What happens if a seller can’t get a certificate from the municipality?
What happens if after signing an offer to purchase a seller cannot get a clearance certificate from the municipality? Amongst other issues the seller I signed with has a R90 000 problem on account , which he was well aware of before signatures. His transfer lawyer says she will give him a loan upfront to get the property transferred. This has still not happened after much back and forth.
Clearance certificates have a long history . The municipality insists on outstanding debts from water, electricity and rates being paid first before transfer can be done. Even if the debt comes from previous owners or delinquent tenants. Fortunately a recent ruling by the constitutional court has held that property owners or purchasers cannot be held liable for the debts of previous owners or tenants. So that might be some relief if the seller’s debt were not incurred by himself. You have a right to cancel and demand damages if the seller is not able to deliver by a certain date. The terms of a standard offer to purchase will stipulate time periods. Otherwise it will be in order to put him or notice , with cancellation and damages. That should include fixing all outstanding issues related to the deal.