (default). It is advisable to have your attorney draft or review a letter of demand to ensure it is legally effective and does not inadvertently prejudice your position.

• What is the difference between the Magistrate's Court and the High Court? 

  Magistrate’s Courts have a jurisdictional limit — they can only hear civil matters where the amount in dispute does not exceed R400,000 (Regional Court) or R200,000 (District Court). High Courts have unlimited civil jurisdiction and hear more complex or high-value matters, as well as appeals from Magistrate’s Courts. The choice of forum affects cost, procedure and the level of expertise brought to bear on the matter.

• What legislation governs private nature reserves in South Africa? 

  The primary legislation is NEMPAA — the National Environmental Management: Protected Areas Act 57 of 2003 — which provides the framework for the declaration, management and governance of protected areas, including private nature reserves. It is supplemented by provincial nature conservation ordinances and regulations, as well as SPLUMA (the Spatial Planning and Land Use Management Act) for zoning and land use matters, and the Deeds Registries Act for the registration of conservation servitudes and real rights.

• Can a private landowner declare their land a nature reserve? 

  Yes. Private land can be declared a private nature reserve under NEMPAA with the consent of the landowner. The declaration imposes certain management obligations and restricts land use, but also confers legal protected status on the area. The process involves an application to the relevant provincial authority, public participation, and ultimately a formal declaration. Conservation servitudes can also be registered over land at the Deeds Office to create binding long-term restrictions on use without full protected area status.