Estate agents now owe sellers and buyers an equal duty of care

Estate agents, soon to be known as “property practitioners” in terms of the new Property Practitioners Act (PPA), are usually paid their commission by the seller of the property. Now the new PPA will compel agents to be fully transparent and ensure that prospective buyers have all the information available in order to make informed buying decisions.

Section 69 (2) of the PPA states: “A property practitioner owes a buyer and a seller a duty of care”.  

Duty of care is a legal term

A “duty of care” is a legal term in South Africa relating to the “law of delict”. The law of delict refers to the liability of one person for harm caused to someone else.  The purpose of delict law is to provide compensation to those who have suffered losses or injuries because of the wrongful conduct of others.

Chapter 10 of the PPA describes exactly the duty of care which the property practitioner owes to every buyer – despite the fact that the agent’s commission is being paid by the sellers.

This is how the PPA law compels the agent to show care to every prospective buyer.

• In terms of this new law, owners will be compelled to make a written disclosure to every potential buyer regarding all of the significant defects to the property of which the owner is aware.  
• The agent may not accept a mandate from the seller without first obtaining from the seller this written disclosure of the property’s condition.
• The agent must supply every potential buyer with a copy of the owner’s signed disclosure.
• The agent must attach the disclosure, signed by all parties, as an integral part of any agreement of sale.
• The agent must inform potential buyers that, in addition to the owner’s disclosure, a professional inspection may be required to determine significant defects or areas of non-compliance of which the owner may have been unaware.

Once the PPA comes into force, property practitioners who fail to follow the law and show the now legally required “duty of care” to buyers, will be liable for sanction by the new Property Practitioners Regulatory Authority and will also open themselves to potential claims for damages by aggrieved buyers who feel that they were not treated fairly by the agent and were not provided with the information required by law.

HouseCheck empowers by building bridges of trust

HouseCheck is keenly aware that the vast majority of agents are honest people who would like to make a full disclosure to potential buyers – both in the interests of fairness and transparency and also to avoid the possibility of unpleasant future comebacks which may result in expensive legal proceedings.

In order to assist property sellers and their agents to comply with the new PPA law and to build bridges of trust and transparency with prospective buyers, HouseCheck has developed a “Vital inspection report” whereby a seller, or their agent, can get a professional inspection report at a lower cost to HouseCheck’s usual Comprehensive report.  This HouseCheck Vital report can be used by both the seller and their agent to comply with the law and make a fully transparent disclosure on the condition of the property to potential buyers.D