The term "voetstoots", derived from Dutch and meaning "as is", is a common legal term in South African property law. In property sale transactions, the principle implies that the property is sold in its current condition, with all its defects, whether patent (meaning visible) or latent (meaning hidden). If included as a condition in the sale agreement, it protects the seller from later claims by the buyer for undiscovered defects, provided that the seller was unaware of the defects. A seller that deliberately conceals a defect will not be able to rely on the voetstoots provision. Traditionally, the term has been associated with the physical state of the property, but our courts have since extended the application of voetstoots beyond merely the physical aspects of the property. Understanding the broader application of voetstoots is crucial for property practitioners, buyers, and sellers alike.
In the 1977 case of Holmdene Brickworks (Pty) Ltd v Roberts Construction Co Ltd, the court clarified the notion of defects under voetstoots. It stated that-
"Broadly speaking in this context, a defect may be described as an abnormal quality or attribute which destroys or substantially impairs the utility or effectiveness of a res vendita (which means "the things sold"), for the purposes for which it has been sold or for which it is commonly used. Such a defect is latent when it is one which is not visible or discoverable upon an inspection of the res vendita."
This suggests that defects are not limited to the physical condition of the property.
A notable example is the case of Odendaal vs Ferraris 2008. In this case, the seller failed to obtain statutory approvals for building alterations and sold the property without disclosing this fact to the buyer. After signing the sale agreement, the buyer discovered the lack of statutory approval and instructed the bank and bond attorneys to halt registration until the statutory approvals were in place. The seller, claiming the property was sold voetstoots, alleged that the buyer's instruction to obstruct the registration was a repudiation of the agreement and then proceeded to cancel the agreement, seeking to evict the buyer from the property.
The court ruled that, in relation to the sale of land, voetstoots is wide enough to cover not only hidden defects in the property itself, but also defects in the title or area of the property. The court held that the lack of statutory building approvals are defects that interfere with the ordinary use of the property, thus satisfying the test outlined in the Holmdene Brickworks case. However, the court found in favour of the seller because the purchaser failed to prove deliberate concealment of the defect by the seller. Consequently, voetstoots applied and the seller was able to rely on the protection afforded by the provision because the buyer was unable to prove deliberate concealment of the defect by the seller.
In Glaston House (Pty) Ltd vs v Inag (Pty) Ltd 1977 the seller sold a dilapidated building containing a sculpture which had been proclaimed a national monument under the National Monuments Act of 1969. Although the seller knew that the proclamation prohibited redevelopment of the property, it failed to disclose this fact to the buyer. The court took a broad view and found that the sculpture's status as a national monument, preventing redevelopment, was a latent defect. The seller could not rely on voetstoots and the buyer, who incurred costs for necessary permissions and repositioning of the sculpture, successfully claimed these costs from the seller. Although the sculpture was a physical feature of the property, its proclamation as a national monument which was found to be a latent defect.
In the unreported case of Ismail NO and Another v Erf 87 Dullstroom CC 2015, the buyer claimed reduction in the purchase price due to an undisclosed unregistered road reserve which prevented the buyer from utilising 397 square metres of the 1322 square metres area of the property. The seller raised voetstoots as his defence. The court found that the unregistered road reserve is a latent defect that constituted an "abnormal quality" which impaired the utility of the property. However, the seller could not rely on the voetstoots clause as it was proved that the seller had prior knowledge of the defect and intentionally concealed it from the purchaser.
These cases illustrate that the principle of voetstoots in South African law extends beyond merely physical defects to include non-physical aspects of the property. This underscores the importance of thorough due diligence and transparency in property transactions. While it is challenging to prove inapplicability of voetstoots against a seller, sellers who deliberately conceal known latent defects can be held accountable. It is therefore prudent for property practitioners, buyers, sellers, and others involved in real estate transactions to fully understand the broader implications of voetstoots to avoid unnecessary disputes.
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