Introduction

When a party to an Immovable Property Sale Agreement dies, there are crucial legal questions that arise. For instance, does the agreement become invalid? Does the agreement continue to exist? What are some of the implications to consider? In conveyancing, the process of transferring immovable property may become adversely affected and certain implications may arise, which can affect both parties to the agreement – the seller and the buyer. Thus, this article provides a concise overview of the legal implications to observe, should a party to such a Sale Agreement die.

When a party to a Sale Agreement dies, the agreement remains valid and does not automatically terminate, due to the essentialia of the Sale Agreement, which set out the transfer rights and obligations for both parties.

The Seller as the Deceased

Should the seller, as a party to the Sale Agreement, die prior to the successful transfer of the property, the seller’s estate must be reported to the Master of the High Court and an executor appointed. Once appointed, the executor must determine if the deceased’s estate is solvent, and whether the acceptance of the Sale Agreement is to the benefit of the deceased’s estate. The executor will have the election of either proceeding with the Sale Agreement or opting to cancel. Should the executor choose to proceed with the Sale Agreement, it is essential that the executor obtains a consent certificate from the Master of the High Court, which speaks to the endorsement of the sale from the deceased’s estate into the name of the purchaser. Further, should the deceased have signed any transfer documents prior to his/her date of death, the transfer documents will lapse, and the executor may sign a new Power of Attorney. Thereafter, the Master of the High Court must endorse the transfer document, in order for the registration of the transfer to be acceptable by the Registrar of the Deeds Office.

 The Purchaser as the Deceased

Conversely, should the purchaser die prior to the transfer of the property from the seller to the purchaser’s name, the deceased estate must too be reported to the Master of the High Court. In the event that the purchaser proceeded to buy the property with a bond, the possibility remains that the bank may withdraw the bond approval on the grounds that there no longer exists an income to finance the bond payment after the registration of the bond. Therefore, the Sale Agreement will lapse should the bank not grant the bond at the time of death of the purchaser. Inversely, should the deceased proceed to enter into a cash transaction, the appointed executor will be bound by the terms and obligations of the Sale Agreement, however, may also proceed to request a mutual cancellation due to the untimely death of the purchaser.

Whatever the situation presents, it is essential that the instructed conveyancer provides the parties with the best course of action in proceeding thereafter, which may consist of seeking legal advice. Such advise may be from a general litigation, contracts or administration of deceased estates legal advisor or attorney, and as the surviving party to the Sale Agreement, it is important to weigh the different legal options present, prior to making an informed decision.

Conclusion

The death of a party to a Sale Agreement, undoubtedly complicates the conveyancing process, but does not automatically nullify the contract. By navigating the legal processes and involving the necessary estate representatives, both buyers and sellers can continue with the property transfer, alternatively, mutually decide to terminate the agreement. Given the sensitivity of such situations, it is advisable for all parties to seek the necessary legal advice to ensure a smooth transition and as minimal delays as possible.

Written by Zamathombeni Magagula

We trust that you found this article informative, please email info@hjwattorneys.co.za for assistance with all your legal queries.

 This article is provided for informational purposes only and should not be substituted for legal advice on any specific matter. Any opinions expressed herein are subject to the law as at the time of writing and will change in accordance with any change in the law. We recommend that you contact HJW Attorneys & Conveyancers at info@hjwattorneys.co.za directly for advice applicable to your specific matter.