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Patent and latent defects

The Consumer Protection Act (CPA) was introduced to protect consumers engaged in commercial transactions with businesses to avoid the consumer being treated unfairly. Unless you are purchasing a home from a developer or speculator whose ordinary course of business is to sell properties, the CPA does not come into play, and you don’t fall under its protection. An ordinary property sale is seen as a transaction between two consumers, the seller and the buyer.

The CPA will not have an effect on the voetstoots clause used in agreements of sale in an ordinary property transaction. This is why is so important to have a property thoroughly inspected before submitting an offer. There are instances where you are protected if severe defects are found after the transfer has taken place. However, it is difficult to determine whether the seller deliberately concealed the defect or genuinely wasn’t aware of it.

There are two kinds of defects. A patent defect is clearly visible on inspection of the property, such as broken window or cracks in the wall. All patent defects should be listed in the offer to purchase, along with who is responsible for fixing them. Because they are visible or obvious without professional inspection, as the buyer, you have no recourse against these types of defects. It is up to you to spot patent defects and then decide whether you would still like to proceed with purchasing the property.

The other type of defect is a latent defect, which is not easily picked up by a superficial inspection. Examples of latent defects include a leaking roof or faulty geyser. Common law states that the seller is responsible for all latent defects in the property for three years from the date of discovery of the defect. Most sellers are aware that they are responsible for latent defects which is why they include the voetstoots clause in the sale agreement. The clause protects the seller against all defects – including latent defects that are unknown to him. However, if the seller was aware of a latent defect and deliberately concealed it from you, you do have recourse against the seller. Only one problem - the onus will be on you to prove that the seller was aware of the defect but deliberately hid it.

It will be dependent on the circumstances, but if a latent defect is found, you will be able to cancel the contract or claim a portion of the purchase price. The law prescribes that you will not be allowed to simply obtain a quote for repair and then deduct it from the purchase price. You can also not refuse to pay occupational rent or a portion therefore unless the defect seriously impairs the use and occupation of the property. 

Any defects that are discovered after the sale of the property but before the property is transferred into your name will be for the seller’s account unless of course the defects are caused by you during the occupation of the property.

To ensure that you are fully protected against any latent defects, enlist the services of a professional home inspection company to check the home thoroughly. The price of paying a professional to do the job properly will be far less than the time and hassle caused by dealing with hidden defects.

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