COVID-19 property questions

A newsflash from Miltons Matsemela Inc which addresses the most relevant questions they have recieved from the property industry, arising from the COVID-19 lockdown.

Practical arrangements

  1.  All deeds offices country wide will also be in lockdown. This means no registrations from Friday 27 March 2020 until (the earliest) Friday 17 April 2020. We await a circular from the deeds office in Cape Town regarding the possibility of extended hours and what they are planning to do.

  2. All law firms will be in lockdown, ours included. We are however, doing what we can to set up remote work stations as far as practically possible.

  3. All of our attorneys will be available on their cell phones. Please visit our website for contact details.

  4. All estate agents need to consider the effect of this lockdown on the time lines in their Deeds of Sale.
  • Below is proposed wording for an addendum, which we have prepared and which you may want to put into place. (CLICK HERE to view the word format)

  • It is a general template obviously which can be amended to suit the specific needs of your particular sale.

  • Pay PARTICULAR ATTENTION if you have a “subject to sale”. If the first transfer registers on Thursday 26 March 2020 for instance, the second one will only be able to register 17 April 2020 at the earliest. This means that there will be a 3 week gap between them instead of only one day as is customary in such instances. The seller of the property which registers first (being the purchaser of the second property) may not be able to vacate, as the property he has bought, will only be registered on his name, on 17 April 2020, or later. WE RELY ON ALL AGENTS TO PLEASE CONTACT THEIR SELLERS AND BUYERS TO MAKE ARRANGEMENTS AROUND THIS AND TO ADVISE US ACCORDINGLY!

  • With regard to any of our registrations that may take place on Thursday 26 March 2020, we will do all we can to ensure that proceeds and commission are still released on Friday 27 March 2020. We see this as an essential banking service and will thus attend to work on Friday to deal with this.
  1. All arrangements that were made with compliance companies to attend to repair work, removal companies to move furniture etc, in this time, will have to be postponed.

Proposed wording for addendum

Pertaining to the sale agreement concluded between ……………….. (Seller) and ……………. (Purchaser) pertaining to ……………………………. (property description) concluded on……………………, the parties hereby agree as follows:

  1. To extend the deadline/s for all suspensive conditions contained therein by 31 days as from date of signature hereto / to ……………………. (date);

  2. To extend the deadline/s for payments of any deposits which are intended to be invested in a separate interest bearing account for the benefit of the purchaser, and which would otherwise have been payable within the period of 26 March 2020 to 16 April 2020, to 17 April 2020 / ………………….. (date);

  3. To extend the deadline/s for the provision of any guarantees or undertakings, that may have been due within the above lockdown period, to secure any financial arrangements, by 7 days / to ……………… (date);

  4. That the estimated transfer date (if any was specifically agreed upon) be extended by 31 days as from date of signature hereto/ to ………..(date);

  5. That in the event that the purchaser was intending to occupy / possess the property during the above mentioned lockdown period, that this be extended by 31 days from date of signature hereof / to …………… (date).

What about occupation dates; tenants whose leases expire; tenants who have paid deposits to take occupation on 1 April 2020; landlords who have obtained eviction orders etc?

This is a National lockdown which means that:

  1. Everyone must, quite literally, stay put as from midnight Thursday 26 March 2020 until midnight Thursday 16 April 2020;

  2. No landlord may demand from his/her tenant to vacate, during this time even if the lease has expired or been terminated;

  3. Where a tenant has paid a deposit but now cannot move in, the landlord must hang on to it and honour the lease when he can;

  4. If a landlord obtained an eviction order, it cannot be executed in this time;

  5. Rental deposits will have to be retained; outgoing inspections will have to be postponed;

  6. Where buyers and sellers have agreed to exchange occupation pending transfer, this will also have to be suspended/postponed;

  7. No one will be able to claim damages of any kind should they suffer any damages as a result of any of this;

  8. Removal companies will probably be allowed to retain deposits and payments that were made but will have to then honour the agreement later on.

The above views are our own and based on how we interpret the law surrounding vis major, i.e. a superior force.

We will keep you posted on any other developments as and when they come to hand.

Miltons Matsemela Inc
March 2020

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