Brief Summary

Contract — Sale of property — Misrepresentation and non-disclosure of defects — Appellant sold residential property to Respondents under a voetstoots clause — Respondents discovered significant defects post-occupation, including an invalid electrical compliance certificate and various structural issues — Respondents claimed damages for breach of warranty and misrepresentation — Court a quo found in favor of Respondents, concluding they had established the Appellant's duty to disclose defects and that the Appellant had failed to do so — Appeal dismissed, confirming the validity of the original judgment and the Respondents' claims for damages.

Comprehensive Summary

Summary of Judgment

1. Introduction

This was an appeal to the Gauteng Local Division, Johannesburg, against a judgment of the Randburg Magistrate’s Court. The appeal was heard by Cele AJ, with Twala J concurring.

The appellant was Ms Emmerentia Van Rooyen (the defendant in the court a quo), the seller of a residential property. The respondents were Mr Damon Jay Brown and Ms Jenna Cathleen Brown (the plaintiffs in the court a quo), the purchasers of that property.

In the court a quo, the magistrate granted judgment in favour of the respondents on 11 September 2015, awarding R92 352.80 as damages for defects discovered after occupation, together with costs. In the High Court, the appellant sought to set aside the whole of that judgment.

There was also an interlocutory procedural issue: the appellant applied for condonation for the late filing of the appeal record due to difficulties obtaining the transcript. That application was unopposed and was granted.

The subject-matter of the dispute concerned the consequences of a voetstoots sale of a residential property, the purchaser’s remedies for alleged latent defects and non-disclosure, and contractual claims based on an express warranty (fixtures and fittings) and an obligation to provide a valid electrical compliance certificate.

2. Material Facts

During late 2010 or early 2011 the appellant placed her house on the market through an estate agent, Kings Estate Agents and Auctioneers. After an initial rejected offer and an unsuccessful auction, the property was ultimately sold to the respondents in July 2011 when the price was reduced and the respondents made an acceptable offer.

The respondents inspected the property before signing the final agreement. The evidence was unclear on the exact number of inspections, but the court accepted that the inspections occurred in the presence of the agent, and that on one occasion the second respondent brought her father, who was a builder, to assist with the inspection. The respondents took occupation in December 2011 (paying occupational rent), and transfer was registered in January 2012.

The written sale agreement contained a voetstoots clause, provided for an electrical compliance certificate, included a non-variation clause, and contained an express warranty (clause 10) in respect of specified fixtures and fittings, including (as dealt with in evidence) items such as the pool filter and automatic pool cleaner, and security-related fixtures.

After occupation, the respondents identified various defects and asserted that these had not been apparent during viewing and had not been disclosed by the appellant and/or the agent. They pleaded claims founded on non-disclosure (allegedly deliberate or negligent, and pleaded in a manner alleging dolo malo) and on breach of the express contractual warranties and certificate obligations. The defects pleaded included, among others, roof leaks, a leaking thatch carport roof, incorrectly fitted kitchen windows, cracked mirrored cupboard doors, a defective electric fence, defective pool pump and filter, missing front door keys, an invalid electrical compliance certificate, and signs of damp/leaks in walls.

On appeal, the court treated as effectively common cause that the property did have defects and that they were not shown or disclosed to the respondents, while the appellant’s primary contention was that the defects were patent rather than latent and that she was protected by the voetstoots clause. The latent/patent characterisation, and the appellant’s knowledge and non-disclosure, were disputed issues central to the appeal.

In relation to specific items, the court relied on the following facts in its assessment. The leaking and damp problems could only be detected on a rainy day, and there was no evidence that the respondents inspected on such a day. The “hidden bathroom” (accessed via a cupboard door) allegedly showed signs of heavy leakage, including a sagging ceiling and holes made to release trapped water; the respondents’ evidence was that it had not been shown to them at viewings. The appellant acknowledged knowledge of some problems (including occasional leakage at kitchen windows during heavy rain and recurring thatch roof leakage) but stated she did not communicate these to the agent or the respondents.

Concerning the electric fence, the appellant showed the respondents the energiser and warned them not to touch the board because it had shocked her gardener on prior occasions. Expert evidence for the respondents was that the energiser was beyond economical repair and that other deficiencies affected the fence’s functionality. The appellant maintained she believed the fence worked because of ticking sounds, but the court relied on her knowledge of the shocking incidents as material undisclosed information.

Regarding the pool equipment, the respondents’ evidence was that the pool pump and filter did not function properly after occupation and stopped working. An expert inspection shortly thereafter concluded the filter and pump required replacement and attributed the condition to wear and tear over years of use. The appellant’s evidence was that the equipment was in working condition at the time of sale.

As to keys, the appellant admitted that she knew there were no keys for the front door and that she did not disclose this, explaining it as an omission.

The Electrical Compliance Certificate furnished by the appellant was found, on the evidence accepted by the courts, to be invalid, and the respondents incurred costs to rectify electrical defects through another electrician after the appellant’s electrician did not remedy the defects within a reasonable time.

The magistrate found the respondents had discharged the onus and accepted their version as more probable and credible, concluding the defects were latent and awarding damages and costs. The appellant challenged those conclusions on appeal.

3. Legal Issues

The central legal questions were whether the appellant could rely on the voetstoots clause to avoid liability for defects, and, if not, whether the respondents established a basis to recover damages for defects that were said to be latent and not disclosed.

A core issue concerned the application of legal principles to facts, namely whether the defects were patent or latent, and whether the appellant knew of defects (or material information about them) and deliberately concealed them or failed to disclose them in a manner defeating reliance on voetstoots.

The court also had to determine contractual issues arising from the sale agreement, including whether the appellant breached an express warranty regarding fixtures and fittings (notably the pool equipment), and whether she breached the obligation to provide a valid Electrical Compliance Certificate, including whether that obligation was confined to the pre-transfer period or persisted in circumstances where the certificate proved invalid and remedial work was required.

These issues involved fact-finding and credibility evaluation (particularly where the magistrate had accepted the respondents’ version), and the legal consequences flowing from those findings in the context of a voetstoots sale and express contractual obligations.

4. Court’s Reasoning

The court approached the appeal by identifying the legal effect of a voetstoots clause and the circumstances in which a seller cannot rely on such a clause. It accepted the general proposition that voetstoots entails a sale “as is”, under which a seller is generally not responsible for defects in the merx. However, relying on the principles discussed in the authorities it cited, the court emphasised that reliance on voetstoots is not available where the seller was aware of latent defects and fraudulently concealed them, or where the seller provided an express, implied or tacit warranty covering the defects in question.

Applying those principles, the court rejected the appellant’s submission that the defects (save possibly the fence) were patent and discoverable on inspection. It reasoned that there was no corroboration for the appellant’s assertion that the defects were readily visible. It accepted that certain defects—particularly those involving leaking roofs, walls, and thatch—were not discoverable except under conditions such as rainfall, and there was no evidence that the respondents inspected under such conditions. On this footing, the court regarded those defects as latent in nature.

The court placed weight on the fact that the respondents’ evidence on important aspects remained effectively uncontroverted, particularly because the estate agent who showed the respondents the property was not called to testify. The court treated the “hidden bathroom” evidence as unassailable on the record before it, reinforcing the conclusion that material defects were not disclosed and would not have been obvious during ordinary viewings.

In relation to specific disputed items, the court engaged in an evaluative assessment aligned with the magistrate’s credibility findings. Regarding the front door keys, the appellant’s admission that she knew keys were missing, coupled with the absence of a satisfactory explanation for non-disclosure, supported the conclusion that the respondents were not informed of a material defect or shortcoming at the time relevant to their purchasing decision. As to the cracked mirror panes, the court relied on the magistrate’s advantage in observing witnesses and the demonstration presented at trial, and treated the appellant’s version as a bare denial not sufficient to displace the finding.

On the electric fence, the court rejected the argument that the appellant’s lack of technical expertise excused non-disclosure. It reasoned that the appellant possessed specific, significant information that the fence had shocked a person on multiple occasions, and that she failed to convey this information during the decision-making period before the sale. The court held that no innocent explanation was advanced for that omission and drew the inference that the appellant deliberately concealed that information, which undermined reliance on the voetstoots clause.

With respect to the pool pump and filter, the court treated the matter as falling within the scope of the express warranty in clause 10. The evidence accepted was that shortly after occupation the equipment was not functioning and required replacement, with expert evidence indicating long-term wear and tear. The court concluded that the warranty provided by the appellant did not, on the accepted facts, achieve the purpose for which it was intended, and therefore the appellant’s ground of appeal on this issue lacked merit.

Concerning the Electrical Compliance Certificate, the court accepted the evidence that the certificate provided was invalid and that the respondents suffered damages because defects were not remedied by the appellant’s electrician within a reasonable time, prompting the respondents to engage their own electrician to rectify defects and obtain a valid certificate. The court characterised the failure to provide a valid certificate as a clear breach of the relevant contractual term. It rejected the appellant’s contention that the obligation was limited to the period before transfer, reasoning (on the facts accepted) that the breach and its consequences were not confined to pre-transfer timing where the certificate proved invalid and remedial steps were required.

Finally, the court referred to the appellant’s evidence that she decided not to fix faults because she had accepted a low offer, treating this as indicative of her approach and as reinforcing the conclusion that known faults were not disclosed.

5. Outcome and Relief

The High Court granted condonation for the late filing of the appeal record, as the application was unopposed and the delay was explained by difficulties obtaining the transcript.

On the merits, the appeal was dismissed. The court upheld the magistrate’s award of damages in favour of the respondents.

The appellant was ordered to pay the costs of the appeal.

Cases Cited

Legadima Garden Services CC v Lightstorm Electrical CC [2017] JOL 38393 (GP)

Odendaal v Ferraris 2009 (4) SA 313 (SCA)

Beyers NO and Another v Ackerman [2007] 3 All SA 125 (C)

Legislation Cited

No legislation was expressly cited in the judgment text provided.

Rules of Court Cited

Uniform Rules of Court, Rule 50(7)(a)

Held

The court held that the appellant could not successfully rely on the voetstoots clause on the facts accepted by the magistrate and sustained on appeal, including that key defects were not shown or disclosed and were not established to be patent and readily discoverable on inspection.

The court further held that the appellant’s non-disclosure in relation to certain defects and conditions (including knowledge relating to the electric fence and other defects) justified the rejection of the appellant’s defence, and that the respondents’ claims based on warranty (pool pump and filter) and breach of the obligation to provide a valid Electrical Compliance Certificate were properly upheld.

Accordingly, the court dismissed the appeal with costs.

LEGAL PRINCIPLES

A voetstoots clause generally denotes a sale “as is”, limiting a seller’s liability for defects in the merx, but it does not protect a seller in circumstances where the seller was aware of a latent defect and fraudulently concealed it or refrained from disclosing it to the purchaser.

A seller remains obliged to deliver the merx without defects, and delivery is not in accordance with the contract where a latent defect is fraudulently concealed or where the seller has furnished an express warranty that the property or specified items are free from the relevant defect.

Where an agreement imposes a contractual obligation to provide a valid electrical compliance certificate, failure to provide a valid certificate constitutes a breach of contract on the facts accepted, and liability may follow where the purchaser incurs costs to remedy defects and secure compliance after the seller’s certificate proves invalid and remedial steps are not taken within a reasonable time.

Van Rooyen v Brown and Another (A3104/2015) [2018] ZAGPJHC 453 (28 June 2018)